[Focus Review] The Shanghai Composite Index weakly tests the bottom near the half-year line, with funds countercyclically favoring traditional energy. The computing power leasing concept remains active.

Why can the concept of AI computing power leasing stand independently from market sentiment?

According to Caixin on March 19, today 28 stocks hit the daily limit, 10 stocks were halted from trading, with a board-holding rate of 74%. Deep Huafa A and China Power LiaoNeng hit four consecutive limits, China Power Energy hit five limits in eight days, and CNOOC Capital and Oriental New Energy hit two limits in four days. The market experienced a full-day fluctuation and adjustment, with all three major indices falling more than 1%. The Shanghai Composite briefly fell below the 4,000-point mark during trading. The combined trading volume of the Shanghai and Shenzhen markets was 2.11 trillion yuan, an increase of 64.9 billion yuan compared to the previous trading day.

In terms of sectors, hot topics rotated weakly, and market sentiment hit rock bottom, with nearly 5,000 stocks declining. The oil and gas, coal, and green energy sectors performed countercyclically and remained active; meanwhile, non-ferrous metals, chemicals, rare earth permanent magnets, and steel sectors led the decline. By the close, the Shanghai Composite fell 1.39%, the Shenzhen Component Index dropped 2.02%, and the ChiNext Index declined 1.11%.

Market Sentiment and Limit-up Stocks Analysis

The rate of consecutive limit-up upgrades remains below 30%, indicating short-term sentiment remains under pressure. Although two stocks achieved three consecutive limits yesterday, all stocks attempting to upgrade from two to three limits failed, with Yabo Co., Ltd. briefly hitting the limit-down during trading. The Middle East situation has escalated again, but within the chemical industry chain, there is extreme differentiation. The chemical sector, aside from Xinghua Shares which hit the daily limit with a straight-up move, saw the highest-tier Sanfangxiang, which had five consecutive limits, retreat after a surge and even hit the limit-down in the afternoon. Rongsheng Petrochemical and Hengyi Petrochemical continued to accelerate downward after breaking short-term support. Several natural gas concept stocks like Tianhao Energy hit the limit-up against the trend, while China National Offshore Oil Corporation (CNOOC) and China National Petroleum Corporation (CNPC) both surged over 5%, though still far from their previous highs.

As the Federal Reserve’s rate cut prospects dim, international gold prices plunged over 3%, dragging down non-ferrous metals led by precious metals. Stocks like Luoyang Molybdenum and Zijin Mining fell more than 7%. Previously active aluminum electrolysis concepts also began to decline, with Hongqiao Holding hitting the limit-down. As short-term funds continue to shrink, the spreading of correction at high levels is unfavorable for stabilizing the indices.

Main Sector Hotspots

The 2026 government work report for the first time included “green fuels” and “electricity and computing synergy” as key industry cultivation directions, leaving room for renewable energy development this year. Coupled with ongoing tensions in the Middle East, the value of green energy has become more prominent. The green electricity concept re-emerged strongly, with China Power LiaoNeng, Guangdong Power A, and Shao Energy Shares hitting the limit-up and upgrading their consecutive limits. China Power Energy hit a new high with a continued surge. Popular stocks in the computing and electricity synergy concept, such as Jinkai New Energy and Yunnan Energy Holding, also surged significantly. Unlike the chemical sector, which largely depends on external news stimuli, the green energy industry chain relies relatively less on external factors. Several stocks with consecutive limits are mainly driven by the computing and electricity synergy theme, often led by high-priced stocks rather than low-priced stocks catching up to push higher.

It remains to be seen whether green energy stocks can outperform expectations once oil and gas volatility stabilizes.

Alibaba Cloud announced up to a 34% increase in prices for AI computing power and storage products. Baidu Cloud also announced price adjustments for similar products on the same day. Amid a broad industry trend of price hikes, the computing power leasing industry chain continues to be favored. Aoruite, Meili Cloud hit two consecutive limits, while trend-leading stocks such as Tongniu Information, Hongjing Technology, Jiechuan Intelligence, and Litong Electronics accelerated upward, reaching new highs. Low-priced stocks like Hengrui Shares, State Grid Information & Communication, and Mengwang Technology also began to catch up.

Furthermore, the enthusiasm for the computing leasing industry chain has begun to spread to data elements and some AI application sectors. DeepSanDa A once hit the daily limit, while Yihualu and Kunlun Wanyou surged over 10% during trading. Unlike previous periods where the tech sector’s performance diverged from oil and gas prices, recent performance of the computing leasing chain has been much stronger than hardware and less affected by overall market sentiment. Whether it can continue to resonate with the index and strengthen remains to be seen.

The conflict between Israel and Palestine has ignited, causing a surge in Middle Eastern oil facilities, leading to soaring domestic and international oil and gas prices. Brent crude oil futures broke through $110 per barrel, and European natural gas futures surged 35% at one point. The oil and gas industry chain reignited, with gas stocks like Tianhao Energy, Guo Xin Energy, Blue Flame Holdings, and Hongtong Gas hitting the limit-up. The “Two Oil Giants,” CNOOC and CNPC, both surged over 5% during trading. Since the oil and gas sector peaked on March 5 and then experienced nearly two weeks of correction, many stocks have nearly returned to their starting points, making a strong recovery today understandable.

However, compared to the green energy sector, which led the rally recently, the oil and gas sector lacks dominant stocks with multiple limits or stage-highs, which remains the biggest uncertainty for sustained performance.

On March 18, Micron released its quarterly report, expecting third-quarter revenue of about $33.5 billion and EPS of approximately $19.15, both significantly exceeding analyst expectations. However, plans to increase 2027 fiscal year spending by $10 billion caused its stock to fall about 6% after hours. Previously, the storage chip concept experienced divergence, with Hengshuo Shares falling over 10%, and stocks like Langke Technology, Demingli, and Baiwei Storage dropping more than 5%. Still, companies like Xice Testing, Tongyou Technology, and Puran Shares surged against the trend.

With Samsung Electronics’ union planning a large-scale strike, supply tensions may intensify. Spot market prices for some products have already increased nearly 20% compared to last month. Additionally, domestic cloud providers like Alibaba Cloud and Baidu Cloud announced price hikes, indicating that high storage product prices are still easily passed on through cloud service providers’ price increases. Strong downstream demand will likely support storage prices for the long term.

Market Outlook

Today, all major indices showed a weak bottoming pattern throughout the day, with the Shanghai Composite briefly losing the 4,000-point mark. Although only five non-ST stocks hit the limit-down, over 4,950 stocks declined, second only to the record of 5,071 on November 21, 2025. The median decline among stocks was as high as 2.69%, setting a monthly record.

The indices have broken below the daily Bollinger lower band, but a technical rebound around the half-year moving average is possible if bulls rely on this support. However, with all major indices completing a downward reversal of yesterday’s long lower shadow and the Shanghai Composite effectively breaking below the 60-day moving average, and with technical indicators like KDJ and MACD in death crosses, the short-term technical rebound is unlikely to reverse the current weak bottoming trend.

Today’s Limit-up Chart

(Caixin, Jin Haoming)