Hou Baolong looked at Su Yi with admiration, then quickly issued the trading instructions to continue buying to the various trading desks in the room.
As the new instructions were transmitted, accompanied by the clacking sound of the traders' keyboards, massive streams of capital ranging in the tens of millions, hundreds of millions, and even upwards of a billion yuan rapidly flowed from the operating accounts into the market.
The next moment, as these capital streams poured synchronously and consistently into the real estate, non-ferrous metals, coal, and steel sectors,
corresponding core stocks across these major sectors—such as China Vanke, Poly Real Estate, Gemdale Group, China Shenhua Energy, and Jincheng Anthracite Mining Group—suddenly saw massive buy orders exceeding tens of thousands of shares emerge on the order books.
Concurrently, their stock prices rapidly halted their decline and rebounded swiftly.
Of course, at that exact same moment,
over in the Hong Kong market, mainland property stocks experienced another collective surge.
"Looking at this market trend pattern, that institution 'Huayi Capital' is still buying heavily."
Noticing the order book anomalies in the market after 2:00 PM inside the trading room of Shanghai's Cenozoic Private Equity Fund, team leader Huang Qingyun said with a hint of surprise,
"Selling pressure in the market is very heavy, divergence is quite significant, and incremental capital is clearly insufficient. Logically speaking... even if the core logic is sound, it should probably undergo a period of consolidation, allowing the chip structure at the bottom to further consolidate and making the logic and future expectations more explicit before carving out a sustained, smooth upward trajectory. For an institution like 'Huayi Capital' to force-prop the market and launch aggressive attacks right at this moment—isn't that perhaps a bit inappropriate?"
"Where do you see them force-propping the market or launching aggressive attacks?" Fund Manager Men Xingtao smiled and said, "That institution's trading technique can be described as extremely mature. Propping up the order books at this moment is merely an attempt to absorb the panic-driven sell orders from the market; they probably have no intention of forcefully propping up the market or manufacturing a rally. However..."
Men Xingtao paused for a moment before continuing, "Overall, their style of buying remains quite aggressive. This indicates that while Huayi Capital is optimistic about the subsequent rally and future breakout potential of the core 'real estate' sector, they genuinely don't hold many related chips in their hands right now."
"Mmm, I think so too," Huang Qingyun said. "And it's not just Huayi Capital; looking at the relevant core stocks in the real estate sector, domestic major institutions probably don't hold many chips either—especially when it comes to mainland property stocks in the Hong Kong market, right?"
"Previously, domestic institutions universally held relatively pessimistic expectations regarding the development of the real estate market," Men Xingtao said. "Coupled with the reasons of the overall market environment, having no corresponding positions in a pessimistic main-theme sector is entirely normal. And this... precisely created the current status where mainland property stocks in the Hong Kong market are extremely undervalued.
In the future, alongside the reversal of industry fundamentals, the profit growth of corresponding industry bellwether companies, and the elevation of industry valuations, clear value-revaluation opportunities exist within this sector.
Moreover, I believe that over the next one to two years, the sector with the greatest breakout potential will be mainland property stocks in the Hong Kong market.
After all, relatively speaking, the valuations of corresponding real estate bellwether stocks in the A-share market are still higher than those of Hong Kong mainland property stocks, and their chip structures are also more complex."
"If expectations are explicit, then right now, the chips of mainland property stocks are exceptionally precious," Huang Qingyun said. "Furthermore, as far as I know, Huayi Capital has a massive appetite. If we don't accelerate our follow-up right now, I'm afraid we won't stumble upon such cheap chips in the future."
There was still a certain gap before their fund completed its established target position-building plan.
Therefore, Huang Qingyun's idea was to take advantage of this opportunity while market sentiment remained at the bottom and the stock prices of various core mainland property stocks remained at low levels, and completely fill their fund's positions before Huayi Capital finished its target position-building for the real estate main theme.
The reason they hadn't filled their positions earlier and had remained hesitant was precisely because the future expectations of the real estate sector and the logic of asset revaluation hadn't been recognized by other major institutional funds in the market, hadn't been correctly validated by market trends, and because of insufficient market confidence looking forward amid constrained market liquidity.
But things were different now...
Huayi Capital had entered the arena fully, and its primary attack target was precisely the severely undervalued real estate sector, which harbored a massive expectation gap.
With Huayi Capital leading this main-theme rally, coupled with the fact that national housing prices had already surged dramatically, with real estate developers, urban construction, and urban investment companies across all regions mobilizing full horsepower and capital to enter the fray and grab a slice of the pie, subsequent rally expectations and the value revaluation of real estate stocks were no longer problematic.
Instead, they presented a relatively deterministic opportunity.
Thus, with concerns largely dispelled and future certainty growing increasingly robust, it naturally made sense to fill their positions as early as possible and hold low-level, scarce chips at the lowest prices.
Hearing Huang Qingyun's proposal, Men Xingtao pondered briefly before nodding with conviction:
"Alright, then let's fill our fund's positions over the next few trading sessions. Since our various analyses indicate that the real estate sector—particularly mainland property stocks in the Hong Kong market—harbors a massive expectation gap and value revaluation opportunities, we should indeed hold firm to our confidence and trust our own judgment."
As one of the many private equity firms in Shanghai, if they wanted to stand out in the fierce competition, become a star fund product in the market, and realize the dream of a ten-billion-yuan private equity firm, then holding firm to confidence, pinpointing opportunities, and making a heavy-position bet were absolute prerequisites.
Otherwise, during a bear run, net asset growth far exceeding the market average would be extremely difficult to achieve, making it hard to attract the attention of the broader fund investor community.
Once Huang Qingyun received authorization from Men Xingtao, without waiting for Men Xingtao to say more, he turned his face and immediately transmitted the trading instructions—to continue increasing positions and buying until the fund reached full capacity—to all traders in the trading room.
As his instructions were executed, and as the traders continuously bought stocks through their operating accounts, in the Hong Kong market, numerous mainland property stocks such as Evergrande Real Estate, Sunac China, Agile Group, Logan Group, Greentown China, and Country Garden once again erupted with massive volume and climbed higher.
This exerted a guiding effect on the A-share real estate sector, its corresponding core heavyweight bellwether stocks, and other property shares.
"Holy crap, look at the trend of the mainland property stocks in the Hong Kong market—truly ferocious."
Seeing the comprehensive breakout and massive surge of mainland property stocks in the Hong Kong market, and noting that Sunac China had even surged over 10% at one point, the crowd of retail investors on the online investment platform instantly let out waves of exclamation.
"A-share capital is truly freaking cowardly."
"Usually, A shares lead Hong Kong shares, but over these past two days, Hong Kong shares have been leading A shares."
"Northbound capital is still ferocious after all; domestic capital is simply too timid. Lacking sufficient certainty, they don't dare pull the market, hiding entirely inside the pharmaceutical and liquor sectors."
"Ain't that the truth, only knowing how to huddle in liquor and pharmaceuticals."
"Stop complaining. Driven by Hong Kong mainland property stocks, the panicky selling we saw earlier on the order books has already gradually recovered."
"Just now, across the order books of the four major pillars—China Vanke, Poly Real Estate, Gemdale Group, and China Merchants Shekou—multiple major buy orders exceeding tens of thousands of shares appeared simultaneously. This must be... President Su's handiwork, right?"
"Major financial sectors like banking and insurance are beginning to link up with 'real estate', 'non-ferrous metals', 'coal', and 'construction'. Looking at this situation... could it also be the 'National Team'?"
"What national team? Ever since the stock market disaster, where has the national team ever engaged in active buying?"
"It should be bottom-fishing arbitrage capital."
"I reckon the 'Huayi Expedition No. 1' major fund managed by President Su is definitely continuing to buy."
"Could it be that the tens-of-thousands-of-shares buy orders propping up the market just now were genuinely President Su's doing?"
"Who cares? If this recent wave of panic-driven dipping could be pulled back up, it proves that a market rally exists here. The real estate sector and the 'mega-infrastructure' main theme genuinely deserve their turn."
"I knew it. For the economy to develop, it still has to return to the old path centered on 'real estate'."
"I only know that housing prices across offline cities are rising universally, and real estate stocks will definitely reflect that."
"Speaking of which, the housing market is truly the real bull. For twenty years, aside from rising, it's either moved sideways and then continued rising. It's been a bull market for nearly twenty years now, yet at such high levels, it's still capable of surging rapidly."
"The core pillar of the economy—did you think it was a joke?"
"Once the housing market surges, does that mean the stock market has even less hope? After all, once enthusiasm pours into the real estate market, the stock market's liquidity will become even scarcer."
"A stock market bull run definitely has no hope in the short term, but localized rallies still exist, right?"
"If the housing market is bullish, then just speculate on 'real estate' stocks."
"Let's wait and see. Anyway, if a market rally still doesn't materialize and there isn't even a decent rebound, I plan to exit the stock market. Wouldn't it be better to use the money in my hands to buy a house?"
"Let's follow President Su and give it a try. If it doesn't make money, I'm quitting too."
Amidst everyone's discussions, market trends continued to recover during the final half-hour before the close.
Among them, the real estate sector maintained its lead, the entire 'mega-infrastructure' related sector began continuously siphoning capital, and the 'macro-financial' related sectors also initiated a bottom-rebound.
Ultimately, as 3:00 PM arrived in the afternoon, the two exchanges ushered in the market close.
The Shanghai Composite's intraday drop narrowed from an intraday low of around 1.23% down to 0.52%, while the ChiNext index maintained a sharp decline of 1.57%.
"Market polarization has seemingly grown more and more severe lately!"
After the two exchanges closed, inside Shanghai's Noah Capital, Fund Manager Wang Shujie of the 'Noah Blue Chip Hybrid Selection' fund product trading department smiled and said.
"It certainly seems to show those signs."
Trading team leader Li Shangfeng looked at the closing results of the two exchanges and the core popular sectors supporting the market trends, saying,
"Ever since the circuit-breaker stock crash at the beginning of the year, market trends have continuously tilted toward performance blue-chip stocks.
Over the past half-year and more, the stocks that have suffered the most catastrophic drops in the market are the growth concept stocks that were heavily hyped during the 2014-2015 bull market.
Conversely, performance blue-chip stocks—especially those blue chips situated in positive, high-prosperity industry cycles—have actually been universally repairing the declines chalked up by the several rounds of stock market crashes in the second half of last year and the beginning of this year.
Core blue-chip stocks like Kweichow Moutai, Wuliangye, Yanghe Brewery, Gree Electric Appliances, and Midea Group have even nearly carved out new historical highs."
"Furthermore, over the past few months, the trajectories of the A50 index and the CSI 300 index have also been clearly stronger than the Shenzhen Component and ChiNext indices.
In fact, the A50 index's overall drop this year was a mere 5%.
Actually, this market style transformation manifested relatively clearly three months ago; it's just that back then, everyone hadn't reacted yet.
Right now, many institutional players within the industry are basically opting for style conversion.
Abandoning previous small-cap growth stocks, they are beginning to embrace industry bellwethers, high-performing white horses, and defensively robust heavyweight blue chips en masse."
"It should have shifted in this direction long ago," Wang Shujie said. "Compared to mature foreign markets, this is the correct and healthy investment model. How could the previous market atmosphere of hyping small caps and junk stocks possibly endure? Only by forming a market atmosphere centered on 'value investment' can our country's stock market usher in a long-term bull market."
"However, although market capital preferences are shifting overall toward high-performing white horses and heavyweight blue chips..." Li Shangfeng paused before continuing, "the trend discrepancies among various main themes remain quite pronounced.
For instance, the liquor sector as a whole has repaired the declines of several stock market crashes and is fast approaching new highs.
However, heavyweight blue-chip stocks in sectors like steel, coal, and non-ferrous metals that have been intensely hyped by capital over the past two trading sessions are all sitting at historical bottoms. Among them, China Shenhua Energy has even just hit a record low.
Then there's the petrochemical sector; the performance of the 'Two Barrels of Oil' is also terrible.
To say the least, not all heavyweight blue chips and high-performing white horses in the market are capable of decoupling from the unendingly falling small-cap growth and concept stocks to form sideways consolidation or independent upward trajectories."
Wang Shujie nodded and said,
"Expected. This is also one aspect of the market maturing further; stocks with good performance and strong future expectations naturally ought to rise, whereas stocks trapped in a downward industry cycle with uncertain future performance ought to continue falling. There's nothing strange about that."
"Yet recently, main-theme sectors like real estate, coal, steel, non-ferrous metals, and construction have exhibited frequent anomalies.
Moreover, industry fundamentals seem to be showing signs of reversal. Additionally, according to observations from quite a few major institutional players in the industry, over the past half-year and more, the star private equity fund product 'Huayi Expedition No. 1'—which precisely bottom-fished the core stocks of the liquor, pharmaceuticals, white-goods consumption, and electric power main themes—has indeed been heavily cutting positions in 'new energy industry chain' stocks over recent days, thereby bottom-fishing heavyweight bellwether stocks in sectors like real estate, coal, steel, and non-ferrous metals."
Li Shangfeng said.
"I've certainly heard about this."
Wang Shujie shifted his gaze, smilingly looking at Li Shangfeng as he asked,
"Shangfeng, what are your thoughts on this matter?"
(End of Chapter)