On the first trading day after the National Day holiday, the three major A-share indexes surged more than 10%

On October 8, the A-share market made a remarkable comeback, surging over 10% right after the Golden Week holiday. The three major indices delivered exceptional results: the Shanghai Composite Index jumped by 10.13%, the Shenzhen Component Index rose by 12.67%, and the ChiNext soared an impressive 18.44%. More than a thousand stocks posted gains exceeding 19%, marking a noteworthy rally in an otherwise bearish Asian market environment.

In stark contrast, other Asian markets encountered challenges on the same day. Hong Kong’s Hang Seng Index dipped by 1.08%, while the Hang Seng Tech Index fell by 1.73%. Japanese stocks experienced a decline of nearly 300 points, and Korean equities dropped over 0.5%. Taiwan’s market also saw a downturn, falling by more than a hundred points. Notably, the FTSE China A50 futures flipped from a 1.6% gain to a loss exceeding 1%.

To sustain the positive momentum of the A-share market, Zheng Chajie, head of the National Development and Reform Commission, is set to hold a press conference today. The market looks forward to receiving more bullish signals from the government, indicating a strong commitment to bolstering the stock market.

Despite the A-share market being closed during the holiday, major exchanges and brokerage firms were busy. New account openings reached historic highs, and brokerages leveraged the time off for system expansions and rigorous stress testing of their information systems. To better accommodate new investors, the Shanghai Stock Exchange extended the submission window for designated trading orders from 9:15 AM to 9:25 AM and 9:30 AM to 11:30 AM, now making it 9:15 AM to 11:30 AM and 1:00 PM to 3:00 PM each trading day.

Encouraged by the resurgence in A-shares, Hong Kong stocks—remaining open during the holiday—performed strongly. On October 7, the Hang Seng Index rose by 1.6%, while the Hang Seng Tech Index climbed 3.05%, both reaching their highest levels since February 2022.

International investors are also casting their eyes on Chinese companies, with Bloomberg reporting a remarkable inflow in emerging market-focused ETFs. In the week ending October 4, a record $5.96 billion flowed into these ETFs, the highest influx in over a year. A significant portion, about $4.9 billion, went into five key ETFs that focus on Chinese stocks, setting unprecedented levels.

Several foreign investment firms have reevaluated their outlook on A-shares. Goldman Sachs projects a potential upside of 15% to 18% for total returns from current levels, while Morgan Stanley believes that if the Chinese government announces additional spending measures in the upcoming weeks, the Chinese stock market could see further growth of 10% to 15%.

Prominent Chinese economist and former chief economist at Evergrande Group, Ren Zeping, recently shared his insights on Weibo, predicting a swift opening for the A-share market. He even suggested that investors might consider leaving work early to take advantage of the situation. “I advised holding onto stocks during the holiday,” he remarked.