A-Share Market Surges on Policy Easing and New-Quality Productivity Momentum

Policy Easing Intensifies and New-Form Productive Forces Synergize: A Three-Part Deconstruction of the A-Share Market’s Broad-Based, High-Volume Rally

On April X, the A-share market delivered a long-awaited, broad-based, strong rally: the Shanghai Composite Index rose 1.18%, the Shenzhen Component Index surged 2.27%, and the ChiNext Index soared over 3%—all three indices simultaneously breaking above their short-term moving averages. Nearly 4,600 stocks advanced—over 92% of all listed shares—with 152 hitting daily trading limits (the “upper circuit”) and only three hitting daily lower limits (“lower circuit”). This rally—marked by simultaneous gains in both price and volume, and exceptional breadth—far exceeds a mere technical rebound. It signals a pivotal market transition: from “expectation-driven speculation” to “earnings-driven realization.” Notably, leadership was highly concentrated across just four thematic pillars—securities, computing infrastructure hardware, nonferrous metals (especially copper foil), and shipping—whose synchronized surge was no random rotation, but rather the deep resonance of three converging forces: monetary policy easing, accelerated deployment of new-form productive forces, and global supply-chain rebalancing.

Liquidity Turning Point Confirmed: PBoC’s RMB 20.65B Net Injection Sends Clear Stabilization Signal

On the day, the People’s Bank of China (PBoC) conducted RMB 34.2 billion worth of 7-day reverse repos while only RMB 13.55 billion matured, resulting in a net liquidity injection of RMB 20.65 billion—the highest single-day net injection in the past three months. The repo rate remained unchanged at 1.4%. This move was not isolated: over the preceding week, the PBoC had executed net injections for four consecutive days, totaling RMB 49.2 billion. Meanwhile, March’s M2 growth accelerated to 8.8% year-on-year, and aggregate social financing (ASF) stock growth held steady at 8.7% YoY; corporate medium- and long-term loans continued improving in structure. This tangible improvement in liquidity conditions directly catalyzed a recovery in market risk appetite. The securities sector led gains that day (the SW Securities Index rose 4.2%), functioning both as the market’s “barometer” and as the most direct beneficiary of enhanced liquidity—bolstering brokers’ capital intermediary functions, raising expectations for higher margin financing balances, and signaling marginal improvements in IPO and refinancing activity. Crucially, this easing is not “flood irrigation,” but rather “precision drip irrigation”: the unchanged repo rate reflects policymakers’ firm commitment to a “prudent” stance, while funds are channeled deliberately toward weak links in the real economy and strategic national sectors—laying the groundwork for future structural rallies.

New-Form Productive Forces Accelerate Deployment: Computing Hardware and Copper Foil Emerge as Core Physical Enablers

Policy guidance on “new-form productive forces” has shifted decisively from top-level design into implementation phase. The National Development and Reform Commission (NDRC), jointly with nine other ministries, has launched a three-year special campaign targeting energy conservation and carbon reduction in key industries. While ostensibly focused on traditional high-energy-consumption sectors, the initiative harbors a dual strategic intent: first, it compels foundational materials industries—including steel, electrolytic aluminum, and cement—to upgrade production processes and enhance energy efficiency, thereby securing greener, more stable upstream inputs for advanced manufacturing; second, by curtailing inefficient capacity and freeing up energy-consumption quotas, it creates valuable resource space for strategic emerging industries such as AI, semiconductors, and new energy. Against this backdrop, computing hardware (servers, optical modules, liquid-cooling systems) and copper foil have emerged as the two most critical physical enablers of new-form productive forces.

The computing hardware segment led technology-sector gains that day, propelled primarily by an unexpectedly accelerated pace of domestic substitution. Surging demand for large-model training within China—and the scaled rollout of AI applications across government, finance, and telecom sectors—has resulted in robust orders for domestic GPU servers. Optical module manufacturers have achieved over 90% yield rates for their 800G products, and liquid-cooling adoption rose 15 percentage points quarter-on-quarter in Q1. The validation chain is clear and complete: from chip design (Cambricon, Hygon Information) to system integration (Sugon, Inspur), and onward to thermal management solutions (Envicool, Tongfei Co.), the path to earnings realization is increasingly well-defined.

Copper foil, meanwhile, anchors another vital thread—advanced packaging and high-frequency, high-speed printed circuit board (PCB) upgrades. Demand for electronic-grade copper foil—originally developed for lithium-ion batteries but now extended into HDI (high-density interconnect) boards and IC substrates—is exploding. Its technological barriers far exceed those of conventional battery copper foil. Leading domestic producers have already mass-produced 4-micron ultra-thin copper foil, achieving yields above 85% and successfully entering the supply chains of top-tier international OSATs. Escalating Red Sea disruptions further perturb global PCB supply chains, heightening the urgency of domestic substitution. The copper foil rally thus embodies the concrete manifestation of the “technological self-reliance” thesis at the materials level.

Resource Security and Global Restructuring: The Synchronized Logic of Nonferrous Metals and Shipping

The nonferrous metals sector (SW Nonferrous Metals Index +3.8%) led gains—not merely driven by copper prices breaching USD 10,500/ton, but underpinned by deeper structural logic. First, “resource security” has ascended to the status of national strategy: the NDRC’s energy-conservation campaign explicitly identifies electrolytic aluminum as one of its nine priority industries, implying a further hardening of China’s domestic electrolytic aluminum production cap over the next three years. Combined with sustained copper and aluminum demand from NEVs, PV installations, and grid investments, this points toward a structurally tight supply-demand balance. Second, the shipping sector rallied in tandem (COSCO Shipping Holdings and China Merchants Energy Shipping hit upper circuits)—not simply as a play on Red Sea risks. While the Shanghai Containerized Freight Index (SCFI) has rebounded 42% from its year-start low, the more critical driver is the onset of a restocking cycle: U.S. and European retailers’ inventory-to-sales ratios have fallen to near five-year lows, and China’s Containerized Freight Index (CCFI) has risen for five consecutive weeks—suggesting Q2 external demand recovery will converge with domestic demand revival, driving a material uptick in raw-material import demand. The联动 (synchronized movement) between resources and shipping thus serves as a microcosm of China’s strengthened role as a manufacturing hub amid global supply-chain restructuring.

From Speculation to Realization: Growth-Style Valuation Recovery Enters a Solid Phase

Historical experience shows that sustainable rallies in A-share growth-style equities require the simultaneous convergence of three elements: improved liquidity, confirmed industrial trends, and verifiable earnings. Today’s market satisfies all three: the PBoC’s RMB 20.65 billion net injection solidifies the liquidity foundation; industry data—server order books, copper foil yields, and electrolytic aluminum capacity constraints—continuously validate progress on new-form productive forces; and Q1 earnings previews indicate median YoY net profit growth of 28% for SW Electronics, 35% for SW Computers, and 41% for SW Power Equipment. The market is finally breaking free from last year’s cyclical pattern—“policy rhetoric → repeated speculation → disappointment and pullback”—and shifting toward a virtuous feedback loop: “policy implementation → order conversion → earnings realization.” For investors, identifying core themes demands looking beyond surface appearances: the securities sector represents not just a liquidity beta, but also an alpha vehicle for deepening capital-market reform; computing hardware and copper foil signify not merely technological breakthroughs, but irreversible milestones in domestic substitution; and nonferrous metals and shipping reflect not just cyclical fluctuations, but the barometer of a broader rebalancing—between global resource allocation rights and China’s manufacturing voice.

This high-volume rally is no fleeting pulse—it marks the opening chapter of China’s capital markets in the era of new-form productive forces. When policy levers and industrial engines operate in perfect synchrony, high-quality assets possessing genuine core technologies, occupying critical nodes in value chains, and demonstrating global competitiveness will inevitably embark on enduring bull runs—propelled by the dual drivers of valuation recovery and earnings growth.