Market hits low with minimal trading volume on September 18

Today marks the 93rd anniversary of the September 18th Incident. The victory in the War of Resistance was hard-won, and peaceful development has not come easily. The A-share market also has its own "September 18th"—after a slightly higher opening, the market continued to decline intraday, hitting a new low at 1:30 PM before bargain-hunting funds stepped in, lifting the index. A glance at the trading volume shows less than 480 billion yuan in turnover across the two markets (with the absence of northbound capital as an alibi, we might see around 600 billion yuan tomorrow).

The U.S. stock market chart shows consolidation at historical highs, though it’s hard to accurately describe a bull market with the term "top." At 2 AM Beijing time on the 19th, the Federal Reserve's interest rate meeting will decide on the rate cut (or a possible reverse cut—who knows?). Currently, betting sites favor a 50-basis-point cut. Of course, if this marks the first rate cut in two or three years, it likely won’t be the last, with rates potentially gradually dropping to the 3% range. The liquidity from rate cuts could significantly raise the 阶段性底部 of Hong Kong stocks, with offshore Chinese assets feeling the most direct impact.
 

Yesterday, I mentioned that if today’s low opening hit a freezing point, I’d consider adding positions—mainly in oversold real estate and lithium battery sectors. Real estate rebounded in the afternoon, and after the close, I saw a screenshot from a 网友 showing a notice on the Bank of Communications app about reducing 存量房贷 rates for first-time buyers. During the holiday, there were also 冷处理 messages about mortgage 违约 risks, all pointing to a 存量处理 approach to avoid banks facing pressure from 二手 housing foreclosures. The lithium battery adjustment was partly linked to the 黎巴嫩 pager 遥控爆炸 incident this morning, but later 检查 results showed the pagers had been internally modified with explosives, not caused by lithium battery explosions. Overall, real estate + lithium 电池 is an oversold 反弹 play.

The market’s low volume at current levels could lead to a dead cat bounce followed by one final drop. Given the recent 大规模宣传 of the CSI A500 broad-based index by financial institutions, it would be more in line with human nature to see a bottom only after these 机构自购筹码 are dumped (经验上讲， institutions often hold the 最后一棒 of the short side). After all, it seems unlikely that the big players would let so many 筹码抄到底 so easily.