The 3000-point defense battle has started again, how long will it take to rebound? Historical data says so

Finance Associated Press

2024-06-25 18:25Published on the official account of Cailianpress, a subsidiary of Shanghai Shanghai Poster Industry Group

Finance Associated Press, June 25 (edited by Zilong), today (June 25), the Shanghai Composite Index fell again, as of the close, it has been 5 consecutive days of yin, and the cumulative adjustment in the past 1 month is nearly 6.6%. According to the statistics of the closing price of the index, since falling below 3,000 points on June 21, the Shanghai Composite Index has now been below this important threshold for three consecutive days, and at the same time, its lowest point recorded in today's intraday session hit a new low in nearly four months since late February this year.

The 3000-point defense battle has started again, how long will it take to rebound? Historical data says so

Note: The Shanghai Composite Index has been declining recently (as of the close of trading on June 25)

A review of the key points of the Shanghai Composite Index shows that the number of losses has decreased in recent years

The 3,000-point mark of the Shanghai Composite Index has long been regarded by the market as an important support level, and it is also a symbol of confidence in the minds of investors. Looking back on the history of A-shares, the Shanghai Composite Index has launched more than 50 "3,000-point defense battles", and the previous defense battles are often accompanied by large fluctuations in market funds and investor sentiment. However, from the perspective of the market alone, the Shanghai Composite Index was below 3,000 points for nearly half of the time, mainly concentrated before 2015, especially between 2011 and 2014, when the Shanghai Composite Index experienced the longest defense battle.

Note: Daily closing price of the Shanghai Composite Index since 2008 (as of the close of trading on June 25)

In terms of specific data, since the Shanghai Composite Index first stood at 3,000 points (February 26, 2007), there have been 4,216 trading days during the period, of which the closing price of 2,028 trading days was lower than 3,000 points, accounting for nearly 48.1% of the total. In the market (2304 days) since 2015, only 602 days have been below 3000 points, accounting for a significant decrease (26.1%). According to annual statistics, in the past two and a half years since 2021, the number of days below 3,000 points in the Shanghai Composite Index has decreased significantly compared with before, and the number has not exceeded 50 days in all previous years.

Note: Number of dates in which the Shanghai Composite Index has been below 3,000 points in any calendar year since February 26, 2007 (as of the close of trading on June 25)

At present, the Shanghai Composite Index has fallen below 3,000 points again, with the closing price, a total of 3 trading days below the key point, at the same time, the market turnover continued to shrink, as of today's close, the turnover of the two cities is only 648.2 billion yuan, the fifth lowest value this year. In addition, in this month's market, there have been 5 trading days of less than 700 billion yuan, and the trading sentiment has cooled. In the situation of the loss of key points and the continuous decline of transaction data, the market is also focused on the extent of the retracement of this round of Shanghai Composite Index and when the defense battle will end.

Looking back at the pass defense battles in recent years, the downward phase lasted an average of 13 days

Since 2015, based on the closing price statistics, excluding this market, the Shanghai Composite Index has gone through a total of 36 battles to defend 3,000 points, of which 11 times were the next day to regain key points, accounting for nearly a quarter. In the remaining 25 defensive battles, the average duration was nearly 23.5 days (median 6 days), and the average duration of the downward stage was nearly 13.4 days (median 3.5 days), accounting for nearly 60% of the entire period. Among them, 8 times lasted more than 30 days, mainly in 2019 and 2016.

Note: After 2015, the Shanghai Composite Index has defended 25 times of 3,000 points (this market is not counted and the key point is recovered the next day is not calculated)

In terms of the retracement during the downward phase of the above 25 defense battles, the Shanghai Composite Index fell by nearly 3.5% on average, of which the retracement from June 19, 2018 to January 3 of the following year, January 20 to 28, 2016, and March 9 to 23, 2020 ranked among the top three. However, these three stages of defense also recovered rapidly in the subsequent rebound period, with the Shanghai Composite Index rising nearly 22.9%, 13.7%, and 13.8% respectively. Overall, the downside of the Shanghai Composite Index below 3,000 points is limited, and the duration and frequency of the index have gradually decreased in recent years.

Note: The annual distribution of 25 3,000-point defense battles of the Shanghai Composite Index after 2015 (excluding this market and recovering key points the next day, and counting the end date of the defense battle)

In addition, the most recent 3,000-point defense battle lasting more than 2 days was between December 13, 2023 and February 23 this year, which lasted for 45 trading days, and was in a downward phase on the 38th, with a cumulative adjustment of nearly 9% in the index, and a rapid rebound in the next 7 days, with a total recovery of nearly 11.2%. In terms of industries and sectors, the computer, media, communications, electronics, and military sectors were among the top decliners at that time, while small and medium-cap stocks and the Beijing Stock Exchange 50 Index fell more than two percent at that time, and the downward section fell by more than two percent, however, these directions rebounded rapidly in the future.

(Finance Associated Press Zilong)

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