2025 A-Share Market Annual Upheaval and Implications for 2026 Investment Strategy

I. Review of Core Structural Changes in A-Share Market in 2025

1. Market Overall Performance and Rhythm

Index and Market Capitalization
: The total market capitalization of A-shares exceeded 100 trillion yuan in 2025, and the Shanghai Composite Index returned to 4000 points in October. The market experienced fluctuations but moved significantly upward overall, showing obvious phased trends throughout the year.
Volatility and Resilience
: After risk events such as tariff war shocks and thousands of stocks hitting daily limits, policy support forces like Huijin’s 150 billion yuan market rescue reflected the market’s policy sensitivity and resilience.

2. Policy-Driven Market Clearing and Reconstruction

Delisting New Rules
: Implemented at the beginning of the year, promoting the clearing of junk stocks and purifying the market ecology.
Market Rescue Intervention
: After thousands of stocks hit daily limits in April, Huijin’s 150 billion yuan market rescue clarified the policy bottom line, and the market recovered quickly after the liquidity crisis.
Industrial Policies
: Directions such as AI, robotics, military industry, photovoltaics, pharmaceutical innovative drugs, semiconductor mergers and acquisitions, lithium ore production suspension, Hainan customs closure, and commercial aerospace continued to receive policy and capital support.

3. Rise of Hot Sectors and Themes

AI and Hard Technology
: DeepSeek ignited the AI computing power boom, becoming one of the strongest main themes in the market throughout the year.
Robotics Commercialization
: March was regarded as the first year of commercialization, driving the theme of intelligent manufacturing and equipment upgrading.
Military Industry and Semiconductors
: Military industry broke out, semiconductors ushered in a merger and acquisition wave, and expectations for domestic substitution and technological breakthroughs were strengthened.
New Energy Related
: Anti-involution policies in the photovoltaic industry promoted capacity clearing and industry pattern optimization; lithium ore production suspension triggered changes in supply and demand patterns.
Pharmaceuticals and High-End Manufacturing
: Hengrui Medicine’s innovative drug large orders reflected the progress of innovative drug commercialization.
Culture and Media
: “Ne Zha 2” drove short-term outbreaks in sectors like Guangxian Media.

4. Capital Style and Individual Stock Differentiation

Birth of Tenfold Stocks
: Individual stocks like Shangwei New Materials became market benchmarks, reflecting the attractiveness of structural market trends and high-growth targets.
Style Tear
: A seesaw effect appeared between technology growth and traditional weights (such as Moutai), with capital preferences shifting periodically.

II. Implications for 2026 A-Share Investment Strategy

1. Continuity of Hard Technology and AI Computing Power

Continuously Focus on AI Computing Power Infrastructure
: Industrial chain links such as computing power chips, optical modules, servers, and IDCs are expected to continue to benefit.
Domestic Substitution and Technological Breakthroughs
: Directions like semiconductors, GPUs, advanced packaging, materials and equipment are expected to be driven by both policy and capital.
Robotics and Intelligent Manufacturing
: Commercialization landing accelerates; focus on components, system integration, and application scenarios.

2. Policy-Driven Sector Opportunities

Industrial Policy Dividends
: Focus on policy-intensive areas such as pharmaceutical innovation, military industry upgrading, new energy industry pattern optimization, commercial aerospace, and Hainan customs closure.
SOE Reform and Mergers & Acquisitions
: The semiconductor merger wave and securities industry aircraft carrier mergers reflect the trend of increasing industry concentration.
Continuation of Delisting New Rules
: Survival of the fittest accelerates; focus on high-quality leaders with core competitiveness.

3. Market Risks and Responses

External Shocks
: Need to remain vigilant against external risks like tariff wars, but policy support expectations reduce extreme risks.
Liquidity Changes
: Policy market rescue indicates the importance of liquidity management; need to pay attention to changes in the macro liquidity environment.
Style Shift
: Rotation between technology growth and traditional weights will continue; need to respond flexibly.

4. Sector Rotation Rhythm

Rhythm Grasp
: Dynamically adjust allocation based on policy rhythm, industrial cycle, and market sentiment.
Balance Between Thematic and Value
: Need to balance thematic investments (AI, robotics, commercial aerospace, etc.) and value investments (pharmaceutical innovation, high-end manufacturing, new energy, etc.).

III. 2026 Investment Strategy Recommendations

Hard Technology Core Positions
: Focus on allocating to directions with strong long-term growth, such as AI computing power, semiconductors, robotics, and high-end manufacturing.
Policy Dividend Areas
: Policy-supported areas like pharmaceutical innovation, military industry, new energy optimization, commercial aerospace, and Hainan customs closure.
High-Quality Leading Targets
: Focus on high-quality companies with solid fundamentals and core competitiveness under the background of delisting new rules.
Combination of Thematic and Value
: Seize short-term thematic opportunities while laying out long-term value investment targets.
Risk Hedging
: Pay attention to external shock risks, maintain portfolio flexibility and liquidity management.

IV. Risk Tips

Policy Implementation Falling Short of Expectations
: Industrial policies, delisting new rules, etc., may face implementation deviations.
Market Sentiment Fluctuations
: The volatility of thematic investments increases; need to be vigilant against chasing high risks.
External Shocks
: External factors like tariff wars may affect market risk appetite periodically.

References

User-provided monthly event background of the 2025 A-share market (DeepSeek, AI boom, delisting new rules, tariff war, Huijin market rescue, tenfold stocks, Cambricon surpassing Moutai, etc.).
Shanghai Stock Exchange 2025 Market Overview (A-share total market capitalization exceeding 100 trillion yuan, Shanghai Composite Index returning to 4000 points).
Kitco News (Impact of 2025 China-US trade war on global markets, gold price hitting a new high).
Comprehensive news and market data (2025 A-share policy intervention, ETF expansion, impact of tariff war on global markets).

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