Chinese stocks continued their upward trend on August 21, following gains from the previous day. The rise was positively influenced by the Chinese government's announcement of potential additional stimulus measures. The Shanghai Composite Index closed up 0.04% at 3,905.20, the Shenzhen Component Index rose 0.87% to 14,094.17, and the ChiNext Index increased by 1.43% to 3,545.58.
On the same day, a spokesperson from the Ministry of Finance stated at a press conference that new policies and measures to strengthen cooperation between fiscal and financial policies are under ongoing research, with expectations for additional policies to be announced in the second half of the year. This follows the People's Bank of China's decision to keep the Loan Prime Rate (LPR) unchanged for the 15th consecutive month. Market sentiment suggests that while interest rates may not be lowered, significant stimulus measures are anticipated.
However, the rise in U.S. Treasury yields limited the gains in the Chinese stock market. Although the U.S. increased its buyback limit for Treasury bonds to $4 billion, which had previously eased rising yields, they turned upward again on this day. Higher Treasury yields can pressure technology stocks with high valuations.
In a report, Zhao Shang Securities noted, "As liquidity has improved in August, risk appetite has shown signs of recovery, and the market continues to rebound. With the earnings season approaching, market attention will shift to individual stock performances."
The lithium sector showed strong performance on this day. Rongjie Co. hit its upper limit, while Tianhua Xinneng and Guocheng Huangye also recorded significant gains. On August 21, the price of lithium carbonate rose by 500 yuan per ton to 151,600 yuan. Additionally, lithium battery production is expected to reach an all-time high this month, with forecasts indicating a 7-9% increase compared to the previous month.
Shares related to immersion cooling also saw gains, with Rike Chemical and Feilong Co. reaching their upper limits. Following NVIDIA's adoption of next-generation cooling distribution units (CDUs), reports suggest that Google may also adopt CDUs, providing a boost to the sector. According to a report from China International Capital Corporation, "Data centers are evolving towards immersion cooling architecture, and the market for liquid cooling pumps for servers is expected to experience explosive growth."
Meanwhile, the People's Bank of China set the yuan's central parity rate against the dollar at 6.7817 yuan, an increase of 0.0009 yuan from the previous day, reflecting a 0.01% decline in the value of the yuan.
* This article has been translated by AI.
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