Shanghai's Winning Streak Ends: Market Consolidates Amid Mixed Sector Performance

China's Shanghai stock index ended a nine-day winning streak as investors took profits. Despite holdings steady, the index is up 18% this year. Gains were seen in AI and semiconductor sectors, while real estate and healthcare declined. Analysts forecast an upward trend with sector rotation.

China's stock market took a breather as the Shanghai Composite index ended its impressive nine-day winning streak on Tuesday, closing flat at 3,965.12. This pause follows what was the index's best performance run since September 2024, accumulating an 18% gain for the year.

While the broader market remained stable, sectors displayed varied performances. The blue-chip CSI300 index edged up by 0.3%, buoyed by the artificial intelligence sector's 1.3% rise and a 0.9% gain in the semiconductor sector. The defense sector also saw notable growth, surging 1.4% amid China's live-fire drills around Taiwan.

Underperforming sectors included real estate, which fell by 2.3%, and healthcare, down by 0.7%. Despite the mixed day, analysts at Pacific Securities emphasize emerging bullish trends and anticipate broad market gains, pointing to low option volatility. Meanwhile, Hong Kong's Hang Seng Index rose by 0.9%, marking a strong session for new listings.

(With inputs from agencies.)