China's Shanghai Composite Index opens down 0.6% to 4,085.90

China's Shanghai Composite Index opens down 0.6% to 4,085.90

China’s Shanghai Composite Index closed higher on Thursday, rising 0.66% to 4,109 points, reversing a 0.96% decline recorded the previous day. The rebound was driven by gains in technology and power sectors, with Sanan Optoelectron (10.03%), Shanghai Electric (10.00%), and Hengli Petrochemical (6.90%) among the top performers according to market data. However, energy and industrial stocks lagged, as Jiangsu Lianyungang (-3.97%), Sinopec (-3.78%), and Petrochina (-3.10%) posted significant losses.

The index’s performance came amid a challenging economic backdrop, including Beijing’s revised 2026 GDP growth target of 4.5%–5%, the lowest since the early 1990s, and ongoing deflationary pressures. The 15th Five-Year Plan emphasizes boosting innovation, high-tech industries, and household consumption to stimulate growth. Externally, markets were influenced by easing inflation concerns globally, though tensions between the U.S. and Iran remained a risk.

For context, the Shanghai Composite has risen 21.52% year-to-date as of March 5, 2026, despite the recent volatility. Analysts project the index to reach 4,154.69 by the end of the quarter, with a 12-month forecast of 3,825.16. The Shenzhen Component also gained 1.23% to 14,089, breaking a two-day losing streak.

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