External factors continue to disrupt | A-share three major indices all decline over 3% | After consecutive declines, the market is expected to test the short-term bottom

March 23, the three major A-share indices all fell more than 3%, with the Shanghai Composite Index dropping below 3,800 points intraday. On the market, most stocks declined, with nearly 5,200 stocks falling and over 100 hitting the daily limit down. Only a few sectors, such as coal, oil, and natural gas, rose. Industry analysts believe that in the short term, ongoing geopolitical tensions continue to suppress market risk appetite, and investors should pay attention to news developments.

Coal defies the trend and strengthens

According to Xinhua News Agency, U.S. President Trump issued a threat on the 21st, demanding Iran open the Strait of Hormuz within 48 hours or face destruction of its power plants. The Iranian Islamic Revolutionary Guard Corps issued a statement saying that if the U.S. attacks Iran’s power stations, Iran will retaliate against Israel’s power plants and regional countries supplying power to U.S. military bases.

Amid ongoing geopolitical tensions, international oil prices surged. On the 23rd, ICE Brent crude and NYMEX WTI crude oil prices both exceeded $100 per barrel during trading, with gains of over 2%. Since early 2026, these two benchmarks have increased by more than 70%. On Monday, Asia-Pacific markets were under pressure. The Nikkei 225 fell 3.48% to 51,515.49 points. South Korea’s Kospi dropped 6.49% to 5,405.75 points. The three major A-share indices all declined over 3%, with the Shanghai Composite once falling below 3,800 points intraday and closing down 3.63% at 3,813.28 points; the Shenzhen Component Index fell 3.76%, and the ChiNext Index declined 3.49%. Total trading volume across Shanghai and Shenzhen was 2.43 trillion yuan, up 144.7 billion yuan from the previous trading day.

Market-wise, stocks broadly declined last week, with nearly 5,200 stocks in the red, over 100 hitting the daily limit down, and only a few sectors like coal, oil, and natural gas rising. Under the backdrop of high international oil prices, coal stocks attracted capital and rose against the trend, with Yun Coal Energy, Liaoning Energy, and Bomaike hitting the daily limit, and Shanxi Coking Coal reaching the limit up. Space photovoltaic concept stocks were active, with Huamin Shares up 20%, and Tuori New Energy, Xineng Technology, Lixin New Energy, and Zhejiang New Energy all hitting the limit up. Robot concept stocks also showed strength, with Jinfeng Technology and Zhongda Lide hitting the limit, and Wolong Electric Drive up over 8%.

The precious metals sector continued to adjust, with Chifeng Gold, Shengdian Resources, and Sichuan Gold hitting the limit down, while China Gold and Hunan Silver also declined sharply. On the news front, on March 23, spot gold prices in London plunged sharply during trading, briefly falling below $4,100 per ounce, hitting a new low since November last year. Additionally, themes such as AI applications, cloud computing, semiconductors, and commercial aerospace declined, with basic metals, aviation, tourism, agriculture, brokerages, and real estate sectors leading declines.

Short-term downside limited

The Shanghai Index gapped down at the open on Monday, oscillated lower, and although it rebounded slightly at the close, overall it remained weak. Investors are generally concerned: how much room is there for further correction? Where is the bottom?

Based on historical trends and current levels, Jufeng Investment believes that the current correction may be approaching a key support zone. Looking back over the past 20 years of the A-share market, every major rally from a bottom has not been smooth sailing; bull markets often involve several significant pullbacks. Since this rally started, it has not experienced a full correction, so this decline can be seen as a normal buildup phase. Since March 3, the index has fallen nearly 9%, and historically, each bull market has experienced multiple corrections exceeding 10%. Using a 10% typical correction as a reference, the bottom area would be around 3,700 to 3,800 points.

“Currently, the index is approaching 3,800 points, indicating that short-term correction space is limited. However, proximity does not mean an immediate reversal,” said Jufeng Investment. They expect the market to oscillate around 3,800 to 4,000 points, gradually digesting upward pressure through fluctuations and waiting for sentiment and liquidity to recover.

Ping An Securities believes that the ongoing U.S.-Iran conflict remains the main pricing anchor for global assets. Until the situation clarifies, equity market volatility may persist, with a defensive style favored. Investors should closely monitor news developments.

Reporter: Chen Hui