On July 17th, the market experienced a full day of fluctuating divergence. By the close, the Shanghai Composite Index fell by 0.45%, the Shenzhen Component Index fell by 0.47%, and the ChiNext Index rose by 0.01%. The Northbound 50 closed up by 7.2%, at 759.27 points, with all 50 constituent stocks turning red across the board. Tianfang Standard and Zhongfang Standard achieved a "30CM" daily limit up, while Jigang Precision and Zhuozhao Adhesive rose by more than 20%.

According to data from the official website of the Beijing Stock Exchange, the Northbound 50 accumulated a transaction volume of 12.976 billion yuan on the same day, with a trading volume of 1.335 billion shares, which is 1.24 times higher than the transaction volume on July 16th. This is also the first time the index has returned to a single-day transaction level of over ten billion yuan after a gap of four months.

The strong rebound of the index also led to a warming up of the overall market at the Beijing Stock Exchange, with over 90% of the 249 listed stocks achieving gains in the past two trading days.

The strong rebound of the Northbound 50 is considered by industry insiders to be influenced by multiple factors, including the market's oversold rebound, favorable mid-year report performance, and recent style shifts in the A-share market.

Some analysts from the New Third Board also told reporters that during the recent two-day surge, the stock trading logic of the Northbound 50 stocks has changed, "On the 16th, the capital pulled the concept small tickets, and on the 17th, both concept tickets and performance tickets rose together." The analysis suggests that the significant rise in some active concept small tickets brought a profit effect, which then developed into a collective surge across the entire market of the Beijing Stock Exchange.

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However, some market participants have warned that although the Beijing Stock Exchange currently has a significant short-term profit effect, it is also prone to accumulating short-term profit-taking positions and selling pressure risks, and investors should be cautious about chasing highs.

The rebound was aided by factors such as an oversold market.

After breaking through the important psychological level of 700 points at the beginning of the month, the Northbound 50 has rebounded strongly in the past two trading days, with both volume and price rising. So far this week, from Monday to Wednesday (July 15th to 17th), the daily trading volume of the index was 306 million shares, 633 million shares, and 1.335 billion shares, respectively, with transaction volumes of 2.907 billion yuan, 5.798 billion yuan, and 12.976 billion yuan, respectively.

The last time the Northbound 50 stood above 750 points was over a month ago, after which it fell all the way down, reaching a historical low of 658.17 points at the beginning of this month. The single-day transaction volume exceeding ten billion yuan dates back to early March of this year.The index has seen two consecutive days of substantial volume increases and significant gains. Who is the "bellwether" among the constituent stocks?

Looking at the situation on July 17th, among the 50 constituent stocks of the Beijing Stock Exchange (BSE), Tianfang Standard and Zhongfang Standard hit the daily limit up, while Zhuozhao Adhesive and Jigang Precision rose by more than 20%. Additionally, 11 stocks including Xingchen Technology and Fengguang Precision increased by over 10%.

In terms of trading volume indicators, Zhongfang Standard and Tianfang Standard were the top two in terms of transaction volume for the day, with 275 million yuan and 229 million yuan respectively, and including these two stocks, a total of 9 individual stocks had transaction volumes exceeding 100 million yuan. In terms of trading volume, Air China Ocean Shipping traded over 30 million shares, with a total of 7 individual stocks breaking through the 10 million share mark.

The day before, on July 16th, the leading stocks of the BSE 50 were Lierda and Hengjin Induction, which closed up by 14.86% and 13.43% respectively.

Why has the BSE 50 rebounded strongly? Analysts believe it is due to multiple factors, including oversold rebound, the need for valuation repair, semi-annual report performance, and buyback benefits that further support valuations.

Zhou Yunnan, the founder of Beijing Nanshan Investment, told reporters that the BSE's adjustment over several months has led to a "golden pit" in the stock prices of BSE-listed companies, with strong rebound momentum.

Data shows that as of July 16th, 43% of the stocks on the BSE had a price-to-earnings ratio of less than 20 times, making the entire sector cost-effective for allocation. Even after a corrective rise, the BSE 50 has still seen a decline of nearly 30% year-to-date, which is still greater than the decline in other sectors.

"The recent substantial volume increase and significant gains in the BSE are the continuous fermentation of incremental funds rushing in after a long period of decline, and the bottom-fishing rebound," said Yu Wei, an expert from the Economic Development Working Committee of the China Xiaokang Construction Research Association. The core reason for the substantial volume increase and significant gains in the BSE's secondary market is the continuous entry of incremental funds for bottom-fishing.

In addition, some analysts also mentioned that the surge in the BSE is also influenced by a shift in market style. Recently, there has been a trend in the market trading style shifting from a focus on dividends and stable attributes of large-cap stocks to technology and growth attributes of small and medium-cap stocks. At the same time, the semi-annual report performance and buyback benefits of the BSE further support valuations.

How will the market evolve in the future?Following a single-day surge of 7%, the future trajectory of the Beixin 50 index and whether it will experience a pullback after a rally have become market concerns.

Zhou Yunnan cautions that although the Beixin 50 has a significant short-term profit-making effect, it may also compress the rebound time, accumulating short-term profit-taking positions and selling pressure risks, so investors need to pay attention to the risk of chasing gains in individual stocks.

Yu Wei also mentioned the need to monitor whether the overall trading volume of the Beixin 50 and the Beijing Stock Exchange can steadily increase.

At the same time, it is currently the mid-year reporting season for A-shares, and several companies listed on the Beijing Stock Exchange have also successively disclosed their mid-year performance, with overall impressive results.

According to Wind data, nine companies listed on the Beijing Stock Exchange, including Yishi Precision, Haidaer, and Changfu Shares, have disclosed their interim performance, with six expecting an increase, one continuing to be profitable, and two turning losses into profits.

Among them, Jinbo Biotech is expected to achieve a net profit of about 290 million to 310 million yuan in the first half of this year, a year-on-year increase of 165% to 183.28%; GuoHang Ocean is expected to achieve a net profit of about 60 million to 80 million yuan in the first half of the year, a year-on-year increase of 263.27% to 384.36%.

Changhong Energy and Parallel Technology are expected to turn losses into profits. Among them, Changhong Energy is expected to achieve a net profit of about 80 million to 90 million yuan in the first half of this year, a year-on-year increase of 198.06% to 210.32%, with a net profit of -81.58 million yuan in the same period last year.

Open Source Securities believes that as the mid-year report disclosure window approaches, the Beijing Stock Exchange is expected to start a mid-year report market, and it is recommended to pay attention to companies with better mid-year report performance.

The aforementioned analysts also mentioned that mid-year report performance and share repurchase benefits will further support the valuation repair of the Beijing Stock Exchange. In addition, several companies listed on the Beijing Stock Exchange have recently announced share repurchase plans in succession, in an effort to stabilize stock performance and provide certain support for investor confidence.