Chinese equity markets closed out January with a measured but notable advance: the Shanghai Composite rose 3.76 for the month and finished above the 4,100-point mark after a mid‑month surge to decade highs followed by a period of narrow consolidation. The market’s texture was uneven, with smaller tech and commodity names outperforming while some large‑cap benchmarks showed signs of fatigue.
The STAR Market’s Sci‑Tech 50 index led the charge, gaining more than 12 percent in January, while the large‑cap SSE 50 exhibited a weaker profile and produced a run of daily losses earlier in the month. Liquidity was a conspicuous feature of the rally: combined turnover on the Shanghai and Shenzhen exchanges exceeded ¥2.5 trillion for 20 consecutive trading days, underscoring active participation from both retail and institutional investors.
January’s rotation of leadership highlighted two dominant themes. Precious metals and miners were the month’s biggest surprise, propelled by spot gold and silver hitting fresh historical highs. Leading the pack, Zijin Mining climbed to record levels and a clutch of smaller miners delivered extraordinary returns — Hunan Silver rose about 175 percent and Sichuan Gold jumped roughly 137 percent — drawing attention to the commodity tailwinds now feeding through the A‑share market.
Technology and thematic plays also enjoyed episodic strength. Stocks tied to AI applications staged sharp rallies, with firms such as Zhuoyi Information approaching 100 percent gains and advertising group BlueFocus doubling in price. Commercial space names reappeared on investors’ radars as well, with China Satellite Communications rallying to new highs and briefly surpassing a ¥200 billion market capitalisation.
Taken together, the market’s January action signals a selective, liquidity‑driven upswing rather than a broad‑based cyclical recovery. High turnover and narrow sector leadership raise the prospect of continued volatility: investors chasing doubled or tripled small‑cap stories face heightened drawdown risk if commodity prices or sentiment shift, while weakness among blue‑chip names leaves index‑linked flows and passive funds sensitive to future rebalancing. Policymakers’ stance on liquidity and any change in global commodity or rates dynamics will be pivotal for sustaining gains.