Short-term ceasefire hopes are slim! The Asia-Pacific markets surged then pulled back; keep a close eye on these two main trends moving forward.

Ask AI · Chemical Sector Performance Surges — How Do Rising Oil-Price Expectations Affect the Industry Chain?

Full Article Highlights: On April 7, A-shares rose strongly before giving back gains. The Shanghai Composite edged up slightly, while the STAR Market 50 jumped more than 1.6% against the trend, with over 3,600 stocks finishing higher. The chemical sector led the rally due to a surge in earnings and expectations of price increases. The STAR Market 50 strengthened independently, driven by a domestic AI logic. In the near term, external risks have not fully dissipated; over the medium to long term, attention centers on a “double main thesis” of “benefiting from high oil prices + earnings certainty.”

In the morning of April 7, A-shares opened higher and then traded down in a volatile pattern. The SSE Index inched up 0.03% to 3,881.17 points; the Shenzhen Component fell 0.20%, the ChiNext fell 0.46%, and the STAR Market 50 jumped 1.63% against the trend. In the first half of the day, total market turnover was 1,077.9 billion yuan, up 1 billion yuan from the previous trading day. However, with more than 3,600 advancing stocks, the money-making effect was not bad.

Stocks across the Asia-Pacific market were mixed that day, with clear divergence. After opening higher, Japan’s Nikkei 225 turned lower intraday and slipped back toward the 53,323.41-point area by the midday break, down about 0.17%. South Korea’s KOSPI opened up more than 2% but saw the gains narrow steadily; it even turned slightly negative around midday and ultimately ended down about 0.27% at 5,435.54 points. India’s Sensex fell more than 1%, closing at 73,489.22 points. Overall, the Asia-Pacific market did not show a one-way upward move, and geopolitical uncertainty continued to weigh on risk appetite.

Regarding the Middle East situation, tensions between the U.S. and Iran remain in a stalemate. Trump pushed the negotiation deadline back to 8:00 p.m. U.S. Eastern Time on April 7 (8:00 a.m. Beijing Time on April 8) and warned that “Iran could be crushed within a single night.” He also proposed that the “tolls” for the Strait of Hormuz should be collected by the United States. Iran, meanwhile, put forward 10 clauses, calling for a permanent ceasefire and a security passage mechanism through the strait, but emphasized it would not reopen the strait on the condition of a “temporary ceasefire.” The hope of the U.S. and Iran reaching a ceasefire agreement is growing increasingly remote; mediators reportedly feel pessimistic about Iran “yielding” before the final deadline. Affected by this, international oil prices have stayed at elevated levels—WTI crude oil futures settled at 112.41 U.S. dollars per barrel, and Brent crude settled at 109.77 U.S. dollars per barrel.

Back on the A-share trading board, index performance diverged clearly. The STAR Market 50 stood out as the sole winner. At the industry level, it was a study in contrasts: basic chemicals led with a 2.63% gain, while agribusiness, oil & petrochemicals, and coal all rose more than 1%. Communication, automobiles, banks, non-bank financials, and power equipment all finished lower across the board.

What’s most worth breaking down today is the collective surge in the chemical sector. In the organosilicon segment, Dongyue Silane Materials hit the 20cm daily limit; its net profit for the first quarter is expected to surge 397% to 451%. This growth rate far exceeded expectations and directly pulled up Silicon Treasure Technology, Xinan Shares, and GCL Senkai Silicon Industry. In the large-scale refining and petrochemicals direction, multiple stocks such as Sanfangxiang and Hengyi Petrochemical hit daily limits. In the glyphosate direction, Jiangtian Chemical jumped more than 10%, while Xinan Shares and China National Chemical? (CNC United) both hit daily limits.

There are three layers of driving logic: first, direct catalysts from earnings exceeding expectations; second, oil prices have risen due to the Middle East situation, and price-increase expectations are transmitted along the industry chain to mid- and downstream chemical products; third, the supply clearance in certain sub-industries—such as aramid fiber—means the logic of a reversal from the bottom of the cycle is being recognized by the market. In addition, the rise in the PCB sector is also an extension of the price-increase logic. On April 3, industry leader Jackting? (Kingboard Laminates?) announced a 10% price increase. The reason cited was that upstream resins and electronic fiberglass cloth saw “price surges and tight supply,” and related A-share stocks responded accordingly.

Next, look at the independent strength of the STAR Market 50. Early on, gains were led by areas such as semiconductor materials, memory, and HBM. Domestic AI represents a relatively independent shift in industry trends, and it has not yet been priced in fully by the market. Profit expectations for hard-tech growth names have continued to improve. Meanwhile, overseas geopolitical conflicts pose limited disruption to this kind of “domestic demand + technological self-reliance” logic, so investors are willing to assign the STAR Market direction a higher valuation premium even in a choppy market.

How should we look at the market in the near term? A-share markets have most likely already found the bottom in the near term, and the next phase is likely to focus on volatile repair. But external risks have not been materially resolved yet. After the U.S. aircraft carrier strike group centered on “USS Bush” completes deployment in mid-April, the likelihood of carrying out ground operations would rise significantly, which could intensify concerns about stagflation driven by further oil-price increases. If U.S. forces launch an offensive at that time, the market may first fall and then rise, playing out a turnaround from adversity. The middle to late part of April is a critical window; before then, volatility is still relatively high, and it’s not advisable to bet heavily.

For medium- to long-term strategy, you can position around the “dual main line” of benefiting from high oil prices + earnings certainty. First, broad energy themes, including coal, oil & gas, coal-to-chemicals, and other directly benefitting items, as well as sectors like photovoltaics and energy storage that have an energy substitution logic. Second, top-quality technology themes—areas such as electronics (semiconductors, AI hardware), communications, and power equipment—where industry trends provide support and the ability to deliver on first-quarter reports is strong.

The current market is in a churning-and-bottoming phase. Turnover has not increased meaningfully. It is expected that more time will be needed to digest sentiment and complete trading rotation. Retail investors can use this window to gradually adjust their portfolio composition, prioritizing directions with reasonable valuations and earnings that are visible, and avoid chasing short-term hot spots.

Note: Markets involve risk; investing requires caution. This article is compiled based on publicly available information and does not constitute any investment advice.

Author’s statement: Personal opinions are provided for reference only.