Shanghai Composite Index Is Not Necessarily A Good Thing.

This week, the Shanghai Composite Index accelerated up 6.27%, up 253 points.

Friday rose 2.2%, the highest 4317 points, closed at 4287 points.

While the Shenzhen composite index only increased by 0.97%, small and medium sized boards and gem fell -0.5% and -4.49%, and the motherboard and the two board index were divided.

The Shanghai Stock Index accelerated upward, mainly due to the rally of heavy weight stocks, such as petrochemicals, banking, brokerage and insurance stocks, which conquered the top of 3404 last December and set a new high, thus contributing to the index.

Admittedly, big blue chips also have reasons for valuing and repairing, but they should not be the only theory of price earnings ratio.

All have to be filled.

We should fully realize that these big blue chips are no longer what they used to be, and lack of growth.

The growth rate of the five largest banks in 2014 is lower than that of GDP, which does not represent the direction of future economic and market development.

If blindly chasing up large cap stocks, it will also repeat the long lost period of buying large cap stocks in December 2012 and December 2014.

At the same time, the rise of large cap stocks not only made the Shanghai stock index go up, but also raised the valuation level of the stock market rapidly, which could easily lead to the suppression of the bad policy, and would consume a lot of capital in the market. It also made the opportunity to sell the lucrative small and medium-sized growth stocks for the organizations to make use of the index's popularity, which provided convenience and aggravated the market turbulence, causing the majority of investors not to make money or even lose money.

At the beginning of this week, at the top of 4100, as a result of the centralized issuance of 30 new shares and the opening of Shanghai 50 and China Securities 500 futures, there was a wide concussion of more than 100 on Wednesday.

Some public opinion said: "in 2007, the 5 / 30 type crash (4335 - 3404 points) will come again at any time, the current round of adjustment will fall to 3000 points.

But this is not the time.

When the 5 / 30 crash in 2007, there were several mid-term summit signs: the economy was overheating.

With a sharp rise in value, monetary policy tightened, management suppressed excessive speculation in the stock market, and bad stocks rose to the top. At 4000, the Shanghai and Shenzhen stock markets were valued at 43 times and 54 times.

And now the 4000 point.

The pressure is heavy, the devaluation of the RMB pressure is very great, the monetary policy is steadily loosening, and the management has spared no effort to support the stock market. Since standing on 3600 points in March 20th, the people's Daily has issued three articles, Xinhua news agency has issued 12 articles, and it has been inflating upward for the stock market. It said, "4000 points are reasonable, there are still some room for improvement". "Seven years and 4000 years away, the valuation is only halfway up the mountain."

More rarely, on Wednesday, the Xinhua News Agency sent "the high level of attention to the capital market and the optimistic expectation of the investors".

From the highest point on Wednesday's Shanghai Composite Index to 4174 points, to Thursday morning's lowest 4031 points, to rebound to 4194 points and even to Friday's closing of 4287 points, the market has such a strong ability to self repair, it is enough to prove that as long as there is no "midnight cock style" policy to suppress, it will not be possible again "5 30" type collapse.