by JIANG Yiman

China's A-share market, which covers mainland-listed stocks in Shanghai and Shenzhen, crossed the 400 trillion yuan mark in annual trading value for the first time, reflecting a sharp pickup in liquidity and investor activity, according to data provider Wind.

Total turnover reached 405.87 trillion yuan as of Dec. 22, according to Wind. The market's average annual turnover rate rose to about 1.74% and was on track for its highest level since 2016, signaling more frequent trading and a return of short-term activity after years of subdued volumes.

Trading was increasingly concentrated in a narrow group of large, liquid stocks. Nineteen shares each posted annual trading value above 1 trillion yuan, highlighting a widening gap between market leaders and the broader universe.

The most actively traded names included Zhongji Innolight, East Money Information and Eoptolink Technology, each with turnover exceeding 2 trillion yuan. The stocks are exposed to technology, financial information services and telecom equipment, sectors that have drawn sustained inflows as investors position for growth tied to China's digital economy.

They were followed by Cambricon Technologies, CATL and Victory Giant Technology, all recording more than 1.8 trillion yuan in trading value. Most operate in areas such as artificial intelligence, electric vehicles and semiconductors, industries Beijing has prioritized as part of its long-term industrial upgrade.

Brokerages are broadly optimistic about the outlook for 2026. Analysts at Changjiang Securities estimate that incremental funds flowing into the A-share market next year could total 6 trillion to 9.6 trillion yuan, citing improving liquidity conditions and policy support. Shenwan Hongyuan Securities said it expects a seasonal rally early next year, pointing to increased allocations by insurers and steady inflows into mainland equity ETFs.

Since December, net inflows into such ETFs have exceeded 40 billion yuan, Shenwan Hongyuan said, signaling continued accumulation by institutional investors.

Several brokerages said gains in the A-share market are likely to remain gradual rather than explosive, with stock performance increasingly driven by earnings growth rather than valuation expansion alone, as policy support feeds through to corporate fundamentals.