By Zheng Buchun

Shanghai Composite was up 0.21% to 3165.42 and Shenzhen Composite down 0.16% to 2005.58 points. Concept stocks, represented by China Telecom performed well yesterday.

Offshore RMB continues to gain strength recently, which closed at 6.9605 on Wednesday and 6.9806 on Thursday. In theory, RMB appreciation is good for the A-share market, but is at the cost of short-term liquidity. From this week on, central bank will keep money supply tight through reverse repos. Although short-term capital cost will drop significantly, it keeps going up in the medium and long term.

US nonfarm payroll of December and China's foreign reserves of 2016 are two more things to watch out recently. In addition, more detailed policies will be introduced as Donald Trump takes office around January 20. RMB exchange rate is bound to be affected, but currently it is hard to tell how.

A-shares are likely to consolidate at later time of this week. During the consolidation, the raising or falling trend will be hard to sustain in general.

(Zheng Buchun is NBD's columnist)