By Zheng Buchun

A-shares fell broadly from last Wednesday to Friday with Shanghai Composite down 1.31% to 3112.76 points. Shenzhen main board, small and medium board, and growth enterprise market plunged 3.28%, 3.43%, and 4.03% respectively.

The stock market has come under pressure due to rising number of new stocks and liquidity strain. I think the pressure is not going to ease until Spring Festival comes.

History shows that liquidity strain will ease around the Spring Festival. Since companies to lunch IPOs have to prepare fiscal reports of 2016, the number of new stocks will not increase too much shortly after Spring Festival. The central bank has injected more liquidity into the market so far. In addition, banks lend out more in the first month of each year. Therefore, there is no need to worry about liquidity.

After studying some sub-new stocks, I think there is additional 10% to go before they bounce back. Investors should keep eye on those stocks.

(Zheng Buchun is NBD's columnist)

Email: tanyuhan@nbd.com.cn