By Zheng Buchun

Yesterday has seen mild market consolidations with Shanghai Composite up 0.14% to 3113.01points. However, Shenzhen main board, small and medium board and growth enterprises market fell 0.45%, 0.25% and 1.28% respectively. In general, blue chips and weighted stocks performed well. Stocks of gold companies also showed slight gains, but small individual stocks, stocks of growth enterprises and newly listed companies were weak.

LeEco, Tuesday's best performer, dropped on Wednesday, which drove down the stocks of growth enterprises and newly listed companies. Official media keeps stating that IPO market in China is far from overheat, which signifies IPO filing will remain robust. In addition, 2017 is a year highlighting SOE and hybrid ownership reform, which may divert some funds to other sectors. Moreover, China has tightened regulations on additional common stocks.

All those factors will put pressure on stock performance of growth enterprise and newly listed companies. Investors should to lower the expected returns from those stocks.

The A-share market fell again on Wednesday but not to a dangerous level. If there is no bad news in the coming days, I think it may have chances to rebound.

(Zheng Buchun is NBD's columnist)

Email: tanyuhan@nbd.com.cn