Shanghai A shares are showing fresh signs of strength after a period of consolidation, with the proprietary buying power index from Lowry Research signalling that a recent market uptick has solid underpinnings. That has happened at the same time as selling pressure, which had been rising, has eased a little. The issue is how to play a market where more than 90 per cent of the stocks in it are trading above their 10-day moving averages. "Chasing stocks at this point should probably be avoided," Lowry analysts say in a new note to clients, though they add that recent price action suggests pullbacks have proven to be entry points on another ride higher. Lowry sees the most positive momentum in technology, health-care, telecommunications, consumer goods and industrial stocks. Financials have the weakest momentum.
