A-Share Margin Balance Falls to ¥2.62 Trillion as Deleveraging Continues
nashnova research
A-share margin financing dropped to ¥2.62 trillion, down 13% from the June peak — leveraged money is still leaving, which means the market lacks the firepower for a strong rebound, especially in AI names.
How far has the margin balance fallen — and what does it signal?
As of September 4, A-share margin financing stood at ¥2.62 trillion (≈$390.1 bn), down roughly 13% from the all-time high of ¥3.01 trillion on June 25.
A brief bounce in August faded quickly; the balance resumed its decline.
This means → Margin financing tracks how much borrowed money is chasing stocks — a proxy for risk appetite. Its sustained contraction signals that leveraged capital has not re-entered, leaving any rally without reliable fuel.
Why is short-selling balance rising at the same time?
Short-selling (securities lending) balance climbed to ¥29.2 billion, near a two-year high.
In plain terms = Margin buying is bullish leverage; securities lending is bearish leverage. One falling while the other rises means bearish positioning is gaining strength.
This reflects a deleveraging cycle where bulls are retreating and bears are actively adding.
How hard has the AI trade been hit?
The STAR 50 Index — the main vehicle for China's AI trade, dominated by chip stocks — is approaching the low set after its July plunge.
The index fell 26% in July alone, its worst single-month drop on record.
This means → The trigger was doubt over whether massive AI capex can convert into revenue. Deleveraging then drained the leveraged money propping up valuations — two forces are compressing the AI trade simultaneously.
Is the external environment helping?
U.S. long-end Treasury yields hit multi-year highs. Fed Chair Kevin Warsh signaled he would consider rate hikes if inflation fails to cool.
Global risk assets are broadly under pressure; A-shares are not alone.
China's key July economic data missed expectations, yet Beijing has not launched large-scale stimulus so far.
In plain terms = Rate-hike expectations overseas compress valuations; the absence of strong stimulus at home removes the safety net. The bull case is thin on both ends.
What to watch next?
Two pivotal markers: when deleveraging bottoms out + whether Beijing delivers substantive policy to restore confidence.
The margin-balance inflection is the first signal — leveraged money flowing back in would indicate risk appetite is healing.
Until then, the A-share AI trade lacks a reliable floor.
市场有风险，内容仅供研究参考，不构成投资建议。