Changpeng Wan
Sudden Afternoon Rally Shakes Markets
The afternoon of July 24, 2025, witnessed extraordinary volatility across Asian exchanges as lithium producers and vaccine developers staged explosive rallies. Stocks like Tianqi Lithium (天齐锂业) and Zhifei Biological saw unprecedented spikes, with several hitting daily price ceilings – a rare market phenomenon showing investor enthusiasm amid regulatory shifts and bullish earnings reversals.
Key Developments
- Tianqi Lithium A-shares surged 10% (SHE: 002466), its first daily limit-up this year
- Lithium carbonate futures jumped 8%, hitting ¥77,240/ton
- Zhifei Biological (智飞生物) soared 20% on vaccine trial progress
- Regulatory overhaul in Yichun sparked lithium supply expectations
The Lithium Supply Shock
Yichun’s new lithium reserve verification mandate ignited trading frenzy. Ordered by the Yichun Municipal Natural Resources Bureau, all local mining firms must submit certified reserve reports by September 30. This aggressive policy aims to stabilize oversupply in a region producing one-third of China’s lithium.
Yichun: Anti-Dumping Breakthrough
Market analysts interpret Yichun’s move as opening salvo against predatory pricing. Lithium carbonate spot prices gained 9% since the announcement as traders anticipated consolidated output. Local mines furnish material for EV batteries powering BYD and CATL supply chains, making this potentially industry-defining regulation.
Tianqi Lithium’s Remarkable Turnaround
Tianqi Lithium CEO Frank Ha (夏浚诚) presided over astonishing financial recovery. After hemorrhaging ¥50B in 2024, the firm projects breakeven or up to ¥155M Q2 profit. Tightened operational costs and rising contract prices catalyzed the revival. Trading volume exceeded ¥4B during Thursday’s surge – highest since mid-2024.
Biotech Breakout Led by Vaccine Innovators
Pharmaceutical stocks dominated afternoon trading. Zhifei Biological’s 20% rally followed Phase I trials in Australia for its proprietary 26-valent pneumonia vaccine.
Zhifei’s Game-Changing Vaccine Pipeline
Beijing-based subsidiary Zhifei Lvzhu Pharmaceuticals developed the pneumococcal candidate targeting elderly populations. As global antibiotic resistance mounts, this vaccine could address critical WHO priority pathogens requiring new solutions.
Sector-Wide Momentum Builds
The surge spilled across healthcare:
- Walvax Biotech (沃森生物): +13%
- Sino Biological (康希诺): +7%
- Wuxi Biologics (药明生物): +11%
Anatomy of Afternoon Anomalies
Midday price eruptions often signal institutional repositioning. Thursday’s volume patterns suggest hedge funds covered short positions simultaneously. Program trading algorithms exacerbated moves once key resistances broke.
Historical Precedents
Similar afternoon surges include:
- August 2023 semiconductor rally after U.S. Chips Act exemptions
- March 2024 rare earth spikes during Greenland mining disputes
Risks and Opportunities
These violent rallies create trading windows but warrant investor caution:
- Policy Dependency: Lithium gains hinge on Yichun enforcement
- Valuation Gaps: Bio-tech P/E ratios approach 52-week highs
- Technical Indicators: RSI readings entered overbought territory
Sector Rotation Considerations
Capital flowing from AI stocks toward commodities signals economic recalibration. Battery metals and pharma increasingly favor recession-resistant characteristics.
Strategic Investment Approaches
Position for volatility while mitigating downside:
- Option Hedging: Pair long positions with protective puts
- Basket Trading: Spread exposure across lithium miners
- Catalyst Calendar: Monitor September 30 Yichun deadline
Navigating High-Velocity Markets
The July 24 anomalies demonstrate policy-driven markets’ explosive potential. While lithium producers and biotechs offer compelling narratives, fundamental analysis remains paramount. Institutional money favors Tianqi Lithium and CICC (中金公司) analysts project further commodity tailwinds. Prioritize stocks demonstrating both technical momentum and valuation support.
Surging afternoon volumes frequently precede sustained trends. Establish price alerts around critical levels: ¥80,000 lithium futures and Zhifei’s ¥65 support demand vigilance. History favors nimble capital deployment during regulatory pivot points like today’s Yichun reform.
