A-shares opened lower but closed higher today, while the Central Bank of Turkey initiated a large-scale gold sell-off.

On March 27, the market rebounded after a weak opening, with all three major indices closing in positive territory. The Shanghai Composite Index rose by 0.63%, the Shenzhen Component Index increased by 1.13%, and the ChiNext Index advanced by 0.71%.

A total of 4,337 stocks gained, with 93 hitting the daily limit-up, while 1,073 stocks declined.

Pharmaceutical stocks surged significantly, with more than ten companies reaching the limit-up. Analysts noted that Hong Kong-listed innovative drug firms have recently released their annual reports, showing strong performance among both pharmaceutical and biotech companies. Since the beginning of 2026, business development activities have accelerated, with deal values surpassing those of the same period last year, highlighting the value created by overseas expansion of innovative drugs.

The innovative drug sector has been adjusting since last September, with significant declines and prolonged consolidation leading to reduced market crowding. Despite the price adjustments, solid industrial progress has been made, building momentum for a potential rebound. Analysts added that the sector has recently shown a volatile upward trend, supported by stabilizing liquidity conditions and strengthening competitiveness of domestic innovative drugs through business development deals and key project data.

The lithium battery sector experienced a collective surge, with Rongjie Co., Ltd. hitting four consecutive limit-ups, while Jiangte Electric, Shengtai Lithium, and Yongxing Materials also rose by the daily limit. The rally was driven by lithium carbonate futures breaking through 160,000 yuan per ton, approaching 170,000 yuan. Analysts pointed to rising global energy costs and expectations of accelerated energy self-sufficiency trends, which may elevate long-term demand growth for new energy lithium batteries.

Chemical stocks remained active, with companies such as Lubei Chemical, Shandong Haihua, and Chitianhua hitting limit-ups.

On the downside, the coal sector underwent adjustments, with Liaoning Energy falling by the daily limit.

In response to the Iran conflict, Turkey reduced its gold holdings by $8 billion. Within two weeks of the outbreak of hostilities, the Turkish central bank sold and utilized approximately 60 tons of gold through swap operations, valued at over $8 billion.

According to the latest data from the Turkish central bank, gold reserves decreased by 6 tons in the week of March 13 and by another 52.4 tons in the week of March 20, indicating a rapid decline. Part of the reduction came from direct sales, but the majority was executed through gold swaps to obtain foreign exchange or lira liquidity.

This move occurred as Turkey's anti-inflation strategy faced pressure. The strategy relies heavily on maintaining lira stability or allowing gradual depreciation, often through hard currency interventions by state-owned banks. However, rising energy import costs and a surge in dollar demand since the conflict began have made this approach more difficult to sustain.

Iris Cibre, founder of Istanbul-based Phoenix Consultancy, stated that officials have utilized up to $135 billion of the central bank's gold reserves through sales and swaps to meet liquidity needs and stabilize domestic markets. She estimated total sales at around 58.4 tons, with more than half conducted via overseas gold-for-currency swaps.

Previous reports indicated that the Turkish central bank was considering using gold reserves through London market transactions to cushion the lira's depreciation pressure caused by the conflict.

Over the past decade, Turkey has been one of the world's most aggressive gold buyers. The recent sell-off marks a reversal in policy direction, aimed at reducing reliance on dollar-denominated assets. Gold prices have fallen approximately 15% this month as investors took profits following significant gains since last year.

Daniel Ghali, a commodity strategist at TD Securities, suggested that the economic impact of the Iran conflict may weaken gold demand from some central banks while forcing others to utilize gold reserves to meet dollar-denominated obligations.