Recently, the domestic coal price in China has been soaring, which in turn has pushed the share price of coal mining enterprises to soar. At the same time, however, the Shanghai Composite Index appears sluggish, even falling to varying degrees. Why is there a situation of coal rising and Shanghai Stock Exchange falling?

The reason for the soaring coal price

First of all, we need to discuss the reasons for the skyrocketing coal prices. Recently, tight supply, strong demand and reduced imports in many parts of China have led to a "crazy rise" in coal prices. Among them, the impact of the COVID-19 epidemic on the supply chain is one of the key factors leading to the soaring coal price. The shutdown and maintenance of national key coal mines, coupled with strict port control, have had a great impact on the coal supply chain. This has prompted domestic coal prices to continue to climb.

At the same time, the support of China's energy policy for domestic coal demand is also one of the factors leading to the soaring coal price. China has increased the use of fossil fuels in many places, increasing the demand for coal. However, after the epidemic, the infrastructure and comprehensive second child policy vigorously promoted by the government need a lot of energy, including coal. These demands lead to rising coal prices, which in turn pushes up coal stock prices.

Reasons for the soaring share price of coal

Undoubtedly, the increase in coal prices directly led to the profits of some domestic coal mining enterprises. This is also an important factor in the performance of coal stock price. In addition, the "pressure-bearing" stocks in domestic and foreign loans, agricultural and rural collective meetings and fund redistribution have picked up recently, and coal stocks have also been dyed. This has led to coal stocks' particularly eye-catching performance in the stock market.

However, the Shanghai Composite Index cannot follow the performance of coal stocks. The reason for this is the following：

The pressure of environmental protection in the coal industry has increased.

In recent years, the world has paid more and more attention to environmental protection, and China is no exception. With the coal industry's emphasis on environmental protection, all localities are gradually promoting the clean and low-carbon transformation of the coal industry, and the environmental pressure faced by the coal industry is increasing. This leads to the limited profitability of some large coal enterprises, which indirectly weakens the return rate of stocks.

Lack of market awareness

On the other hand, the value logic behind the coal stock price rise has not been fully recognized by the market. In recent years, the global economic situation is uncertain, investors' risk appetite has been restrained, and everyone is generally cautious. The phenomenon of excessive increase in coal stocks is also easy to curb investors' investment enthusiasm. Investors' awareness of coal stocks is not high enough, which also makes the market's recognition of its investment value not high enough.

abstract

The soaring coal price has promoted the rise of the coal stock market to a certain extent, but at the same time, the Shanghai Composite Index has not followed suit. The reasons are the environmental pressure faced by the coal industry, investors' risk preference and the market awareness of coal stocks. In the future, with the increasing advocacy of environmental protection and clean energy, the investment value of coal industry and its related stocks may need to face more tests and turning points in the future. Investors need to assess the situation and accurately judge the fluctuation trend of the coal industry in order to maximize the return on investment.