China's three major stock indices opened modestly lower on September 16, only to stage a strong rebound that turned all benchmarks positive by midday, with the STAR 50 index leading gains and the market displaying a distinct pattern of technology-led growth alongside a robust semiconductor supply chain rally. As of the midday close, the Shanghai Composite Index advanced 0.57% to 3,886.48 points, the Shenzhen Component Index climbed 1.42% to 13,476.85 points, the ChiNext Index jumped 2.35% to 3,324.36 points, and the STAR 50 surged 4.50% to 1,621.75 points. Over 4,200 stocks advanced across the market, with combined turnover on the Shanghai, Shenzhen, and Beijing exchanges reaching 1.1738 trillion yuan for the morning session, up 108.6 billion yuan from the previous trading day. In terms of capital flows, main funds were net buyers in the telecommunications, electronics, and semiconductor sectors during early trade, with the telecom space attracting the largest inflows.

Looking at sector performance, gainers were led by semiconductor materials, lithography machinery, optical fiber-related concepts, and CPO (co-packaged optics) modules, while precious metals and PCB concepts also showed notable strength. On the downside, automobile manufacturing, banking, and insurance sectors declined the most. Overall, capital concentrated its flow toward electronics and technology sectors such as semiconductors and telecommunications, while heavyweight financials, autos, pork-related consumer stocks, and other segments saw modest pullbacks. Market breadth favored advancers, with rising stocks outpacing decliners across the board.

Semiconductor supply chain rallies broadly

The semiconductor materials segment performed strongly today, with Youyan Silicon hitting the 20% limit-up, Zhongjing Technology securing a second consecutive limit-up, and Youyan New Materials and Lu Xiao Technology also locking in limit-up gains. Crystal Growth Semiconductor and Mind Electron both rose 20%, while Shanghai Hejing, Tianyue Advanced, and National Silicon Industry Group led the gains in the sector. On the news front, on September 15, the Ministry of Industry and Information Technology and the National Development and Reform Commission jointly issued the "15th Five-Year Plan for the Development of the Electronic Information Manufacturing Industry," which sets a target for revenue of large-scale enterprises to exceed 30 trillion yuan by 2030. The plan explicitly calls for advancing integrated circuit full-chain development, promoting the high-end evolution of electronic components and materials, and consolidating the foundation of the optoelectronics sector.

Optical fiber concept rebounds from early losses

The optical fiber concept initially opened lower but rebounded strongly through the session, with Accelink Technologies, Huamai Technology, Yongding Shares, and Zhishang Technology all hitting limit-up. Changxin Bochuang, Changguang Huaxin, and JPT Opto-Electronics also posted significant gains. On the news front, Goldman Sachs, after visiting 15 optical communications companies in China, significantly raised its demand forecasts for high-speed optical modules, upgrading its 2027 and 2028 demand projections for 800G and above modules by 39% and 36%, respectively. The bank also expects 1.6T optical module prices to remain supported above $700. Meanwhile, the FCC's final rules did not include optical modules within restricted scope, alleviating previous market concerns about supply chain constraints. Additionally, at the 27th China International Optoelectronic Exposition (CIOE 2026), multiple optical communications manufacturers showcased NPO solutions along with supporting external light source modules.

Precious metals advance steadily

The precious metals sector climbed steadily through the session, with Laison Tongling hitting limit-up, while Sichuan Gold, Zhaojin Gold, and Chifeng Gold led the sector's advance. On the news front, spot gold briefly touched $4,330 per ounce, up approximately 0.8% on the day, while spot silver expanded its intraday gains to more than 1.5%.

PCB concept shows repeated activity

The PCB concept continued to show active trading, with Aohong Electronics securing a fourth consecutive limit-up, Weiergao rising 20% to limit-up, and Aoshikang hitting limit-up as well. Yibo Technology, Jinlu Electronics, and Zhongjing Electronics also followed with gains. On the news front, prices for copper-clad laminates and electronic yarn, key upstream PCB materials, have continued to rise. According to Zhuochuang Information data, 7628 electronic fabric ex-factory prices have climbed to 11.5 to 12.1 yuan per meter, up 10% to 20% month-over-month. China Jushi also raised its September electronic yarn quotations, with thick fabric prices up 15% and thin fabric prices up 20%.