On June 23rd, the three major A-share indices opened collectively lower. As of the time of writing, the Shanghai Composite Index was down 0.12%, the Shenzhen Component Index had fallen 1.16%, and the ChiNext Index declined 1.49%.
Key Market Movers
The large financial sector continued its strength from the previous session, with Changjiang Securities securing its second consecutive limit-up, while Yinzhijie, Liandi Information, and Huijin Technology surged over 10%. CITIC Securities, GF Securities, and DZH Limited were also among the notable gainers.
The liquid cooling server concept was active at the open, with Envicool and Dayuan Pumps Industry both hitting the daily limit-up. Long Co., Ltd., Qiangrui Technology, Chuanhuan Technology, Chunzhong Technology, Jialitu, and Xinpeng Shares opened higher.
The innovative drug concept experienced volatile gains, with Xinhua Pharmaceutical rocketing to a limit-up, Hainan Haiyao touching the limit-up, and Haixin Co., Ltd., Guangdong Wannianqing, Kangzhi Pharmaceutical, Panlong Pharmaceutical, and Bioray Pharmaceutical following suit.
Market Outlook
Looking ahead, Caixin Securities noted that the significant increase in trading volume and rising prices observed in the previous session, where the three major indices closed with substantial gains, reflects that the market still possesses upward momentum in the short term. Furthermore, the strength shown by some cyclical sectors has effectively taken over from the hard tech theme, potentially setting the stage for a healthy rotation between technology and cyclical sectors going forward. However, whether this constitutes a full-fledged style shift will require more time to observe.
Spotlight on Hot Sectors
Innovative Drug Concept Sees Volatile Gains
The innovative drug concept saw volatile gains, with Xinhua Pharmaceutical rocketing to a limit-up, Hainan Haiyao touching the limit-up, and Haixin Co., Ltd., Guangdong Wannianqing, Kangzhi Pharmaceutical, Panlong Pharmaceutical, and Bioray Pharmaceutical following suit.
Catalyst: Recently, Xinhua Pharmaceutical, a subsidiary of Hualu Group, received a "Drug Clinical Trial Approval Notice" from the National Medical Products Administration for its self-developed novel drug candidate LXH-2103 injection. This marks another critical step for the company in the field of original innovative drug R&D and its strategic layout in the narcotic and psychotropic drugs sector.
Large Financial Sector Continues Strength
The large financial sector continued its strength from the previous session, with Changjiang Securities securing its second consecutive limit-up, while Yinzhijie, Liandi Information, and Huijin Technology surged over 10%. CITIC Securities, GF Securities, and DZH Limited were also among the notable gainers.
Catalyst: The Lujiazui Forum held last week released multiple policy signals, including further enriching investment products and tools, guiding pension and insurance funds to increase equity investments, supporting listed companies in mergers, acquisitions, and refinancing, and deepening reforms of the STAR Market and ChiNext.
Liquid Cooling Server Concept Active at Open
The liquid cooling server concept was active at the open, with Envicool and Dayuan Pumps Industry both hitting the daily limit-up. Long Co., Ltd., Qiangrui Technology, Chuanhuan Technology, Chunzhong Technology, Jialitu, and Xinpeng Shares opened higher.
Catalyst: NVIDIA's official blog published an article detailing the comprehensive 45C liquid cooling technology used in its latest AI servers. NVIDIA indicated that as its Rubin platform adopts full liquid cooling, all cloud service providers and data center operators building systems for this platform are driving the related transformation.
Institutional Perspectives
Caixin Securities: Rising Volume and Prices Indicate Short-Term Upside Momentum
Caixin Securities believes the simultaneous increase in volume and prices, with the three major indices closing significantly higher on substantial volume yesterday, reflects that the market still possesses upward momentum in the short term. Additionally, the strength shown by some cyclical sectors has effectively taken over from the hard tech theme, potentially setting the stage for a healthy rotation between technology and cyclical sectors going forward. However, whether this constitutes a full-fledged style shift will require more time to observe. In the near term, it is crucial to grasp the rhythm of style rotation. Although the market is currently in a process of style rebalancing, from a medium-term perspective, the high-growth trend of the AI industry continues. As overseas tech giants' half-year reports are successively disclosed from mid-July to the end of August, the pricing logic for the AI tech direction is expected to revert to being driven by fundamentals and earnings.
Huaxi Securities: Dual Innovation Boards' Volume Breakout to New Highs Officially Establishes New Uptrend
Huaxi Securities opines that the A-share market launched a volume-driven attack on the first trading day of the week, with the average daily turnover of the entire A-share market returning above 3 trillion yuan, and the structural divergence between tech and non-tech sectors playing out to an extreme. Tech growth and the Dual Innovation Board directions led the gains, with the STAR 50 and ChiNext Index posting medium-to-large positive weekly candles, establishing a new uptrend. Externally, the easing of tensions between the US and Iran, coupled with the conclusion of interest rate meetings by the US, Japanese, and European central banks, has marginally improved factors that were suppressing risk appetite. Subsequent trading based on rate hike expectations is expected to cool as oil prices retreat. Internally, resonating with the global AI tech rally, the Dual Innovation Board indices broke out to new highs on heavy volume, officially establishing a new upward trend. First, the simultaneous expansion of trading volume and margin financing shows the positive feedback effect of incremental capital entering the market. Second, the accelerated differentiation between old and new economic drivers is directing capital to continue focusing on high-growth areas like AI and semiconductors. Third, the Lujiazui Forum emphasized a "supporting excellence, supporting science" orientation, strengthening the tilt of financial resources towards "hard tech" fields, further solidifying the logic of the main market theme.
Tianfu Securities: Market Internally Recognizes High Crowding in Tech Direction
Tianfu Securities believes that as June draws to a close and half-year earnings forecasts are about to be released, market funds, for safety considerations, will gradually increase the weighting of earnings fundamentals in pricing. Looking at the logic behind the rise in non-ferrous metals, it is essentially driven by resource demand related to AI. The current market logic has shifted from hardware itself to infrastructure and then to resource raw materials for speculation, which is essentially a diffusion along the industry chain. The rise in both volume and price for the indices and major sectors confirms the quality of the gains, laying the foundation for subsequent market movements. The internal differentiation within the tech sector, the accelerated pace of rotation, and the diffusion of speculative logic all indicate that the market itself has recognized the high crowding in the tech direction. Going forward, attention should be paid to changes in trading volume and the sustainability of sectors participating in the rotation.