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Key factors influencing the stock market positively and negatively.

Macro News The 19th meeting of the Standing Committee of the 14th National People's Congress (NPC) voted on the morning of December 27 to pass a decision on convening the fourth session of the 14th NPC. According to the decision, the fourth session of the 14th NPC will be held in Beijing on March 5, 2026. The 45th Chairperson's Council meeting of the 14th National Committee of the Chinese People's Political Consultative Conference (CPPCC) recently reviewed and passed a decision (draft) on convening the fourth session of the 14th CPPCC National Committee, proposing that the session be held in Beijing on March 4, 2026. The National Fiscal Work Conference was held in Beijing from December 27 to 28. The meeting indicated that a more proactive fiscal policy will continue to be implemented in 2026. Minister of Finance Lan Fo'an stated that fiscal measures next year will vigorously stimulate consumption, including deepening actions to boost consumption, continuing to allocate funds to support the replacement of old consumer goods, and adjusting and optimizing subsidy scopes and standards. The People's Bank of China released the "China Financial Stability Report (2025)". The report proposes that the financial system will implement more proactive and effective macro policies to prevent and resolve risks in key areas. It also suggests efforts to improve the institutional and policy environment conducive to "long-term money making long-term investments," significantly increasing the actual scale and proportion of various medium to long-term funds invested in A-shares. The National Bureau of Statistics released data showing that from January to November, the total profits of industrial enterprises above the designated size nationwide reached 6,626.86 billion yuan, a year-on-year increase of 0.1%. Among these, state-controlled enterprises achieved a total profit of 2,008.36 billion yuan, a decrease of 1.6% year-on-year; share-holding enterprises achieved a total profit of 4,956.56 billion yuan, a decrease of 0.4%; enterprises with investment from foreign, Hong Kong, Macao, and Taiwan sources achieved a total profit of 1,635.53 billion yuan, an increase of 2.4%; private enterprises achieved a total profit of 1,931.99 billion yuan, a decrease of 0.1%.

Industry News The Standing Committee of the National People's Congress passed the newly revised Foreign Trade Law on December 27, which will take effect on March 1, 2026. To further optimize the environment for foreign trade development, the law clarifies that the state will strengthen intellectual property protection related to foreign trade, enhance the intellectual property compliance levels and risk response capabilities of foreign trade operators; it also establishes a trade adjustment assistance system to stabilize industrial and supply chains. The inaugural meeting of the Humanoid Robotics and Embodied Intelligence Standardization Technical Committee of the Ministry of Industry and Information Technology was held in Beijing on the 26th. This committee is primarily responsible for the formulation and revision of industry standards in areas such as basic commonalities, key technologies, components, complete machines and systems, applications, and safety for humanoid robotics and embodied intelligence. The secretariat is located at the China Electronics Society. The Cyberspace Administration of China has drafted the "Interim Measures for the Management of Artificial Intelligence Personified Interaction Services (Draft for Comment)". The draft proposes that providing and using personified interaction services must comply with laws and administrative regulations, respect social morality and ethical standards, and must not engage in activities that induce users to make unreasonable decisions through algorithmic manipulation, information misdirection, setting emotional traps, etc. On December 26, the Shanghai Stock Exchange (SSE) issued detailed rules for commercial rocket companies applying the fifth set of listing standards on the STAR Market. These rules specify that commercial rocket companies must be top-ranked, occupy an important position in the industrial chain, receive high recognition from relevant market entities, and consider investment from seasoned professional institutional investors as an important factor. The National Data Administration issued implementation opinions on strengthening data technology innovation. The opinions mention strengthening breakthroughs in key data technologies; guiding financial institutions to support data technology innovation, and directing more long-term capital, patient capital, and high-quality capital towards the data technology field. The SSE introduced a series of fee reduction and benefit measures for 2026, including exempting listing fees for SSE-listed companies, reducing trading unit usage fees, and exempting handling fees for bond trades excluding convertible bonds. Simultaneously, subsidiaries of the SSE will reduce or exempt fees for trading gateway speed, SSE e-Service, SSE e-Voting, SSE Cloud, etc. The estimated total fee reductions and benefits for 2026 are approximately 1.113 billion yuan. Chinese ETFs have officially entered the 6 trillion yuan era. The latest data shows that the scale of Chinese ETFs reached 6.03 trillion yuan, an increase of over 60% from the 3.73 trillion yuan at the beginning of the year. The State Administration for Market Regulation recently conducted compliance guidance on price competition order in the photovoltaic industry in Hefei, Anhui. The administration will intensify quality supervision of products, strengthen price and anti-unfair competition law enforcement, severely crack down on illegal activities, effectively maintain fair market competition order, and promote the standardized, healthy, and sustainable development of the photovoltaic industry. Recently, several lithium iron phosphate (LFP) manufacturers, including Hunan Yuneng, Wanrun New Energy, Dynanonic, and Anda Technology, announced production halts for maintenance. Among them, Wanrun New Energy responded that it is currently conducting maintenance on some production lines, which does not affect the normal progress of overall orders and shipments. Production cuts by leading companies are attributed to equipment maintenance, rising costs of upstream raw materials like lithium carbonate, and downstream resistance to cost transmission, creating multiple pressures. An official from a relevant industry association analyzed that "production halts for maintenance are also a last resort for manufacturers." China's first batch of vehicles with official L3-level autonomous driving dedicated license plates recently began large-scale road operations in Chongqing. This batch consists of 46 Changan Deepal vehicles equipped with L3-level autonomous driving systems. It has been learned from relevant sources that policies related to the recycling and comprehensive utilization of waste power batteries are expected to be introduced soon. China National Petroleum Corporation (CNPC) announced on December 29 that as of December 28, the Xinjiang Oilfield had injected over 1 million tons of carbon dioxide this year, becoming China's first oilfield to achieve an annual injection volume of one million tons of carbon. This marks a key step in the large-scale application of CCUS (Carbon Capture, Utilization, and Storage) technology by Xinjiang Oilfield, providing important technical support and a practical pathway for China's oil and gas extraction to achieve carbon peak and neutrality goals.

Company News ZhenRui Technology announced that the company is under investigation by the China Securities Regulatory Commission (CSRC) for suspected violations of information disclosure regulations. Aluminum Corporation of China Limited (Chalco) announced that it has signed a project contract worth approximately 14 billion yuan with an overseas client. Aerospace Development announced that its subsidiary is primarily engaged in commercial low-orbit satellite operation and data application services, and its revenue for the first three quarters accounted for less than 1% of the company's total revenue. Xiangyang Bearings announced changes in the equity structure of its controlling shareholder, with the actual controller reverting to the State-owned Assets Supervision and Administration Commission of Hubei Province. Shandong Hi-Speed Company announced that its subsidiary has won bids for various sections of the Yiyuan-Zoucheng Expressway construction project, with a total bid price of approximately 9.402 billion yuan. *ST Xinyuan announced that the company has received a donation of 330 million yuan in cash assets. Haozhi Machinery announced that, as of the end of the third quarter, its combined business in robotics and commercial aerospace accounted for about 1% of its main business revenue. Jiufeng Energy announced that the liquid hydrogen product used for the launch of the Long March 8A carrier rocket was exclusively supplied by the company. Strong Circuit announced plans to issue convertible bonds not exceeding 550 million yuan to invest in a project with an annual production capacity of 960,000 square meters of multi-layer boards and HDI boards. Shengyuan Environmental Protection announced that the cumulative net value growth rate of a fund product subscribed to by its subsidiary is -81.54%. The company has reported the matter to public security authorities and filed a report with the CSRC. China Tourism Group Duty Free announced that its wholly-owned subsidiary has won the bid for Lot 01 of the Beijing Capital International Airport duty-free project, with a guaranteed operating fee of 480 million yuan for the first year. Hainan Huatie announced that it has been fined 80 million yuan by the CSRC due to incomplete disclosure and untimely progress updates regarding a 3.69 billion yuan computing power service agreement announcement. Sunwoda announced that its subsidiary is involved in litigation with a claimed amount of 2.314 billion yuan, as WeRide Electric Vehicle Technology (Ningbo) Co., Ltd. alleges quality issues with battery cells delivered between June 2021 and December 2023. VeriSilicon Microelectronics announced that its second-largest shareholder, the "Big Fund" (National Integrated Circuit Industry Investment Fund), plans to reduce its shareholding by no more than 1.7%. In a separate announcement, the company reported new orders worth 2.494 billion yuan signed between October 1 and December 25, with AI computing power-related orders accounting for over 84% in the fourth quarter. Xiaomi Corporation announced that co-founder Lin Bin plans to sell no more than $500 million worth of the company's Class B ordinary shares every 12 months. Fenglong Shares announced that following the change in control, the company will still focus on its original business, and there are no plans or arrangements for a backdoor listing of Ubtech through the listed company.

Global Markets The three major US stock indices closed slightly lower last Friday. The Nasdaq fell 0.09%, but gained 1.22% for the week; the Dow Jones fell 0.04%, gaining 1.2% weekly; the S&P 500 fell 0.03%, gaining 1.4% weekly. Major tech stocks were mixed: Tesla fell over 2%, Google and Apple saw slight declines; Nvidia rose over 1%. The Nasdaq Golden Dragon China Index closed up 0.72% on Friday, accumulating a 0.64% gain for the week. XPeng Motors rose over 6%, NIO rose nearly 4%, while Alibaba and Baidu rose over 1%. International crude oil futures settlement prices fell over 2.5% last Friday. The WTI February contract fell 2.76%, and the Brent February contract fell 2.57%. International gold and silver continued to hit new highs last week. COMEX gold futures rose 1.31% to $4,562 per ounce, gaining 3.98% for the week; spot gold rose 1.12% to $4,531.1 per ounce, gaining 4.44% weekly. COMEX silver futures surged 11.15% to $79.68 per ounce, skyrocketing 18.06% for the week; spot silver jumped 10.24% to $79.196 per ounce, soaring 17.87% weekly. On the local time of December 28, US President Trump, after meeting Ukrainian President Zelenskyy at Mar-a-Lago in Florida, stated that the US had communicated with leaders from the UK, Germany, NATO, and the EU following the talks, describing the exchanges as "very smooth." Trump claimed that significant progress had been made on ending the Russia-Ukraine conflict, covering "close to 95% of the key issues," and described the current progress as reaching a stage "very close to an agreement." Additionally, Trump stated that he does not rule out a trilateral meeting involving himself, Russian President Putin, and Ukrainian President Zelenskyy at an appropriate time, and mentioned having a long call with Putin that day, discussing multiple substantive issues. On the local time of December 28, the Israel Defense Forces confirmed in a statement that last week, its delegation, along with military representatives from Greece and Cyprus, signed the 2026 trilateral military cooperation work plan in Cyprus, as well as bilateral military cooperation plans between Israel and Greece, and Israel and Cyprus.

Investment Opportunity References South Korea's leading electrolyte manufacturer, Enchem, secured a major order exceeding 7 billion yuan from CATL. Enchem announced that its board approved the signing of a long-term supply contract with the world's largest battery maker, CATL, on December 23. According to the contract, Enchem will supply a total of 350,000 tons of electrolyte to CATL from 2026 to 2030, with an estimated total contract value of up to 1.5 trillion Korean won (approximately 7.23 billion yuan). This cooperation primarily targets the Chinese market, with an annual supply of 70,000 tons. This figure not only far exceeds Enchem's total shipments of about 50,000 tons last year but also sets a record for the company's largest single-customer order size since its establishment. The contract amount is equivalent to more than four times Enchem's consolidated sales last year. Previously, due to oversupply, the lithium battery industry chain experienced a price roller coaster, with midstream and upstream companies generally reporting losses from 2024 to June 2025. However, since the second half of this year, with the rapid growth in demand for power batteries and energy storage, capacity utilization rates in some segments have quickly increased, leading to阶段性 tightness in some materials and significant price rebounds. Everbright Securities analyst Zhao Naidi pointed out that structural supply shortages are appearing in various battery materials, potentially ushering in a new round of price increases, and related companies' profits are expected to see significant improvement. The energy storage industry is opening a new growth cycle as a strategic infrastructure enabling rapid data center deployment. Institutions point out that AI computing power equates to electricity consumption, making energy storage a crucial auxiliary. Data centers face severe grid connection bottlenecks, making "power access speed" the top priority. Energy storage is evolving from mere "backup power" to "active power supply," solving voltage fluctuations through peak shaving, valley filling, and grid-forming technologies, becoming strategic infrastructure for the rapid deployment of AI data centers. The construction boom in AI computing centers is reshaping the energy storage industry landscape. At the 2025 4th Gaogong Energy Storage Annual Conference, Gaogong Industrial Institute (GGII) released the "2025 Blue Book on the Development of China's AIDC Energy Storage Industry." GGII analysis indicates that the global AIDC (Artificial Intelligence Data Center) energy storage market is experiencing explosive growth, with shipments of AIDC energy storage lithium batteries expected to exceed 300GWh by 2030, a 20-fold increase from 15GWh in 2025. Sinolink Securities notes that the global energy storage industry is entering a new growth cycle, driven by a triple engine: "AI computing power infrastructure + energy transition necessity + grid congestion," instead of the previous single driver of new energy consumption. Industry supply-demand dynamics have significantly improved, shifting from an inventory reduction cycle to a replenishment and prosperity period, with some segments of the industrial chain expected to experience both volume and price increases.

Trading Halts and Resumptions

[Trading Halt] 600721 Baihua Pharmaceutical 002713 *ST Dongyi 002822 *ST Zhongzhuang

[Trading Resumption] 603608 Tianchuang Fashion 300585 Aolian Electronics 301025 Dook Media 300125 *ST Lingda 000615 *ST Meigu 000430 *ST Zhanggu

Announcements Summary

[Major Events] Aerospace Development: Subsidiary Aerospace Tianmu (Chongqing) Satellite Technology Co., Ltd.'s revenue for the first three quarters accounted for less than 1% of the company's total revenue. Aerospace Development issued an abnormal trading fluctuation announcement, noting its stock price had cumulative deviations exceeding 20% over three consecutive trading days. The company focuses on aerospace defense information technology, developing businesses like blue force systems/equipment and new-generation communication/command equipment. For the first three quarters of 2025, revenue was 1.697 billion yuan, with the increase mainly due to ship deliveries. Its subsidiary, engaged in commercial low-orbit satellite ops and data apps, contributed less than 1% to total revenue. Shengtong Energy (11 consecutive limit-ups): Should the stock price rise further, the company may apply for a trading halt verification. Shengtong Energy issued a volatility announcement stating that if the stock price continues to rise, it may apply to the Shenzhen Stock Exchange for a trading halt verification. Investors are warned of significant risks and advised to invest rationally. Jiamei Packaging (8 consecutive limit-ups): May apply for a trading halt verification if abnormal price increases continue. Jiamei Packaging announced severe abnormal fluctuations in its stock and convertible bonds, noting the recent price severely deviates from fundamentals. It warned of high risks and the possibility of applying for a trading halt verification if prices rise further abnormally, advising rational investment. Fenglong Shares: Ubtech currently has no clear plan to change or majorly adjust the company's main business within the next 12 months. Fenglong Shares announced its stock price had cumulative deviations exceeding 20% over two trading days. It stated that Ubtech has no definite plans to alter the main business, make major asset/business adjustments, or pursue major restructuring involving the listed company within the next 12 months. There are also no plans for a backdoor listing via the company in the next 36 months or asset restructuring plans in the next 12 months. ST Huludao: The company and its chairman, Liu Jingping, are under investigation by the CSRC for suspected information disclosure violations. ST Huludao announced that both the company and Chairman Liu Jingping received立案告知书 from the CSRC on December 26. Operations remain normal, and the company will cooperate with the investigation. Egina Photovoltaics: Received a hearing notice as the Quanjiao County PV project cannot proceed on schedule. Egina announced its previously planned investment in Quanjiao County, Anhui, for a 10GW PV cell, 10GW slice, and 10GW module project is stalled. Due to industry-wide structural capacity mismatches and weak demand leading to low capacity utilization, only Phase 1 (7.5GW cells) was completed; slice and module phases were not built. Production at the Chuzhou base halted starting October 2024. The Quanjiao County Economic Development Zone Management Committee alleges failure to fulfill agreements, issued a hearing notice proposing termination, reclaiming 140 million yuan in capital contribution, ceasing future funding, and seeking compensation for construction costs, rent, etc. The hearing outcome and financial impact are uncertain. Tongyu Communication: The stock price has risen significantly in the short term, posing risks of market overheating and irrational speculation. Tongyu Communication issued an abnormal fluctuation announcement for two consecutive days of price deviations exceeding 20%, warning investors of secondary market risks. Junda Shares: Cooperation matters with Shangyi Photovoltaics will not significantly impact current operating performance. Junda Shares announced a 20% price deviation over three days. The strategic cooperation framework agreement with Shangyi Photovoltaics is non-binding, with specific R&D, investment, and cooperation details yet finalized. Uncertainties exist, and the agreement will not materially affect current performance; long-term impact remains uncertain. Hengrui Pharmaceuticals: Signed an exclusive licensing agreement with Hansoh Pharmaceutical. Hengrui announced licensing its SHR6508 project to Hansoh Pharma, receiving a 30 million yuan upfront payment, potential regulatory and医保-related milestone payments up to 190 million yuan, and tiered sales royalties up to 9%. Additionally, its subsidiary Chengdu Shengdi signed a commercialization services agreement with Hansoh's subsidiary for its paricalcitol soft胶囊 product. Tongye Technology: Plans to acquire 91.69% of Silingke for 561 million yuan. Tongye Technology announced a cash acquisition of a 91.69% stake in Beijing Silingke Semiconductor Technology Co., Ltd. from 22 parties for 561 million yuan. Concurrently, major shareholders plan to transfer a 6% stake in Tongye to an entity controlled by Silingke's actual controller at 21.67 yuan per share. Silingke focuses on R&D and sales of power IoT communication chips, including HPLC and HDC communication chips/modules for smart grids. ST Lutong: Plans to apply to the Shenzhen Stock Exchange for revocation of the Other Risk Warning. ST Lutong announced that shareholder Wu Shichun (holding 10.46%) pledged to use personal funds to fully repay the capital occupation principal and interest by the actual controller and related parties. On December 27, the company received 102.254 million yuan from Wu. After obtaining a special audit report from accountants, the company will apply for ST revocation.

[Major Contracts] Wangfujing Group: Won the bid for Lot 02 of the Beijing Capital International Airport duty-free project. Wangfujing announced receiving a中标通知书 on December 26, confirming it as the winner for Lot 02. The first-year guaranteed operating fee is 113 million yuan, with a 5% sales royalty. The term runs from the contract start date until February 10, 2034 (not exceeding 8 years). Successful implementation would mark the company's first presence in a domestic super-large international hub airport, boosting the scale and market share of its duty-free business.