Amid geopolitical uncertainties with oil prices surging and gold declining, Asian stock markets continued their upward trajectory, bolstered by the AI sector rally. Notably, South Korean stocks rose over 4%, with Samsung Electronics climbing more than 5% to a new record high, while Japan's Nikkei 225 gained nearly 1%. On May 11, China's three major A-share indices opened higher collectively. The Shanghai Composite Index opened up 0.51% at 4201.35 points, marking its highest level in over a decade, with the ChiNext Index and the Shenzhen Component Index both rising over 1% at one point. As of 9:40 AM, the Shanghai Composite was up 0.18%, the Shenzhen Component gained 0.56%, and the ChiNext Index advanced 0.61%.
In terms of sector performance, the memory chip segment led gains at the open. Hongban Technology hit its third consecutive daily limit-up, while Xingfu Electronics, Tongyou Technology, and Jiangbolong surged over 10%. Cultivated diamond concept stocks were active early, with Huanghe Whirlwind opening at the daily limit-up. The commercial aerospace theme extended its strength from last week, with Diankelantian soaring over 10% to set another new post-IPO high, following Jiunda Shares' two consecutive limit-up sessions previously. The green power concept saw repeated activity, with Datang Power Generation hitting its fourth straight limit-up. The glass fiber concept also strengthened repeatedly, with Shandong Glass Fiber achieving five limit-ups in eight sessions and Zhuolang Intelligence recording four limit-ups in nine days.
Looking ahead, China Galaxy Securities noted that as the Shanghai Composite approaches the 4200-point level, the market may face a period of consolidation and increased differentiation in the short term. The overall upward trend remains intact, with sector rotation and structural opportunities likely to dominate. The firm continues to emphasize focusing on main thematic opportunities and seizing structural allocation directions.
**Hot Sectors**
1. **Memory Chip Concept Opens Broadly Higher** The memory chip concept opened significantly higher, with Jiangbolong and Tongyou Technology rising over 10%, while Puran Shares, Baiwei Storage, Langke Technology, and Dapu Micro gained more than 5%. *Commentary: On Monday morning, SK Hynix's stock price rose over 8% at one point, and Samsung Electronics' shares increased more than 5%, both reaching new all-time highs. According to media reports citing informed sources, global tech giants are competing to extend "olive branches" to South Korean memory leader SK Hynix, proposing investments for new production facilities and funding for expensive equipment procurement, aiming to secure memory chip supply ahead of competitors. This phenomenon is unprecedented in the global memory chip industry, highlighting the severity of the current global chip shortage.*
2. **Commercial Aerospace Concept Continues Strength** The commercial aerospace concept maintained its momentum from last week, with Diankelantian rising over 10% to set another new post-IPO high, following Jiunda Shares' two consecutive limit-ups. Zhonghang Guangdian, Chunhui Zhikong, Xinwei Communication, Xinke Mobile, and Xice Testing followed with gains. *Commentary: At the Second Aerospace Information Technology Conference opening on May 9, the Aerospace Information Research Institute of the Chinese Academy of Sciences, along with over a hundred research institutes, universities, and aerospace enterprises, jointly released the "Initiative for Co-building the 'Space Cloud' Ecosystem," calling on the industry to collaborate in constructing a thousand-satellite-scale "space cloud" ecosystem to build a world-leading space-based information service system.*
**Institutional Views**
**China Galaxy Securities: Market May Face Consolidation and Increased Differentiation in the Short Term** In the near term, U.S.-Iran conflicts may continue to cause intermittent disturbances, but market sensitivity to external conflict events has weakened, with marginal impact diminishing. Subsequent events such as Trump's visit to China and the Federal Reserve chair transition will become external focal points. Domestically, structural bright spots are prominent amid the economic recovery, providing earnings support for the upward market trend. As the Shanghai Composite approaches 4200 points, the market may experience consolidation and heightened differentiation in the short term. The overall upward trend remains unchanged, with sector rotation and structural opportunities likely to persist. We continue to emphasize focusing on main thematic opportunities and seizing structural allocation directions.
**CITIC Securities: Active Volatility Reduction is a Preferable Choice Amid Strengthening Structural Trends** The momentum in tech stock rallies across China, the U.S., Japan, and South Korea has been strengthening. However, even the strongest industry trends can lead to sharp volatility if short-term slopes become too steep. The ChiNext Index's latest MSI (Momentum Strength Index) reading is 64.4, still within a historically reasonable range. Notably, before the pullback on May 8, the reading on May 7 was 71.9, very close to the critical threshold of 75 for the strong acceleration zone. Even with strong AI-related industry trends, abnormal momentum intensity and steep short-term ascent slopes likely imply increased subsequent volatility. In this context, for existing funds, actively reducing portfolio volatility may be a better choice.
**Eastmoney Securities: AI Industry Trend is Primary; Market Sentiment and Capital Flows are Derivative** In the three trading sessions after the May Day holiday, the communications and electronics sectors led the market, confirming that AI prosperity diffusion has become the core线索 post-"April Decision." The priority of main theme observation indicators is: U.S. AI capital expenditure > China's computing hardware import substitution > commercialization of China's AI applications. This is because the AI industry trend is primary, while market sentiment and capital flows are derivatives of the industry trend. Only when AI Capex maintains high growth can the sustainability of the main theme be financially supported; other segments such as import substitution and application catch-up are extensions and diffusions of the main theme. The collective upward revision of 2026 Capex guidance by North America's four major cloud providers and the expectation of high growth in 2027 have alleviated market concerns about "AI capital expenditure peaking." Signals such as token volume expansion, in-house chip development by major firms, continued commercialization realization, and year-on-year improvement in ROIC further reinforce the sustainability of the prosperity.
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