According to a research report from China Merchants Securities (CMSC), this week's improvements in market activity were primarily observed in upstream resources, information technology, and utilities sectors. Within upstream resources, prices rose for most industrial metals, gold, and a majority of chemical products. In the midstream manufacturing sector, prices across most of the new energy industry chain declined, while the crude oil freight index showed a marginal decrease. In information technology, DDRM prices experienced a marginal decline, although the year-on-year growth rate for global semiconductor sales in February expanded. In the consumer services sector, the four-week rolling average retail sales value for air conditioners, refrigerators, washing machines, and color TVs saw a narrowing year-on-year decline, while the price of broiler chicks increased. Currently, over 70% of 2025 annual report disclosures are complete, with high profit growth or improvement concentrated in sectors linked to price increases, TMT (Technology, Media, Telecom), essential consumption, new energy, and pharmaceuticals. CMSC recommends focusing on non-ferrous metals, fine chemicals, semiconductors, power utilities, and pharmaceuticals, where activity is high or improving and earnings are expected to recover. Key views from CMSC are as follows:
[This Week's Focus] As of now, 4,080 listed companies have disclosed their 2025 performance forecasts/quick reports/full reports, representing a disclosure rate of 74%. Analyzing the median levels and marginal changes across industries, sectors expected to show high growth or marginal improvement in 2025 annual results are mainly in: 1) Price-increase chains: chemical fibers, chemical raw materials, coke, precious metals, energy metals, minor metals, etc.; 2) TMT: computer equipment, components, software development, electronic chemicals, etc.; 3) Essential consumption sectors with a low base effect or price improvements, such as baijiu, beverages and dairy products, condiments and fermented products, textile manufacturing, apparel and home textiles, personal care products, etc.; 4) Others: batteries, ground armaments, power utilities, traditional Chinese medicine, medical devices, pharmaceutical commerce, etc. Considering Q1 economic data and mid-level sector activity, CMSC recommends monitoring sectors where performance is expected to continue improving or maintain high growth, including chemicals, non-ferrous metals, semiconductors, textiles and apparel, power utilities, power equipment, and pharmaceuticals.
[Information Technology] This week, the Philadelphia Semiconductor Index and the Taiwan Semiconductor Index rose, while the DXI Index declined. DRAM memory prices decreased, though the DRAM index increased week-over-week and the NAND index remained flat. The year-on-year growth rate for global semiconductor sales in February expanded.
[Midstream Manufacturing] Prices across most of the new energy industry chain fell this week. The photovoltaic price index declined week-over-week; within the chain, the module price index was flat, while the cell, silicon wafer, and polysilicon price indices dropped. The four-week rolling average of weekly cargo throughput at Chinese ports showed an expanded year-on-year decline, whereas the four-week rolling average of weekly container throughput saw an expanded year-on-year increase. The CCFI and BDI indices rose, while the CCBFI and BDTI indices fell.
[Consumer Demand] Prices for raw milk and comprehensive sugar declined, alongside a decrease in the wholesale price of Feitian Maotai. Prices for live hogs, piglets, and average live pig prices fell. In terms of pig breeding profits, profits for both self-sustaining farms and those purchasing piglets decreased. In the broiler breeding sector, the price of broiler chicks rose. The vegetable price index and corn futures settlement price declined, while the cotton futures settlement price increased. The 10-day average of box office revenue rose, while the 10-day average movie ticket price decreased week-over-week. The four-week rolling average retail sales value for air conditioners, refrigerators, washing machines, and color TVs saw a narrowing year-on-year decline. The traditional Chinese medicine price index fell.
[Resources] The 10-day average trading volume of construction steel increased. The price of steel billet remained unchanged from the previous week, while rebar prices declined. In coal prices, the price of Qinhuangdao premium混动力煤 rose, whereas the库提price of Jingtang Port Shanxi primary coking coal fell. Futures settlement prices for coke and coking coal declined. Regarding inventory, coal inventory at Qinhuangdao Port decreased, while coking coal inventory at Jingtang Port and coke inventory at Tianjin Port increased. The national cement price index declined. Brent international crude oil prices rose. The China Chemical Product Price Index increased, with prices rising for most chemical products; diethylene glycol, methanol, and styrene led the gains, while asphalt, PVC, and fuel oil saw the largest declines. This week, prices for most industrial metals increased, with copper, aluminum, zinc, tin, and lead prices rising, while cobalt and nickel prices declined; inventories for most metals decreased. Gold spot and futures prices rose, while silver spot and futures prices fell.
[Finance and Real Estate] The money market saw a net withdrawal of funds. SHIBOR rates for overnight, 1-week, and 2-week terms declined. A-share turnover rate and daily trading value decreased. The land transaction premium rate rose, while the transaction area of commercial housing declined.
[Utilities] The factory price of natural gas increased. The 12-week rolling average of daily power generation at key national power plants showed an expanded year-on-year growth rate.
Risk warnings: Industry support may fall short of expectations, and macroeconomic conditions may fluctuate.
Comments