Here are the key evening market updates: Beijing has further relaxed its real estate policies, cutting the social insurance or tax payment requirement for non-Beijing households to purchase properties within the 5th Ring Road from two years to one year.
U.S. non-farm payrolls unexpectedly declined by 23,000 in July, missing the market consensus for an 80,000 increase. The unemployment rate fell to 4.1%, a two-year low, while average hourly earnings growth slowed to 3.2% year-over-year, below the 3.5% forecast. In response, U.S. stock index futures rallied, with Nasdaq futures briefly surging over 1%, spot gold rose, and the U.S. dollar index dropped 30 pips as traders reduced their bets on a Federal Reserve rate hike.
A positive signal has emerged from the optical communications sector. Applied Optoelectronics (AAOI) shares surged over 18% in pre-market trading after reporting a 86% year-over-year revenue jump in the second quarter, with 800G product revenue doubling sequentially. Management highlighted strong AI infrastructure demand, with customer demand exceeding supply capacity by 20-40%. The company plans to boost its combined monthly production capacity for 800G and 1.6T products to over 650,000 units by the end of 2026 and further to 930,000 units by the end of 2027.
President Donald Trump is scheduled to convene a meeting with executives from major global mining companies at the U.S. State Department to discuss securing critical mineral supplies for the U.S. and its allies. This event could serve as a catalyst for strategic small metals in the A-share market, potentially boosting the valuation of rare earths, tungsten, germanium, and scandium. However, while the U.S. may accelerate its collaboration with overseas miners, Chinese mining firms are unlikely to secure direct cooperative orders, leaving the impact more sentiment-driven and tied to global price expectations.
The People's Bank of China has added gold to its reserves for the 21st consecutive month, with holdings rising to 76.08 million ounces in July from 75.44 million ounces in June. The 640,000-ounce increase marked the largest single-month purchase in this cycle. CITIC Securities believes that gold prices, supported by easing geopolitical tensions, the potential for more accommodative Fed policy, and rising U.S. deficits, will resume their upward trajectory, potentially surpassing all-time highs by early 2027.
SK Hynix is investing approximately 54.3 trillion won ($38.3 billion) to build two new wafer fabs in South Korea, expanding DRAM and NAND production capacity to meet AI-driven demand for HBM and advanced memory. The investment, to be completed by 2031, will see the first cleanrooms begin production as early as late 2028, solidifying the company's lead in the HBM market.
Unitree Robotics, during its IPO roadshow, responded to questions about a U.S. ban on robot sales. The company stated that the current policy changes will not affect the continued sale of its existing major products in the U.S. market. Additionally, the company confirmed a strategic partnership with DeepSeek, which will participate in its IPO as a cornerstone investor.
Multiple fund managers have filed for ETFs tracking the GEM (ChiNext) computing infrastructure index and the GEM fintech index. These include 10 firms for computing ETFs and 6 for fintech ETFs, which will focus on stocks like Jingjia Micro, Zhongji Innolight, and East Money Information.
Former President Trump has signaled a desire for lower interest rates, but his tone toward the Federal Reserve appeared more conciliatory, acknowledging that rate decisions are not solely up to the Fed Chair. In an interview, he said that rate cuts depend "partly on him, but not entirely," while criticizing some Fed board members for having political leanings.
Investment Opportunities
China's power load hit a new all-time high of 1.557 billion kilowatts on August 7, the fourth such record this summer. The load has remained elevated since July 29, with daily peaks consistently exceeding last year's record. CCTV Securities notes that while El Nino provides short-term catalysts for the power sector, the core long-term driver is the tightening supply-demand balance, as continued losses in renewable energy lead to reduced capital spending and new capacity additions, while coal prices provide a floor, pushing electricity prices into an upward cycle.
Other sectors to watch include aviation, storage chips, zirconia, Apple suppliers, and rare earths. The 15th Five-Year Plan for civil aviation has been issued, DDR4 spot prices have surged six-fold, and Foxconn is ramping up hiring for iPhone production.
Company Announcements
Positive news: Cambricon Technologies reported a net profit of 2.311 billion yuan for the first half of 2026, a 122.61% year-over-year increase. Biwin Storage’s subsidiary plans to introduce investors via a capital increase. Chaoying Electronics will invest 2.086 billion yuan in a new PCB project. China Rare Earth reported a net profit of 237 million yuan for the first half, up 46.53% year-over-year.
Negative news: *ST Shida is under investigation by the China Securities Regulatory Commission for alleged information disclosure violations in its 2023 half-year report. Suo’er shares reported a 42.83% drop in net profit. Telink Semiconductor has terminated its plan to acquire assets via share issuance. Zhongzhi Technology reported a 2.76% decline in net profit.
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