On April 7, the three major A-share indices collectively closed higher, with nearly 4,000 stocks rising across the market. The total trading volume in the Shanghai, Shenzhen, and Beijing markets reached 1.62 trillion yuan, a decrease of 45.3 billion yuan from the previous trading day.
The chemical sector experienced a full-scale breakout, possibly due to an explosion at the Jubail Industrial Zone in Saudi Arabia—a significant petrochemical production base accounting for 6% to 8% of global output—which was impacted by Middle Eastern conflicts. This event has led to a premium being placed on China's chemical production capacity, known for its supply chain resilience. The Huabao Chemical ETF (516020), which has over 80% weight in petroleum, petrochemicals, and basic chemicals, saw its on-market price surge by 3.64%.
Samsung Electronics reported stellar first-quarter results, with operating profit increasing more than sevenfold to a record high. Coupled with a further 30% price hike in Samsung memory chips, this boosted the storage chip sector. The Huabao Science and Technology Innovation Chip ETF (589190), which fully invests in the chip industry, rose sharply by 2.02%. Foxconn's trial production of Apple's foldable iPhone benefited the Apple supply chain. The Huabao Electronic ETF (515260), which covers both the Apple and semiconductor industrial chains, increased by nearly 2% during the session and closed up 1.3%.
Pork prices hit their lowest point in over a decade, prompting the central government to initiate pork purchases to support the market. The market's first Agriculture, Animal Husbandry, and Fishery ETF (159275) saw its on-market price climb as much as 2.65% intraday, eventually closing up 1.38%. Is the medical sector launching another offensive? The A-share medical sector experienced a pattern of rising then falling but overall performed stronger than the broader market. The largest medical ETF by scale, the Huabao Medical ETF (512170), rose up to 1.85% in the morning session. With the Hong Kong market closed, the Huabao Hong Kong Stock Connect Medical ETF (159137), listed on the A-share market, warmed up in advance, closing up 0.87%.
CSC Financial believes that the ongoing escalation and complexity of the Middle East situation are causing market fluctuations around negotiation signals. Simultaneously, military actions in the region are shifting from airstrikes to preparations for ground operations. The next 2-3 weeks remain a high-risk period where the situation could deteriorate sharply, leading the market to await a buying opportunity. On the other hand, internal fundamental factors deserve renewed attention, as a series of data points collectively indicate a positive economic trend. With March economic data soon to be released and earnings season approaching, market focus will gradually shift to verifying the strength of the economic recovery and the actual improvement in corporate profits.
The institution recommends patiently building positions along three themes: energy security and inflation, assets with certain growth, and sectors benefiting from policies and peak season demand. Key industries to focus on include power equipment, utilities, chemicals, the AI industrial chain, innovative drugs, the infrastructure chain, and service consumption.
The chemical sector led a strong charge throughout the trading day. The Huabao Chemical ETF (516020), which reflects the overall performance of the chemical sector, rose quickly after opening and maintained high-level fluctuations before surging again towards the close, ending the day with a 3.64% increase in its on-market price.
Among its component stocks, shares in petrochemicals, synthetic resins, nitrogen fertilizers, and other segments led the gains. By the close, Hengyi Petrochemical, Shengquan Group, and Luxi Chemical Group hit the daily limit-up, while Hualu Hengsheng soared 9.43%. Junzheng Group, Baofeng Energy, and Yangnong Chemical also posted significant gains.
Notably, the chemical sector's performance this year has significantly outperformed the broader market. Data shows that as of today's close, the Segmented Chemical Industry Index, which the Huabao Chemical ETF (516020) tracks, has accumulated a gain of 4.01% year-to-date, markedly better than major A-share indices like the Shanghai Composite Index (-1.98%) and the CSI 300 Index (-4.09%) over the same period.
On the capital flow front, the basic chemical sector continued to attract strong inflows from main funds. Data indicates that by the close, the basic chemical sector saw a net single-day inflow of over 12 billion yuan from main funds, ranking first among the 30 CITIC primary industries.
Some analysts point out that recent market concerns about the economy have led to a certain correction in the chemical sector, which may be an overreaction. 2026 could be an inflection point for the sector's upward trajectory, with the industry currently characterized by strong reality but weak expectations. Geopolitical events might present a new opportunity for the rise of China's chemical industry. The medium to long-term upward trend for the sector remains promising.
Looking ahead, Kaiyuan Securities stated that short-term regional conflicts intensifying could lead to overseas orders shifting to China, potentially boosting domestic demand for chemical products and supporting price stability. In the medium to long term, if global crude oil supply normalizes, the restart of affected overseas facilities will take time, likely triggering at least one round of global inventory replenishment demand for chemical products. They are optimistic about a value revaluation for Chinese chemical assets.
For investors looking to capture opportunities in the chemical sector, using the Huabao Chemical ETF (516020) may offer a more efficient approach. Public information shows that the Huabao Chemical ETF (516020) tracks the CSI Segmented Chemical Industry Theme Index, with the combined weight of the petroleum, petrochemical, and basic chemical sectors exceeding 80%. Off-market investors can also access the chemical sector through the Huabao Chemical ETF Link Fund (Class A 012537 / Class C 012538).
The A-share medical sector showed strength relative to the broader market despite a pattern of rising then falling. The largest medical ETF by scale, the Huabao Medical ETF (512170), rose up to 1.85% intraday, with a full-day amplitude of 2.42% and a trading volume of 438 million yuan. With the Hong Kong market closed, the Huabao Hong Kong Stock Connect Medical ETF (159137), listed on the A-share market, closed up 0.87%.
Among the 50 medical leaders covered by the Huabao Medical ETF (512170), 28 stocks closed higher. Glove leader Intco Medical led the gains throughout the day, soaring over 14% intraday to hit a new three-year high, and closed up 9.69%. Geopolitical factors driving a surge in crude oil prices have significantly increased chemical costs, which may lead to substantial price hikes for disposable gloves.
CSC Financial suggests increasing allocations to the medical device sector in 2026. In the short term, they recommend seizing opportunities for earnings and valuation recovery in stocks showing improved performance, while also paying attention to new technology directions like surgical robots and brain-computer interfaces. Long-term investment opportunities in the sector stem from innovation, global expansion, and mergers and acquisitions, with valuations currently undergoing reconstruction.
CXO leaders showed divergent performances today. WuXi AppTec rose 1.31%, while Asymchem Laboratories and Joinn Laboratories fell over 2%. Despite mixed stock movements, the CXO earnings logic remains intact. The Huabao Medical ETF (512170) covers 8 CXO leaders, with a combined weight of 25%. Currently, 7 of these companies have disclosed their 2025 earnings, with only Pharmaron reporting a single-digit year-on-year decline in net profit. Joinn Laboratories, Porton Pharma, Tigermed, and WuXi AppTec all reported net profit growth exceeding 100%!
Huafu Securities emphasized the importance of "valuing the strategic allocation value of CXO for the full year!" Soochow Securities also noted that with improving investment and financing sentiment and driven by new drug molecule technologies, the CXO industry's prosperity is expected to continue rising.
For one-stop investment in medical leaders, the recognized configuration tool is the largest medical ETF by scale, the Huabao Medical ETF (512170), and its off-market link fund (012323), heavily weighted in medical devices and medical services (with 25% CXO exposure). Investors seeking stronger offensive capabilities can opt for the high-elasticity, T+0 tool—the Huabao Hong Kong Stock Connect Medical ETF (159137), which focuses on medical innovation with over 40% CXO exposure and covers popular themes like AI healthcare, brain-computer interfaces, and innovative drugs and devices.
The electronics sector attracted a net inflow of 8.8 billion yuan from main funds throughout the day, ranking second in fund attraction among the 31 Shenwan primary industries. Cambricon Technologies saw massive buying from main funds, amounting to 2.841 billion yuan, topping the A-share fund attraction list.
Among popular ETFs, the Huabao Electronic ETF (515260), which covers both the Apple supply chain and the semiconductor industrial chain, saw its on-market price rise up to 1.95% intraday, closing up 1.3%. Notably, the ETF showed a significant on-market premium, with a closing premium rate of 0.81%, indicating stronger buying pressure.
Among component stocks, Cambricon Technologies led with a gain of over 9%. Huaqin Technology, Shengbang Microelectronics, and Shengyi Technology rose over 5%, while Inspur Information and SMIC followed with gains.
Regarding the Apple supply chain, Foxconn has begun trial production of Apple's foldable iPhone. Industry insiders indicate that Apple is expected to capture about 28% market share in 2026, approaching Samsung's leading position. Huaxi Securities stated that Apple's accelerated entry into the foldable phone market is expected to drive rapid volume growth for foldable phones and lead innovation upgrades in the foldable supply chain.
For the semiconductor industrial chain, global giant Samsung Electronics reported explosive first-quarter results, with operating profit surging over sevenfold to a record high, primarily driven by soaring demand and price increases for memory chips fueled by the global AI industry. In fact, with Samsung memory chips raising prices by another 30%, AJ Securities believes the global memory chip market's price hike cycle is likely to continue into 2026.
Fundamentally, the electronics sector is experiencing a wave of positive earnings reports. As of April 6, 24 component stocks of the Huabao Electronic ETF (515260) had released their 2025 annual reports. Among them, 23 listed companies achieved profitability, and 21 reported double-digit year-on-year growth in net profit attributable to parent shareholders. Cambricon Technologies, Shenghong Technology, and TCL Technology saw their net profits attributable to parent shareholders surge by 555.24%, 273.52%, and 188.78% year-on-year, respectively.
Sinolink Securities pointed out that the electronics industry currently benefits from the explosion in AI computing power demand. Core driving factors include global tech giants' capital expenditures exceeding expectations, continuous price increases for memory chips, and the acceleration of semiconductor material localization. They recommend focusing on areas likely to exceed Q1 earnings expectations, such as AI computing hardware, memory chips and modules, and passive components.
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