In recent days, many investors have left messages in the background, with some pointing out that "the implementation of positive news is key, but sustainability matters most"—hitting the nail on the head. Lately, there has been no shortage of positive developments across industries, policies, and individual stocks, yet the phenomenon of "one-day enthusiasm, three-day cooling" remains prominent in capital flows. This is partly tied to the market's shrinking volume during the bottoming phase, and partly influenced by uncertainties surrounding overseas geopolitical situations and interest rates.
However, from a contrarian perspective, there is room for less pessimism. On one hand, positive factors are emerging, such as expectations that Trump's conflict with Iran will conclude by November this year, following the U.S. midterm elections. On the other hand, a host of individual stocks are either launching from low levels or staging V-shaped reversals, including Far East Smarter Energy, Eton Electronics, Xunxing Technology, Lianxun Instruments, Yuanjie Technology, and Jinlu Electronics. While the probability of gains may be declining, the odds remain attractive. These bottoming patterns are signals that major players are gearing up for a rally.
The Bottoming Phase Presents Opportunities for Major Players to Act
In the current market, upside momentum is weak, but downside is supported. The bottoming period can be somewhat taxing, yet major players seem far from idle. A random review of recent market activity reveals several typical or distinctive stock patterns—V-shaped right-side reversals, where a single day's surge instantly recovers months of declines. In the trading details, large-block orders are frequently sweeping up shares, pointing to behind-the-scenes maneuvering by major forces.
A one-day rally recovering nearly two months of losses is exemplified by Zhaolong Interconnect (300913). Optical communications and fiber optics have been performing recently, driven by gains in U.S. stocks like Corning and Lumentum. Although the momentum lacks persistence, some stocks seem to rise precisely when investors are hesitant to buy. On September 9, Zhaolong Interconnect hit a "20cm" limit-up shortly after the market opened, with heavy volume at low levels, but the board subsequently opened. The price at the limit-up level had already freed trapped positions from since July. The company's business involves optical cables and fiber optic connectors, and as fiber optics heat up, it directly benefits.
The trajectory of Far East Smarter Energy has been a source of frustration for those waiting on the sidelines for a pullback. Around 2:28 PM on September 9, 400 million yuan in major capital poured in, instantly pushing the stock to a limit-up. Notably, since August, its share price has been climbing steadily with expanding volume, and gains have approached 100% at one point (see Figure 1). Between September 24, 2024, and late June 2026, the company's stock surged tenfold. Far East Smarter Energy also benefits from the fiber optics boom, with an annual production capacity of 300 tons of optical preforms and 10 million core-kilometers of optical fiber.
Eton Electronics (603328) is another typical case, quickly hitting a limit-up shortly after the midday break on September 9. It established a low-level reversal in early August, consolidated sideways for nearly a month, and then broke out with a limit-up. Eton Electronics is tied to the PCB concept, and on August 6, it revealed plans to raise 2 billion yuan to invest in a high-end PCB project.
Yihao New Materials (301176), which hit a "20cm" limit-up intraday on September 10, has frequently experienced "limit-up then board breakdown" scenarios, but the tactics of its major players are far from ordinary. Around 11:30 AM on September 10, major forces launched an offensive, using consecutive large orders to push the stock to a limit-up. A month earlier, the stock had been in a nearly month-long shrinking-volume consolidation (see Figure 2). Yihao New Materials also has a PCB concept, with its electronic circuit copper foil serving as the core conductive substrate for copper-clad laminates and PCBs.
A broader review reveals many other stocks launching from low levels and staging right-side counterattacks, including Sifushi, Qiangda Circuit, Mankun Technology, Chongda Technology, Xunxing Technology, Dingxin Communications, and Dunhuang Seed Industry.
Market Anxious Over Fed Rate Decision, But A-Share PCB Stocks Surge in Clusters
Over the next few days and week, a major market focus is the landing of the Fed's interest rate decision. Key timelines and events include: Beijing time Thursday 20:30 for the U.S. August Producer Price Index (PPI); Friday 20:30 for the Consumer Price Index (CPI); and the Fed's policy meeting on September 15-16.
The Fed's rate decision impacts the market through channels like valuations and liquidity. A review of recent Fed rate changes shows that, due to varying market valuations, economic environments, and rate levels, market reactions post-hike and post-cut have differed (see Figure 3). Yet, an overall pattern emerges: "adjustment during hiking cycles, and gains during cutting cycles."
Some argue there's no need to closely track the Fed's "starting gun," because regardless of whether rates are hiked or cut, the market has already priced in such uncertainties. Even a hike could be interpreted as "bad news fully absorbed." In fact, some sectors are acting out the mantra "market worries are their business; I rally, therefore I am"—the PCB industry chain being a prime example.
On September 9 and 10, PCB stocks staged a wave of limit-ups, with Jin'an Guoji, Ultrasonic Electronics, Huazheng New Materials, and the aforementioned Eton Electronics all hitting limit-up, many marking new highs since August. PCB concept stocks have been a recurring theme recently, driven by factors including but not limited to: 1) Next-generation AI server motherboards and accelerator cards have increased PCB layer counts to 20-40 layers, with the PCB value per AI server multiplying several times over traditional servers, fueling demand for high-end PCBs. 2) A sustained wave of price hikes across the supply chain. Rising upstream raw material costs are heating up the chain, such as electronic yarn prices surging to 13.25 yuan per meter this year, a cumulative increase of over 100%, with China Jushi officially raising September prices. Copper-clad laminate (CCL) prices have doubled within the year, as top manufacturers issue concentrated price hike notices, like Panasonic raising CCL prices effective September 1, 2026, with some products climbing up to 30%. 3) High-end capacity is in short supply, while downstream demand remains buoyant. High-end computing PCB production lines have construction cycles of 18-24 months, with leading PCB companies locking in orders through 2027.
Within the supply chain, PCB involves multiple segments including materials, CCL, and manufacturing. For materials, high-end copper foil is tied to companies like Defu Technology and Tongguan Copper Foil; electronic yarn and fiberglass to China Jushi, Honghe Technology, and Feilihua; resins to Dongcai Technology; and PCB specialty equipment to Han's CNC, Xinqi Microsystems, and Dingtai High-Tech.
CCL is a segment seeing dense stock price surges recently, with names like Shengyi Technology, Nanya New Materials, Huazheng New Materials, and Jin'an Guoji all showing strength. In PCB manufacturing, players like WUS Printed Circuit, Shennan Circuits, Victory Giant Technology, Guanghe Technology, and Shengyi Electronics are frequently announcing capacity expansions. For instance, Shengyi Electronics disclosed on August 28 a plan to invest over 2 billion yuan in a "Xinsuan Zhilian" high-speed interconnect circuit board manufacturing project.
After a day of waiting, the new positive news has finally arrived. At a State Council Information Office press conference after the close on September 10, the China Securities Regulatory Commission (CSRC) stated that year-to-date, medium- and long-term funds including social security, annuities, and insurance have collectively net purchased over 600 billion yuan in A-shares, with their holdings in A-share float market value growing 12.5% from the end of 2025. Going forward, the regulator will continue to promote steady increases in the scale and proportion of medium- and long-term funds entering the market, fully committed to maintaining stable market operations.
Looking at the long term, the continued inflow of medium- and long-term funds is shifting the market from short-term theme speculation toward long-term value discovery. As the proportion of long-term capital rises, A-share valuation systems will become more rational and stable, with valuation premiums for many high-quality leaders significantly enhancing. Who will be the next long-term leader? It may already be on the way.
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