Market Open Briefing
1. US Treasury intervention steadies markets; Moderna surges 176%
US stocks snapped a three-session losing streak after the Treasury Department moved to address bond market concerns. In sector news, a breakthrough in cancer vaccine development sent Moderna, Inc. (MRNA.US) shares skyrocketing 176.97% in a single session. The surge lifted the entire pharmaceutical sector, with global top-four drugmakers by market value — Eli Lilly, Johnson & Johnson, AbbVie, and Merck — all closing at record highs. The Nasdaq Biotechnology Index jumped 6.39%, also hitting an all-time high.
2. NDRC convenes meeting on 'Six Networks' major project coordination mechanism
On August 19, Yue Xiuhu, Deputy Director of the National Development and Reform Commission, chaired a meeting on the coordination mechanism for major projects under the 'Six Networks' initiative. The meeting focused on establishing a '2+3+N' framework (2 grid operators + 3 telecom carriers + N computing-related enterprises) to strengthen coordination across computing networks, new power grids, and next-generation communication networks, aiming to accelerate the construction of major projects through unified efforts.
3. Fed minutes reveal hawkish tone; several officials keep rate hike option open
Minutes from the Federal Reserve's latest meeting, released early Thursday Beijing time, showed a significant number of officials believe a rate hike would be necessary if progress on inflation stalls. Officials also highlighted financial risks stemming from the AI boom, warning about the potential transmission of high valuations and borrowing-driven expansion into the credit system.
4. Trump announces 'harshest economic action ever' against Iran
On August 19, President Trump announced on his social media platform 'Truth Social' that Iran had failed to seize the opportunity for a deal, prompting him to impose what he called the 'most severe economic action ever taken against any country.' He described it as an unprecedented 'economic war and economic isolation.' Trump warned that any nation allowing its financial institutions, businesses, airports, or government entities to support Iran would face 'enormous economic consequences.'
5. SK Hynix jumps 5% on 40 trillion won buyback plan; Samsung may follow
SK Hynix announced Wednesday it would repurchase and cancel treasury shares worth 40 trillion won (approximately $28.6 billion), committing to return at least 50% of free cash flow generated between 2025 and 2027 to shareholders. Further details on shareholder returns are expected when the company releases third-quarter earnings. Overnight, SK Hynix's US-listed shares rose as much as 5% before closing up 0.35%.
Investment Calendar
Loan Prime Rate announcement scheduled.
Investment Tip
'On the magician's stage, we see things that don't actually exist, just as we see things in buying stocks that aren't real.' — John Magee, 'The Psychology of Stock Market Trading'
Institutional Views
1. Orient Securities: The current pullback stems from short-term sentiment and trading-level disruptions; once risks are released, the market is expected to resume its upward trajectory.
2. Guotai Haitong: Stabilizing forces have successfully intervened to block tail risks, and China's stock market is set to gradually enter an 'autumn rally' phase.
3. Shenwan Hongyuan: The virtuous cycle of capital inflows will be hard-pressed to quickly return to late-June levels; computing power chains and AI small-caps offer higher elasticity.
Positive and Negative Outlook
1. Spot gold jumps 4.35%, breaks above $4,500/oz
CITIC Securities expects the impact of Strait of Hormuz tensions on gold prices to shift from suppression to support. With Fed monetary policy potentially more dovish than expected and surging US defense spending widening deficits, gold prices are projected to re-enter an upward channel within the year.
2. Shanghai advances 6G trial networks for intelligent coordination and commercial deployment
China Galaxy Securities notes that domestic 6G R&D is accelerating, with supportive industrial policies being rolled out frequently. Satellite communications, space-air-ground integration, and ubiquitous connectivity are jointly driving sector growth, offering long-term expansion potential. The firm recommends focusing on three investment lines: operators, 6G primary equipment makers, and satellite internet.
3. Samsung raises chip manufacturing prices by up to 15%
China Merchants Securities advises attention to storage benefiting from supply-demand tightness, computing power and foundry segments with sustained demand growth, and equipment/materials in the capacity expansion cycle. It also suggests monitoring core constituents of major tech and semiconductor indices.
Announcement Digest
Positive announcements:
1. Foxconn Industrial Internet: First share buyback completed — 2.4144 million shares repurchased for 149 million yuan.
2. AMEC: H1 2026 net profit of 2.825 billion yuan, up 300.22% year-on-year.
3. Hunan Yuneng: H1 2026 net profit of 2.91 billion yuan, surging 853.51% year-on-year.
Negative announcements:
1. Infotmic: Received a non-opposition decision from anti-monopoly review on concentration of undertakings.
2. Huifeng Agrochemical: Issued warning letters for inaccurate information disclosure in 2023 and 2025 periodic reports.
3. Wantai Biological: H1 2026 net loss of 128 million yuan.
Overseas Markets
Note: The US Treasury's emergency intervention to address bond market concerns lifted all three major indices, with gold, silver, and non-ferrous metals sectors posting broad gains. Among the 'Magnificent Seven' tech giants, all rose except Nvidia. Storage and optical communications sectors declined, with Seagate Technology down over 7% and Coherent falling more than 6%. The Nasdaq Biotechnology Index climbed 6.4%, marking its biggest one-day gain in six years.
Comments