On May 21st, the A-share market surged initially but retreated later in the day. Brokerage stocks, dormant for some time, led a charge that briefly pushed the Shanghai Composite Index towards 4,200 points. However, all three major indices turned negative in the afternoon session, closing with losses exceeding 2%, with the Shanghai Composite falling below 4,100 points. Trading volume across the two markets expanded to 3.48 trillion yuan, with nearly 4,800 stocks declining.
In terms of sector performance, previously underperforming sectors saw a catch-up rally. The pharmaceutical and healthcare sectors remained strong throughout the day. The largest ETF of its kind, the Medical ETF Huabao (512170), saw its intraday price surge over 4% before closing up nearly 1%. Meanwhile, the 100% innovative drug-focused HK Connect Innovative Pharma ETF Huabao (520880) saw its intraday price jump nearly 3%, closing with a gain of 1.58%. Both ETFs have attracted substantial capital inflows during the recent pullback, with 512170 and 520880 seeing inflows of 289 million yuan and 715 million yuan respectively over the past 10 trading days.
The traditional "dual flag-bearers of a bull market" showed strength. Huaan Securities hit the daily limit-up in the morning session. The heavyweight Brokerage ETF Huabao (512000), with assets over 36 billion yuan, saw its intraday price surge up to 4%. The largest ETF tracking the same benchmark, the Fintech ETF Huabao (159851), surged nearly 5%. Although it turned negative in the afternoon with the broader market, it still attracted massive net subscriptions of 398 million shares.
Hot sectors like semiconductors and computing hardware experienced significant volatility, rising sharply in the morning before pulling back substantially. The Hard Tech Broad-based ETF Huabao (588330), which covers 50 high-growth leaders from the ChiNext and STAR markets, saw its intraday price rise over 2% before retreating to close down 2.55%. The STAR Chip ETF Huabao (589190), offering pure exposure to the chip industry, swung dramatically, closing down 4.91% after an 8.21% intraday range. The ChiNext AI ETF Huabao (159363), with over 50% exposure to CPO (Co-Packaged Optics) modules, closed down 4.34%, marking its sixth consecutive daily decline, yet it still saw a net subscription of 68 million shares, following over 300 million yuan in inflows over the previous five days.
Is a market style rotation underway? Analysis suggests that while the tech growth theme faces short-term headwinds, its medium-term uptrend remains intact. Before the global tech rally loses steam, the hard tech style in the A-share market may persist. Galaxy Securities posits that the market is more likely to experience rotation within the growth sector itself, with low-valuation value sectors staging periodic rallies to stabilize the market and hedge volatility, ultimately forming a balanced rotation pattern led by growth, supplemented by value.
[ETF Focus Review] The following sections delve into the trading dynamics and fundamentals of the innovative pharma, fintech, and the dual-innovation (ChiNext+STAR) sectors.
[Has the Catch-Up Rally Begun? Innovative Pharma Stands Out Against the Trend! Huabao Fund's HK Connect Innovative Pharma ETF (520880) Rises 1.58% on Heavy Volume, as Massive Capital Flows into Lagging Sectors] The A and H-share markets plunged in the afternoon, yet the innovative pharma sector demonstrated resilience. The Pharma ETF Huabao (562050), heavily weighted in A-share innovative drug stocks, and the 100% innovative drug-focused HK Connect Innovative Pharma ETF Huabao (520880) both closed in positive territory, significantly outperforming the broader market. Notably, both ETFs hit new all-time lows just the previous day.
Specifically, Dizal Pharmaceutical surged 10.69%, leading gains in the A-share pharmaceutical sector. Heavyweight stock BeiGene rose 3.27%. The unique Pharma ETF Huabao (562050) rose as much as 2% before paring gains with the market, ultimately closing higher and ending a six-day losing streak.
The HK Connect innovative pharma sector stood out. ETF 520880 rose nearly 3% in the morning, closing up 1.58% on heavy volume, ending a seven-day decline. Daily turnover reached 482 million yuan, a surge of over 50% from the previous day. Leading index heavyweights supported the gains, with Akeso, Innovent Biologics, and Kelun-Biotech all rising around 4%.
During the sector's recent consecutive decline, significant capital flowed into leading innovative pharma companies via the HK Connect Innovative Pharma ETF Huabao (520880), with over 710 million yuan in net inflows over the past 10 days, pushing its fund share total to a new high of 5.982 billion shares.
Is an inflection point near? Analysis indicates that today's rebound in HK Connect innovative pharma may primarily be a technical bounce from oversold conditions. Whether a sustained uptrend can form depends on subsequent catalysts from the ASCO annual meeting data and continued capital inflows. Guolian Minsheng Securities previously noted that a bottoming and upward move for innovative pharma in the near-to-medium term is highly probable, and market rotation away from tech could benefit the sector.
Short-term, the ASCO (American Society of Clinical Oncology) Annual Meeting is scheduled for May 29th to June 3rd. Chinese pharmaceutical companies have 94 studies selected for oral presentations this year. Historically, the period around ASCO often serves as a window for sector rallies. If clinical data exceeds expectations, further sector recovery is possible. Additionally, the 2026 National Reimbursement Drug List (NRDL) adjustment work plan is expected to be officially released by the end of this month, offering potential policy catalysts.
To invest in core innovative pharma assets at relatively low levels, consider these two key instruments: For pure innovative pharma exposure, consider the HK Connect Innovative Pharma ETF Huabao (520880). It offers 100% exposure to innovative drug R&D companies, with its top ten holdings comprising over 70% of the portfolio, highlighting its focus on leaders. Its underlying assets are Hong Kong-listed stocks, offering high volatility and T+0 trading. For investors seeking to reduce volatility, the unique Pharma ETF Huabao (562050) offers a "70% innovative pharma + 30% traditional Chinese medicine" allocation, a scarce combination in the market, blending the high growth of innovative drugs with the high dividends of traditional Chinese medicine.
[Is a Window Opening for Fintech? Huabao Fund's Fintech ETF (159851) Attracts Nearly 400 Million Shares in a Single Day! Internet Finance Shows Activity, with Tonghuashun Rising Over 4%] As the market rotates from high-flyers to laggards, the fintech sector showed activity. Internet finance stocks rose against the market trend, with Tonghuashun leading gains over 4%, followed by DZH Holdings up 3.78%, and Compass and East Money rising over 1%. However, the financial IT concept weakened in the afternoon, with stocks like Zhaori Technology, Newtouch Software, and Kelan Software falling over 5%.
Regarding popular ETFs, catalyzed by the rise in internet finance stocks, the largest Fintech ETF Huabao (159851) surged nearly 5% in the morning. However, dragged down by the financial IT sector in the afternoon, it turned negative to close down 0.41%, with an intraday range near 6% and heavy turnover exceeding 700 million yuan. Capital accelerated its entry, with a massive single-day net subscription of 398 million shares.
The fintech sector may currently be at a strategic entry point characterized by high industry景气度, strong catalysts, and low valuations. On one hand, sustained active market trading and deep integration with AI technology provide solid fundamental support for internet券商 and financial IT firms. On the other hand, following a pullback, sector valuations have retreated to near three-year lows, coupled with supportive policy tailwinds, offering both safety margin and potential upside.
Trading activity remains robust, with the two-market turnover exceeding 2.5 trillion yuan for 20 consecutive trading days. Fintech's strong beta characteristics suggest the sector could continue benefiting from high liquidity: fundamentals for internet券商 are expected to improve, while financial IT, as a pro-cyclical, high-volatility segment, also benefits from high liquidity. Demand for C-end stock trading software is rising, and B-end financial IT demand is gradually being released.
In financial IT, AI has become a core driver for financial institutions. As financial institutions continue to increase technology investment and AI large language models integrate deeply into financial scenarios, leading financial IT vendors with strong productization capabilities and technological moats are poised to maintain leadership. Fintech出海 also opens broader growth avenues.
Valuation-wise, the fintech sector is at a low level. As of May 21, 2026, the Fintech Index has retreated over 28% from its high on August 25, 2025, suggesting a relatively full technical correction. Its dynamic P/E ratio stands at 53 times, at the 23rd percentile over the past three years, indicating significantly lower valuations and improved risk-reward profile given its high-volatility nature.
Looking ahead, Soochow Securities states that the fintech sector's fundamentals and valuations are both at low levels, presenting notable配置价值. With policy support, economic stabilization, and accelerating digital transformation需求 from券商, the fintech market is gradually entering an upward channel.
To capture fintech opportunities from multiple angles, investors may consider the Fintech ETF Huabao (159851) and its feeder funds (Class A: 013477, Class C: 013478). Its underlying index is heavily weighted in computer and non-bank financial sectors, comprehensively covering internet券商, financial IT, cross-border payments, AI applications, and other热门 themes. The Fintech ETF (159851) holds over 10 billion fund shares, ranking first by a wide margin among the 8 ETFs tracking the same index.
[Nvidia's Post-Earnings Volatility: Is Tech Unjustly Sold Off? Dual-Innovation 50 ETF Hits New High Before Closing Lower; 588330 Shows Premium at Close! Institutions: Tech May Remain a High-Growth Direction!] The market's initial surge gave way to a retreat, with all three major A-share indices falling over 2%. The Hard Tech Broad-based ETF Huabao (588330), covering 50 high-growth leaders from the ChiNext and STAR markets, saw its intraday price rise nearly 2.5% in the morning,刷新 its post-listing high since May 14th and setting a new record high. It later consolidated and pulled back with the market,最终 closing down 2.55%. Daily turnover exceeded 100 million yuan, a 32% increase from the previous day.
The ETF's突破 of its post-listing high on heavy volume could be a buying signal. In fact, the Dual-Innovation 50 ETF Huabao (588330) has frequently traded at a premium recently, with a high premium at the close of 0.53%, indicating stronger buying pressure. Coupled with放量 trading, capital may be entering on dips.
Among its constituents, medical device leader United Imaging Healthcare rose 10% against the market trend, while Mindray Medical gained over 2%. Semiconductor leader Montage Technology rose over 1%, among the top gainers. Conversely, semiconductor leaders Nexchip and China Resources Microelectronics fell 9.1% and 8.86% respectively, and光伏 leader Jingcheng机电 dropped over 7%, dragging on the index performance.
On the news front, Nvidia,作为 the global AI bellwether, saw its stock volatility potentially affecting risk appetite for the A-share tech sector. Nvidia reported its latest quarterly earnings after the U.S. market closed on Wednesday. Despite strong results and guidance exceeding Wall Street expectations, its stock initially fell over 3% in after-hours trading before paring losses to 1.2%. One key reason is that market expectations were already elevated before the report; investors focused on whether the growth magnitude was sufficiently "above expectations" to justify its high valuation and prior massive gains.
Industry insiders提醒 investors not to overreact to Nvidia's initial after-hours move. While companies like Amazon and Alphabet are ramping up their own AI infrastructure, Nvidia's GPUs continue to offer superior long-term value compared to competitors' products. Nvidia's业绩表明 that despite rapid growth, the AI spending cycle is still in its early stages.
Looking forward, GF Securities believes tech will likely remain a high-growth direction. The industry trend for tech has not been disproven; the trend component is more important than volatility. Within the range of healthy long-term moving averages, there is still positive expectation three months after情绪过热. Furthermore, with the半 annual report window approaching in two months (A-share companies disclose半 annual report forecasts before mid-July; U.S. companies start reporting正式半 annual reports from mid-July), the market enters an effective phase of earnings定价, where tech is likely to remain a high-growth direction.
Data shows that the Dual-Innovation 50 ETF Huabao (588330), covering 50 high-growth leaders from ChiNext and STAR, is fully invested in the方向 of new quality productive forces. Its underlying index (the S&P China A-Share ChiNext & STAR 50 Index) has surged 129.08% over the past year, significantly outperforming major indices like the ChiNext 50 (108.14%) and the STAR 50 (84.08%), leading among hard tech broad-based ETFs.
Data period: May 20, 2025 - May 20, 2026. The S&P China A-Share ChiNext & STAR 50 Index annual returns for 2021-2025 were: 0.37%, -28.32%, -18.83%, 13.63%, 60.86%. Index constituents are adjusted according to its methodology. Past index performance does not predict future results.
[Unfazed by Rotation, Bundle China's Core Hard Tech in One Click] The hard tech broad-based ETF – Dual-Innovation 50 ETF Huabao (588330) and its场外 feeder funds (Class A: 013317 / Class C: 013318). Its underlying index selects the 50 largest strategic emerging industry listed companies from the STAR and ChiNext boards,囊括热门 themes like optical modules, semiconductors, and光伏 equipment. It benefits from a 20% daily price limit, potentially allowing for quicker rebounds.同时, this ETF is eligible for【margin trading】and【Stock Connect】, making it an efficient tool for one-click exposure to new quality productive forces.
Source: SSE, SZSE, etc. Data as of May 21, 2026. Note 1: Largest Medical ETF Huabao (512170): As of April 30, 2026, Medical ETF Huabao had assets of 27.539 billion yuan, ranking first among all 24 A/H-share医疗类 ETFs in the market. Note 2: Unique Pharma ETF Huabao (562050): According to exchange data, as of the current date, Pharma ETF Huabao is the only ETF tracking the CSI制药 Index in the market. Note 3: Fund fee details are available in respective fund legal documents. Institutional views reference sources: ① Galaxy Securities, May 18, 2026, "External Complexity Persists, A-Share Main Theme Remains Clear"; ② Guolian Minsheng Securities, May 17, 2026, "Pharmaceutical Industry Weekly: Oral Weight-Loss Drugs Enter Volume Expansion Phase, How Should the Supply Chain Be Proactively Configured?"; ③ Soochow Securities, April 9, 2026, "Fintech 2025 Performance Review – Riding the Momentum, Diverging Forward"; ④ GF Securities, May 17, 2026, "This is a Contest Between the Speed of EPS Upward Revisions and Interest Rate Increases". Risk Disclosures: The HK Connect Innovative Pharma ETF Huabao and its feeder funds passively track the Hang Seng Stock Connect Hong Kong Innovative Pharma Select Index (Base Date: Dec 31, 2020; Launch Date: Jul 17, 2023). The Pharma ETF and its feeder funds passively track the CSI制药 Index (Base Date: Dec 30, 2011; Launch Date: Jul 15, 2013). The Fintech ETF Huabao and its feeder funds passively track the CSI Fintech Theme Index (Base Date: Jun 30, 2014; Launch Date: Jun 22, 2017). The Dual-Innovation 50 ETF Huabao and its feeder funds passively track the S&P China A-Share ChiNext & STAR 50 Index (Base Date: Dec 31, 2019; Launch Date: Jun 1, 2021). Index constituents are adjusted according to their respective methodologies. Past index performance does not predict future results. Individual stocks mentioned are for illustrative purposes only as index constituents and do not constitute recommendations or represent fund management direction. Any information herein is for reference only. Investors are responsible for their own investment decisions. The views, analysis, or forecasts herein do not constitute investment advice. The company is not liable for any direct or indirect losses from using this content. Investors should read the Fund Contract, Prospectus, Fund Product Summary, and other legal documents to understand a fund's risk-return profile and choose products matching their risk tolerance. Past performance does not guarantee future results. The performance of other funds managed by the manager does not guarantee this fund's performance. Based on the manager's assessment, Pharma ETF Huabao (562050) and Fintech ETF Huabao (159851) carry an R3 (Medium Risk) rating, suitable for Balanced (C3) or higher risk-tolerance investors. HK Connect Innovative Pharma ETF Huabao (520880) and Dual-Innovation 50 ETF Huabao (588330) carry an R4 (Medium-High Risk) rating, suitable for investors with a C4 or higher appropriateness rating. Appropriateness matching opinions should be based on销售机构 assessments.销售机构 assess these funds per regulations. Investors should heed the manager's appropriateness opinions.销售机构 opinions may differ and cannot be lower than the manager's assessment. Fund risk-return characteristics in contracts and risk ratings may differ due to different考虑因素. Investors should understand fund risks and returns,结合 their investment goals, horizon, experience, and risk tolerance to choose funds and bear risks themselves. CSRC registration does not guarantee a fund's investment value, prospects, or returns. Fund investment involves risks.
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