The A-share market performed strongly today, with the Shanghai Composite Index surpassing 4,200 points and the ChiNext Index surging above 3,900 points, reaching its highest level since June 16, 2015. The STAR 50 Index also hit a new intraday record. Trading volume in the Shanghai and Shenzhen markets reached 3.54 trillion yuan, marking the fourth-highest level this year and exceeding 3 trillion yuan for four consecutive trading sessions. In contrast, the Hong Kong market lagged, rising only 0.05%.
The Ministry of Foreign Affairs spokesperson confirmed that U.S. President Donald Trump will pay a state visit to China from May 13 to 15. This announcement has solidified expectations, with some funds beginning to speculate on related themes. For instance, cross-border e-commerce concept stock Jinhong Holdings (02603) rose over 5%. Innovative pharmaceutical stocks such as Junshi Biosciences (01877) and Asymchem (06821) also gained more than 5%.
Tensions between the U.S. and Iran persist. Iran issued a response on Sunday, emphasizing the need to end the war on all fronts, particularly in Lebanon, and ensure the security of shipping in the Strait of Hormuz. Within hours, Trump dismissed the proposal via social media. With neither side showing willingness to compromise, the stalemate is likely to continue.
Goldman Sachs recently released its latest Asian equity strategy report, explicitly advocating an "overweight" position in China and raising its 12-month target for the CSI 300 Index to 5,300 points. In comparison, U.S. stocks have risen significantly, increasing the likelihood of a correction, while Chinese stocks are in a recovery phase. As long as the market remains strong, capital inflows are expected. However, Hong Kong stocks have underperformed in this rally, primarily because large-cap stocks have not fully benefited, while many of the stronger performers are not included in major indices.
The AI sector has entered a frenzied phase, with overseas giants continuing to increase capital expenditures. Domestic companies are also actively following suit. ByteDance has raised its 2026 AI infrastructure capital expenditure by 25% to 200 billion yuan. Other major companies are expected to follow with substantial investments. Attention is on Alibaba (09988) and Tencent (00700), both scheduled to release their first-quarter earnings on May 13, to see if their capital expenditures exceed expectations.
Hong Kong-listed stocks in related sectors, such as chips, optical modules, IDC, servers, and liquid cooling, are benefiting. Traditional chip foundry leader SMIC (00981) rose over 4%, while analog chips performed even stronger, driven by price increases from Texas Instruments. Naxin Micro (02676), which is expanding its automotive semiconductor layout, officially launched the isolated gate driver chip SI6911F. This new product meets the highest automotive functional safety standard, ASIL D, in terms of driving performance, anti-interference capability, and safety architecture. The isolated gate driver chip market has long been dominated by overseas companies, and this development could help break external technological monopolies and promote domestic substitution. Naxin Micro surged over 15% today. Montage Technology (06809) rose over 11%, while chip designer GigaDevice (03986) gained more than 7%.
In the optical module sector, Kingboard Holdings (00488) rose nearly 8%. On the server front, Lenovo Group (00992) gained close to 7%. The materials segment also remained strong. Silicon carbide, with its wide bandgap, high breakdown electric field, and high thermal conductivity, is highly sought after by AI giants. For example, NVIDIA's (NVDA.US) Rubin series GPUs have seen power consumption jump to over 1,000W, pushing traditional silicon-based solutions to their physical limits. To reduce transmission losses, AI data centers are accelerating the transition from 240V/480V architectures to 800V high-voltage direct current (HVDC) architectures. Silicon carbide devices have become the optimal choice for this architecture. In 2025, Tianyue Advanced (02631) held a 27.6% share of the global conductive silicon carbide substrate market, ranking first worldwide, with a 51.3% share in the 8-inch market segment. Today, Tianyue Advanced surged over 25%.
The PCB sector has also been emphasized repeatedly. Shenghong Technology (02476), a top May stock pick, currently has ample orders, with production and delivery proceeding normally. Its Huizhou factory maintains high capacity utilization and is advancing expansion plans, steadily progressing toward its 2030 goal of achieving trillion-yuan output. The company's core advantage lies in maintaining technological, customer, and capacity advantages amid the continuous iteration of GPUs, ASICs, TPUs, and AI switches. Today, it surged over 13%. Other lagging stocks, such as Kingboard Holdings (00488), rose nearly 8%.
The real estate sector continues to strengthen, driven by improving fundamentals. Data from the Shanghai Real Estate Trading Center's "Online Real Estate" platform showed that on May 10 (Sunday), Shanghai recorded 1,664 online transactions for second-hand homes (including commercial properties), setting a new five-year daily transaction record after a month. Nationwide, the area of commercial housing awaiting sale declined year-on-year for the first time in 51 months, with a notable reduction in new inventory under three years and significant commercial inventory digestion. As inventory in core cities bottoms out, signals of price stabilization are expected to gradually spread nationwide, shifting the industry from "oversupply" to "supply-demand balance."
The current round of property market policies focuses on enhancing provident fund support. Provident fund loan limits in core cities nationwide have generally increased by 15% to 50%, with first- and second-tier cities covering over 50% of total loans, and some cities exceeding 100%. Leading stocks such as China Resources Land (01109) rose over 4%, along with China Jinmao (00817), YUEXIU PROPERTY (00123), and China Overseas Land & Investment (00688). Smaller-cap stocks with low trading volumes are less noteworthy.
Corresponding engineering machinery sectors are also raising prices. SANY HEAVY IND (06031)'s subsidiary, SANY Heavy Machinery, issued a notice on May 1, announcing a 5% price increase for excavators effective May 15. XCMG Machinery's (000425.SZ) wholly-owned subsidiary, Xuzhou XCMG Excavator Machinery Co., Ltd., issued a similar notice on May 8, announcing a 3% to 5% price increase for different product models effective June 1. The concentrated price hikes by three major industry leaders have disrupted the long-standing price competition landscape. SANY HEAVY IND (06031) and Zoomlion (01157) rose over 7%, while China Longgong (03339) gained more than 3%.
Recently, the National Energy Administration, in collaboration with the National Development and Reform Commission, the Ministry of Industry and Information Technology, and the National Data Administration, issued the "Action Plan for Promoting Mutual Empowerment Between Artificial Intelligence and Energy." The plan emphasizes continuously increasing the proportion of green electricity in computing facilities, requiring new data centers in core node regions of national hub nodes to have a green electricity share exceeding 80%. Datang Power (00991) is the only benchmark for the "nation's first large-scale computing-power synergy" project, with the 500,000-kilowatt photovoltaic direct supply project in Zhongwei, Ningxia, commencing operations on May 2. As a result, its stock surged over 11%. Other power stocks, particularly those in thermal power, performed strongly.
The luxury cruise ship Hondius, operated by Dutch company Oceanwide Expeditions, has reported an outbreak of hantavirus, resulting in three passenger deaths and attracting international attention. Further developments are being closely monitored.
On May 11, French Health Minister Stéphanie Riste confirmed the first case of hantavirus infection in France, involving a French woman who had traveled on the Hondius cruise ship. The patient was repatriated to France via a special flight from the Canary Islands on May 10. Riste stated that the patient tested positive for hantavirus and her condition deteriorated that evening. If more cases emerge, widespread concern may follow. Key stocks to watch include Aimei Vaccine (06660), Shandong Xinhua Pharmaceutical (00719), and Junshi Biosciences (01877).
CHINA RES BEER (00291): The company reported a revenue decline of 1.7% year-on-year to 37.99 billion yuan in 2025, with net profit attributable to shareholders falling 28.9% to 3.37 billion yuan. Excluding factors such as goodwill impairment, factory closures, and land sales, adjusted EBITDA increased 9.9% year-on-year to 9.879 billion yuan, while adjusted net profit attributable to shareholders rose 19.6% to 5.724 billion yuan.
CHINA RES BEER holds the top position in domestic beer sales, with a market share of approximately 30%, maintaining the highest production and sales volume in China for 18 consecutive years. Snow Beer is the world's best-selling beer brand. The company achieved growth against the trend, with beer sales reaching 11.03 million kiloliters in 2025, up 1.4%, outperforming the industry's decline of 1.1%. The adjusted EBITDA margin for the beer business increased by 3.9 percentage points year-on-year to 26.3%, while adjusted beer EBITDA rose 17.4% to 9.61 billion yuan. Profitability continued to improve, with a gross margin of 42.5%, marking five consecutive years of growth. ROE exceeded 15%, reflecting strong cash flow generation.
Core strengths: 1) Low costs and extensive coverage: Annual production capacity is approximately 19 million kiloliters, with 62 factories nationwide and over 2 million retail outlets, resulting in significantly lower unit costs compared to Tsingtao Beer and Budweiser. 2) Comprehensive coverage from mass-market to premium segments: Mass-market: Snow Light and Brave the World (national bestsellers). Mid-to-high-end: Mars Green, Craftsmanship Brew, and Old Snow (sales increased 60% in 2025). Premium: Ken Fourteen (domestic malt craft beer). International: Heineken portfolio (acquired China operations in 2018). The company has deep partnerships with restaurants, convenience stores, supermarkets, nightclubs, and e-commerce platforms. Instant retail orders on Meituan and Ele.me increased by 50%, while e-commerce sales (Tmall and JD.com) grew 40%. The餐饮渠道 (hot pot, barbecue, nightclubs) has fully recovered, with Heineken nightclub orders up 25%. The company is in a comprehensive harvest period for premiumization, with mid-to-high-end and above products accounting for nearly 25% of sales. Sales of普高档及以上 products increased 10%. The nostalgic appeal of Old Snow has revived, while Red Stripe, a mid-to-high-end hit, doubled in sales. Heineken grew 20% despite a high base, supported by global IPs such as the UEFA Champions League and Formula 1, accelerating premiumization. The啤白协同 strategy, focusing on a second growth curve, includes the acquisition of a 55.19% stake in Guizhou Jinsha Distillery, positioning the company in the high-end酱香白酒 market. Nationwide, distributors report strong orders, with high-end products (Heineken, Red Stripe, Old Snow) in short supply and some regions experiencing stockouts. The啤酒主业 continues to advance steadily in premiumization, with core high-end products like Heineken maintaining strong growth. Digitalization efforts to reduce costs and improve efficiency are yielding ongoing benefits, steadily enhancing core profitability.
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