On December 22, China's major stock indices surged in the morning session with increased trading volume. By midday, the Shanghai Composite Index rose 0.64%, firmly reclaiming the 3,900-point level, while the Shenzhen Component Index gained 1.36% and the ChiNext Index jumped 1.80%. The half-day turnover reached 1.1 trillion yuan, up nearly 100 billion yuan from the previous session. Over 3,400 stocks advanced across the two exchanges.
**Sector Highlights:** 1. **Hainan Sector Extends Rally** The Hainan-themed stocks remained strong, with Hainan Strait Shipping, Hainan Development, Kangzhi Pharmaceutical, and China Tourism Group Duty Free among over 20 stocks hitting the 10% daily limit-up. *Catalyst*: The official launch of island-wide customs closure operations for the Hainan Free Trade Port on December 18. According to Sanya's commerce bureau, duty-free sales in the city reached 118 million yuan on the first day, with visitor traffic at Sanya International Duty-Free Shopping Complex surging over 60% YoY.
2. **Smart Driving Concept Gains Momentum** The autonomous driving sector saw repeated activity, with Zhejiang Shibao sealing its fifth consecutive limit-up and Wanji Technology rising over 10%. *Catalyst*: Changan Automobile announced China's first officially licensed L3 autonomous vehicle (plate "渝AD0001Z") in Chongqing on December 20. Ping An Securities noted this marks technological and policy progress for commercializing autonomous driving by 2026.
3. **CPO Sector Rallies** Co-packaged optics stocks strengthened, led by Changxin Borui, while Techfast, Yangtze Optical Fibre (limit-up), Jingwang Electronics, InnoLight, and Eoptolink followed. *Catalyst*: Shanghai Jiao Tong University's breakthrough in next-gen optical computing chips for AI applications. TF Securities highlighted the rapid growth potential of China's photonic chip industry.
4. **Other Notable Moves** - Precious metals hit record highs, with Silvercorp Metals touching limit-up. - Commercial aerospace stocks like China Satellite (10-year high) and Shanghai Harbor surged. - Unmanned driving plays such as Zhejiang Shibao rallied. - Decliners included film stocks like Bona Film Group (limit-down) and AI healthcare concepts.
**Broker Views:** 1. **CSC Financial**: Expects A-shares to synchronize with global markets' upward momentum, citing stabilized U.S. AI stocks and limited impact from BOJ's rate hike. Suggests three investment themes: high-dividend stocks (especially Hong Kong financials), growth sectors (metals, AI infrastructure, new energy), and thematic plays (Hainan duty-free, nuclear power).
2. **CMSC**: Anticipates a combined year-end and spring rally, noting early 2026 policy implementation and institutional buying of broad-based ETFs. Recommends blue chips (CSI 300/SSE 50) and cyclical sectors (industrial metals, non-bank financials, travel).
3. **SDIC Securities**: Cautions that post-4,000-point gains require transition from liquidity-driven to fundamentals-driven growth. Notes elevated valuations (70+ percentile PE for major indices) and constrained year-end upside due to global liquidity uncertainties. Favors export-oriented and undervalued cyclical stocks for H1 2026.
*Note: All stock movements and broker comments reflect midday data as of December 22.*
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