The post-Dragon Boat Festival performance of the A-share market was exceptionally strong, with the Shanghai Composite Index surging over 72 points. In contrast, the Hong Kong market was relatively subdued, closing down 0.65%.
Negotiators from the US and Iran have reached an agreement on a roadmap for a final deal, establishing a dedicated communication channel aimed at preventing unexpected incidents and misjudgments, and ensuring the safe passage of commercial vessels through the Strait of Hormuz. This has provided a positive catalyst for tanker stocks, with spot freight rates on major routes surging significantly. The Middle East TD3C route jumped to nearly $500,000 per day, Yanbu also achieved transactions of $230,000 per day, the US Gulf rose nearly 30% to $150,000 per day, and West Africa surged over 80% to $170,000 per day. Early Monday morning (June 22), three US-sanctioned supertankers, Elva, Virgo, and Vigor, carrying approximately 6 million barrels of Iranian crude oil, entered the Strait of Hormuz, pushing Iran's overt crude shipments through the strait to their highest level since the war began. China COSCO Shipping Energy Transportation Co Ltd (01138) rose nearly 7%.
The Lujiazui Financial Forum released relevant policy signals. While detailed rules for AI implementation have not been formally issued, large models have been matched with the fifth set of listing standards. Elon Musk predicts that domestic large models will catch up with Fable by Q1 2027. Tang Jie from Zhipu AI stated the catch-up speed is even faster. Zhipu AI (02513) surged over 15%. Iluvatar CoreX (09903), which has procurement rumors, rose over 15% again. The GPGPU concept stock Biren Technology (06082), which matches domestic large models, gained over 4%. All these were stocks mentioned in last Thursday's sector focus. Additionally, Cambridge Industries Holding Limited (06166), highlighted in the individual stock picks, surged over 13%.
A historic shift has occurred in South Korea's chip industry landscape. SK Hynix's stock price rose sharply on Monday, with its market capitalization surpassing Samsung Electronics to become South Korea's most valuable listed company, breaking Samsung's long-standing dominance. The main reason is the strong demand for High Bandwidth Memory (HBM) chips. According to predictions from a storage industry expert conference call: storage prices in Q3 2026 are expected to rise 40% to 50% sequentially, and are forecast to rise another 30% to 40% sequentially in Q4 2026. This price increase forecast is significantly higher than current market consensus, which only expects a 15% to 20% sequential increase in Q3 and less than 30% in Q4. Currently, long-term storage supply agreements are only signed with hyperscale cloud service providers, locking in 50% of the industry's capacity, with the potential for this proportion to rise to 70%. The genuine storage leader in Hong Kong, GigaDevice Semiconductor (Beijing) Inc (03986), surged over 11% again.
Semiconductor Manufacturing International Corporation (00981): The implementation of the "Tao's Law" brings a clearer expansion of market space. Several high-value bonding processes for chip and circuit folding will be undertaken by the Fab. Regarding stacking layers, GPUs are expected to stack 6-8 layers. While single die size may decrease relatively, overall wafer demand could still see a several-fold increase compared to before. Kirin and Kunpeng will also stack 2-3 layers. For mature process nodes, the demand and price increase sustainability: over the next few years, orders shifting from overseas could bring a total demand of about 150,000 wafers per month. SMIC itself also has about a 15% exposure to AI-supporting mature-node chips, corresponding to an incremental demand of 20,000 to 30,000 wafers per year in the future. Based on current capacity expansion plans, a supply gap is expected to persist at least until 2028. Regarding prices, they have already risen 10% this year, with negotiations continuing in the second half, and an expected further 10% increase next year.
After the market close last Thursday, Fujikura raised its performance guidance: for FY27 (April 1, 2026, to March 31, 2027), it raised its net profit attributable to parent company shareholders from 156 billion yen to 229 billion yen, an upward revision of up to 46.8%. This revision directly reignited expectations for optical fiber, and another round of price increases is also anticipated. Yangtze Optical Fibre and Cable Joint Stock Limited Company (06869) surged over 31%.
Intel CEO Pat Gelsinger stated he is shifting investment focus towards advanced packaging technologies like EMIB, glass substrates, and new materials such as Gallium Nitride (GaN), Silicon Carbide (SiC), Indium Phosphide (InP), and synthetic diamonds. Directions that industry giants focus on are where capital chases. For instance, the GaN leader Innoscience (02577) surged over 10%, and the SiC leader Shanghai Tianyue Advanced Materials Co Ltd (02631) also rose over 10%.
The materials sector has been very hot recently. On June 17, MULinsen issued another notice: increasing prices for all PCB products by an additional 10% on top of previous hikes. Kingboard Holdings Limited (00148) rose over 11% again. Sales of some standard products from Japan will cease from July 1, and China's exports of the rare metal tungsten to Japan have dropped to zero. The tungsten industry leader Jiaxin International Resources (03858) surged over 22%. According to a circulated meeting summary from Dongjiang Environmental Company Limited (002672) dated June 16, bismuth telluride is comparable to tungsten hexafluoride. Modern industry often uses vacuum melting. By mixing bismuth, antimony, and tellurium in specific mass fractions and melting them in a vacuum device, a higher-performance BiSbTe metal compound is prepared. The company produces nearly 30,000 tons of various metal products annually, with the quality of refined bismuth, refined tellurium, and antimony oxide leading the industry. Additionally, the company, in collaboration with relevant research institutes, is advancing a green recycling and comprehensive resource utilization project for power batteries, entering the new track of power battery recycling. It rose over 33% today.
Key Drivers for the Brokerage Surge
Brokerages surged today, triggered by a new rumor: the STAR Market requires sponsoring brokerages to use their own capital for follow-on investments (2%-5%). Tech stocks rise upon listing, allowing brokerages to profit alongside. In just the two months from April to June, brokerages' floating profits from follow-on investments increased by over 5 billion yuan, with top brokerages alone earning tens of billions. Combined with sponsorship fees and direct investments, this equates to earning from three sources. The reason for the long-term stagnation of brokerages was suppression by large funds. This time, there is a clear unwinding of individual stock holdings. Looking horizontally, in the global tech bull market, only A-share brokerages have underperformed, while those in the US, Japan, and South Korea have all outperformed their indices, with some South Korean brokerages rising 6-fold while the index doubled. Currently, buying brokerages is roughly equivalent to buying a discounted version of tech. Once the fund suppression is lifted, if tech surges, brokerages will follow. This logic indeed holds water, making a revaluation of brokerages reasonable. The investment advisory concept stock JF SMARTINVEST (09636) surged over 13%. GF SEC (01776), CSC (06066), CICC (03908), CITIC SEC (06030), etc., all rose over 6%.
During the EU leaders' summit from June 18-19, the President of the European Commission and others called for upgrading the EU's "trade defense tools" and taking action against China. However, due to significant internal divisions within the EU, related trade actions were ultimately postponed. Since the European Commission issued a public statement on trade policy towards China on May 29, the energy storage and inverter sectors have been under overall pressure due to this. The phase of maximum negative news has passed, further proving the irreplaceability of the Chinese supply chain. The leader Contemporary Amperex Technology Co., Limited (03750) rose nearly 5%, and Lopal Tech Co., Ltd (02465) surged over 9%.
Insilico Medicine (03696) announced it has entered into a research collaboration with SK biopharmaceuticals to discover AI-driven innovative drug candidates for neuroimmune diseases of the central nervous system. According to the agreement terms, Insilico Medicine will be eligible to receive up to $18 million in upfront and near-term milestone payments. The potential total deal value exceeds $2.5 billion, covering development, regulatory, and commercial milestone payments, as well as single-digit percentage sales royalties based on net sales after product commercialization. It rose over 4% today.
Sector Spotlight
Boosted by news of the US-Iran agreement document, international gold prices surged in early Asian trading today, briefly surpassing $4,220 per ounce. On June 22, Morgan Stanley stated that without a significant recovery in ETF fund inflows, its bullish target for gold to reach $5,200 in the second half of the year would become more difficult to achieve. Morgan Stanley remains optimistic about the long-term prospects for gold, as easing Middle East tensions and falling oil prices help alleviate inflation concerns. However, the Fed's hawkish tone in its recent meeting reinforced expectations that interest rates will remain higher for longer, increasing the opportunity cost of holding non-yielding assets like gold. Key Hong Kong-listed gold stocks include: Zijin Mining Group Co., Ltd. (02899), Chifeng Jilong Gold Mining Co., Ltd. (06693), Shandong Gold Mining Co., Ltd. (01787), and Zhaojin Mining Industry Co., Ltd. (01818).
Individual Stock Analysis
CHINFMINING (01258): Resource Reserves Continue to Expand; Q1 Net Profit Hits Record High for the Period. The company's Q1 net profit attributable to parent company shareholders surged 63% year-on-year, reaching a record high for the period. Self-owned mine-produced copper contributed 59.1% of profits, with cathode copper gross margin reaching 47.8%. Overall gross margin improved from 27.5% to 31.1%. The company aims to exceed 300,000 tons/year of self-owned mine copper production by the end of the "15th Five-Year Plan".
Analysis: The company is the only Chinese-funded enterprise with a complete overseas integrated copper pyrometallurgical + hydrometallurgical smelting operation. The Chambishi mine in Zambia forms a closed loop of "mining - beneficiation - hydrometallurgy - pyrometallurgy - sales". The first overseas digital mine and the first pyrometallurgical copper smelter are both company assets. The company fully benefits from global energy transition demand, with ample existing projects under construction/in reserve, concentrated for commissioning between 2027-2030; the Benkara copper mine in Kazakhstan opens up incremental growth in Central Asia. It expands through external M&A for reserve projects, with dual core African bases in Zambia + DRC, adding the Benkara copper mine in Kazakhstan, Central Asia, in 2025, totaling 10 operating mines globally. JORC-standard copper metal resources are 7.1826 million tons, cobalt 198,000 tons. The average copper grade of self-owned mines is 1.7%-2.3%, compared to the global average of only 0.53%, resulting in significantly lower mining costs than the industry average. Capacity continues to rise steadily. The company's self-owned mine copper production is 143,100 tons in 2025, with guidance for 155,000 tons in 2026. The target for self-owned copper capacity by 2030 is 300,000 tons, nearly doubling. It plans to process 14 million tons of ore annually, producing 45,000 tons of copper concentrate, with commissioning in 2029. Sulfuric acid: 900,000 tons; liquid sulfur dioxide: 100,000 tons; cobalt hydroxide containing cobalt: 600 tons (cobalt temporarily reduced due to maintenance at DRC mine). Projects in hand and capacity plans: 1) The new mine at CNMC Luanshya adds a total of 55,000 tons/year of copper concentrate; the shallow part commences in 2027 (+12,000 tons), the deep part in mid-2029 (+43,000 tons). 2) Resumption of the MSESA ore body at Kambove, adding 15,000 tons/year of copper concentrate, commissioning by end-2027, simultaneously increasing cobalt salt production. 3) The Samba copper mine at Chambishi hydrometallurgical plant, processing 1.5 million tons of raw ore annually, adding 20,000 tons/year of copper, commissioning in 2029, providing stable raw materials for hydrometallurgical smelting. 4) Phase II of the Chambishi Southeast Ore Body plans to add 46,000 tons/year of copper, under preliminary论证, a core medium-to-long-term增量. 5) The Deziwa copper mine (core operating asset in DRC) is operating stably, producing 80,000 tons/year of cathode copper and 8,000 tons/year of cobalt, the company's second-largest copper-cobalt production base. The company has ample existing projects under construction/in reserve, concentrated for commissioning between 2027-2030. The Benkara copper mine in Kazakhstan opens up incremental growth in Central Asia, breaking reliance on a single African region, and resource reserves continue to expand.
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