As the market prepares to open, let's review the significant events over the weekend and examine the latest analyses from major securities firms. The most substantial positive development this weekend came from significant progress in U.S.-Iran negotiations, with encouraging updates emerging continuously. Weekend Highlights: 1. Major Positive Development! Latest Progress in U.S.-Iran Negotiations The former U.S. President indicated that a broader agreement between the United States and Iran is "largely settled," and the Strait of Hormuz will also reopen. This signals that the months-long conflict may be progressing toward an end. The U.S. Secretary of State stated that more news regarding Iran might emerge later today, noting that negotiations have achieved "significant progress." He reiterated that the U.S. goal is to ensure Iran "can never possess nuclear weapons" and emphasized that Tehran's threats to vessels in the Strait of Hormuz are illegal. An Iranian Foreign Ministry spokesperson said that over the past week, the positions of both sides have been "converging," and what will happen in the next three to four days remains to be seen. The spokesperson added that any mechanism involving the Strait of Hormuz should be jointly agreed upon by Iran, Oman, and the coastal states of the strait, and the United States is "not relevant." The Iranian President stated that no decision in Iran would be made without the Supreme Leader's approval or outside the framework of the Supreme National Security Council. This council is the highest decision-making body for defense and national security as stipulated by Iran's constitution. The President also told the state broadcaster IRIB that Iran "is willing to assure the world that we are not seeking nuclear weapons." The Iranian state-affiliated news agency Tasnim reported on Sunday that, as part of negotiations to end the war, Iran has not agreed to any new measures related to its nuclear program. The agency also stated that the Strait of Hormuz "will not return to its pre-war state." Following this news, crude oil plummeted nearly 8% in after-hours trading over the weekend.
2. Crackdown on Illegal Cross-Border Securities, Futures, and Fund Activities; Eight Departments Including the CSRC Jointly Take Action Recently, with the approval of the State Council, eight departments including the China Securities Regulatory Commission jointly issued the "Implementation Plan for the Comprehensive Rectification of Illegal Cross-Border Securities, Futures, and Fund Business Activities." The plan proposes a strict prohibition on overseas institutions providing account opening and trading services within China in any form, sets a two-year concentrated rectification period to clear illegal existing business, and resolutely expels such illegal cross-border activities from the domestic market. 3. Hong Kong SFC: Enhanced Measures to Address Risks of Forged Documents and Money Laundering, and Higher Account Opening Standards On May 22, the Hong Kong Securities and Futures Commission issued a circular outlining the monitoring measures that should be implemented when opening accounts and maintaining client relationships. It expressed deep concern over the potential misuse of client accounts for suspicious or illicit transactions and the associated increased risks of money laundering and terrorist financing. The SFC requires all licensed corporations to conduct internal checks as soon as practicable to detect whether any suspicious or forged documents have been accepted for account opening. 4. Warsh Sworn in as Federal Reserve Chair Kevin Warsh was sworn in as the new Chair of the U.S. Federal Reserve in Washington on the 22nd local time. 5. DeepSeek Announces Permanent Price Reduction DeepSeek officially announced that the API price for the DeepSeek-V4-Pro model will be formally adjusted to one-quarter of the original price after the 25% discount promotion ends on May 31, 2026. This API promotion, originally set to revert to full price starting in June, was confirmed in the latest announcement: the DeepSeek-V4-Pro API will be permanently reduced to one-quarter of the original price (equivalent to a 25% discount). Specifically: 0.025 yuan per million tokens for input (cache hit), 3 yuan for input (cache miss), and 6 yuan for output. 6. 7 Semiconductor Star Stocks Plan to Be Reduced by 127 Billion Yuan Amid the ongoing fervor in the A-share semiconductor sector, shareholders of several prominent companies have collectively announced reduction plans. On the evening of May 22, seven semiconductor and AI industry chain listed companies, including Advanced Micro-Fabrication Equipment Inc. (AMEC), Montage Technology, and ASR Microelectronics, intensively released reduction announcements involving multiple levels such as actual controllers, core shareholders, and directors/supervisors/senior management. In this "reduction wave," inquiry transfer has become an important method, with Montage Technology, CanSemi Technology, and JSG choosing this path for reduction. Based on the latest closing prices, the total planned reduction scale for these seven companies amounts to approximately 126.92 billion yuan. Among them, AMEC alone accounts for a reduction of about 60 billion yuan, while Alibaba has once again moved to reduce its stake in ASR Microelectronics after a six-month interval. Latest Analyses from Major Securities Firms 1. CITIC Securities: Strait Navigation Nears, Awaiting Demand Replenishment The U.S. and Iran are increasingly close to reaching an agreement, and the market has largely priced this in as the baseline scenario. The most significant change after an agreement is reached would be the simultaneous replenishment of supply and demand and a rapid warming of economic activity. Some current economic indicators are noticeably weak, reflecting deferred demand ahead of the anticipated U.S.-Iran agreement and the reopening of the Strait of Hormuz. Micro-level entities are waiting rather than rushing to replenish inventories or resume operations, which is an abnormal disturbance. As the agreement is reached and the strait resumes navigation, both supply and demand will normalize. Economic activity is expected to show significant improvement after June, and changes in macroeconomic variables will also alter the environmental assumptions for market strategy, leading to a gradual rebalancing of styles. The reduction by large funds is nearing its end, and as macro conditions stabilize, allocation-oriented funds will gradually return, driving a recovery in some undervalued sectors. In terms of allocation, continue to actively reduce volatility and reconstruct the barbell structure of AI + energy/chemicals. 2. CITIC Securities Strategy: How to View the Impact of Rising Overseas Long-Term Bond Yields? Overseas long-term bond yields have surged significantly recently. We believe that, against the backdrop of a strong RMB exchange rate and impressive, continuously rising earnings for U.S. tech stocks, this will not have a pronounced negative impact on A-shares. Domestic economic performance is becoming more differentiated, and funds may continue to "cluster" in AI computing power. A shift in the main style theme has not yet arrived. Key focuses: AI (semiconductors, optical communication, electronic cloth, servers, etc.), non-ferrous metals (copper, aluminum, etc.), new energy (lithium batteries, sodium batteries, wind power, nuclear power, power grids). Thematic attention: memory chip chain (mapping of "two memory" listings), glass substrates, MLCC, stock trading software, etc. 3. Guojin Securities Strategy: Two Gates, One Resonance Currently, on one side, the continued closure of the strait has impacted fragile global industries and is now, through monetary policy and political factors (cost-of-living pressures under the U.S. K-shaped divergence), affecting the most resilient sectors. On the other side, the most vibrant industries are spreading their prosperity to traditional sectors. When the Strait of Hormuz reopens for navigation, the diffusion of prosperity and economic recovery will create the strongest resonance for global pro-cyclical assets and physical assets, potentially heralding a new round of HALO trading. If the strait remains closed, ultimately leading to changes in monetary policy, it would mark the end of the rebound for global risk assets. 4. Huaan Securities Strategy: Electronics Cooling Imminent, Communications Poised to Take Over In the second stage of a growth industry cycle rally, after the main sector becomes overheated in trading, a cooling adjustment is inevitable. Therefore, turnover rate can serve as an important and effective leading indicator. ① When the turnover rate approaches the previous high of the current rally, the main sector is highly likely to experience an adjustment of 5–10% in magnitude, lasting 6–10 days. ② If the turnover rate reaches a new high for the current rally, the main sector is highly likely to experience an adjustment of 15–25% in magnitude, lasting 0.5–1 month. ③ The main sector will begin its adjustment either simultaneously with or within one week of the turnover rate peak. Comparing historical patterns with the present: ① As of May 22, the turnover rate for the main electronics sector has hit a new high in the current rally, facing significant adjustment pressure. An adjustment exceeding 15% and lasting more than a month is expected. ② The turnover rate for the main communications sector recently touched its previous high on May 11, followed by continuous cooling and a simultaneous sector adjustment. As of May 22, it has declined considerably but has not yet reached the previous low of this rally. Therefore, slight pressure is expected in the short term, but overall it is limited. We anticipate the communications sector could stabilize and resume its rise as early as next week, becoming the optimal choice to take over from the electronics rally. 5. Shenwan Hongyuan Strategy: Considering the Conditions for the End of a Major Wave Rally Considering the conditions for the end of a major wave rally: 1. The positive cycle of incremental funds becomes unsustainable (A-shares 2015). 2. The industrial trend is disproven (A-shares 2021). 3. The macroeconomic environment deteriorates significantly in a wave-like manner (NASDAQ 1998, A-shares 2018). Currently, there is essentially no room for further tightening of regulations on industry ETFs. Incremental funds based on the asset shortage among residents (insurance, fixed income+, quant) have not yet fully entered a positive cycle. The upward cycle of the industrial trend continues. The macroeconomic environment presents disturbances but not trend-changing shifts. The major wave rally is not over; it is gathering strength for a new advance. 6. BOC Strategy: Main Theme Resilience Remains, Style Rotation Internalized From an allocation perspective, diffusion within AI does not signify the end of the original main theme but rather resembles a structural upgrade. Cloud-side computing power determines the height of the AI industry, device-side AI determines its breadth, and physical AI determines the boundary of AI evolving from "thinking" to "acting." The current market still has allocation demand for the computing power main theme, but at the local trading level, it has begun searching for new directions with better cost-performance, fresher catalysts, and lower crowding. If device-side AI continues to see product-level validation, and if robotics and embodied intelligence continue to receive policy or industry catalysts, then these two branches are likely to become key focal points for the next phase of tech style rotation. 7. Soochow Securities Strategy: Rising U.S. and Japanese Bond Yields; What Impact on A-Shares? The impact of Japanese bonds on A-shares is limited. The core focus should be on the impact of oil price fluctuations on U.S. bond yields. If U.S. bond yields rise further subsequently, then current A-share allocation should consider two directions: First, dividends. If real interest rates rise, assets with stable cash flows become advantageous, and dividends can be appropriately increased. Second, the AI industry direction, which benefits from the AI industrial trend on one hand and is also a main force in current balance sheet expansion on the other. 8. Huaxi Securities Strategy: Support at the Bottom, Respect at the Top Since mid-May, the resistance faced by A-shares mainly comes from two aspects: overseas liquidity pressures and the persistently crowded microstructure of the tech sector. Although non-tech sectors have attempted multiple times to attract funds, constrained by the fundamental reality of weak domestic demand, they have consistently failed to become the direction of concerted fund flows. We believe the current adjustment is a phase of consolidation within a strong structural rally. Coupled with regulatory authorities' continuous advancement of risk prevention and strengthened supervision efforts, it helps digest overheated sentiment and lays a solid foundation for subsequent healthy and sustainable upward movement. Examining from the three dimensions of micro-liquidity, global industrial trends, and policy stabilization expectations, the market's bottom range possesses solid support. 9. Industrial Securities Strategy: Comparing with the Dot-com Bubble; Where is the Current Global AI Rally? History does not simply repeat itself, but there are often similarities worth referencing. We compared the Nasdaq's trajectory after the release of ChatGPT in late 2022 with that after the release of Netscape in late 1994. It can be seen that compared to the dot-com bubble, the current global AI rally shares many similarities in terms of涨幅, slope, and rhythm. By comparison, the current AI rally corresponds to the June 1998 stage of the dot-com bubble in terms of time (66% of the process) and has achieved a 24% gain in terms of space. Reviewing the evolution of the dot-com bubble, the rally process also witnessed numerous concerns similar to those today, including Alan Greenspan's warning of "irrational exuberance" in late 1996, reminding the market of overheating, and the Fed's initiation of a tightening cycle after the Kosovo War in 1999 pushed up oil prices and inflation. However, these concerns regarding liquidity and sentiment only caused short-term disturbances to the rally and did not lead to the termination of a major industrial trend rally. Even during the period of consecutive Fed rate hikes, it was actually the phase with the steepest rally slope and the most frenzied industrial investment sentiment, leaving a significant "tail-end rally." The core reason behind this was that the industrial prosperity trend could still be validated. Ultimately, the bursting of the dot-com bubble in March–April 2000 was essentially a confirmation that industrial prosperity was难以维持 after new financial reports verified that leading companies' performance fell short of expectations. 10. GF Securities Strategy: What are the Market Patterns Around Giant IPOs? From the perspective of the A-share market, after the listing of a giant IPO, its impact on the broader market is limited. Adjustment pressure during bull markets is far less than during bear markets, with only a slight reflection within 1 week. The underlying reason may be that during bull markets, incremental funds are more abundant, and the market's resistance to IPO "capital drainage" is stronger. U.S. market experience also shows that an impact is not inevitable; instead, it may boost the热度 of the corresponding sector. The market often worries that after a giant IPO lists, funds will withdraw from similar companies and flow into the new stock, the so-called "siphoning effect" within the sector. This phenomenon does exist in the A-share market in the short term. However, over a longer time horizon, both domestic and foreign stock markets show that industrial trends determine the evolution of sector styles, not single IPO events. New players and old players' performance becomes positively correlated again, rather than a zero-sum game for existing funds.
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