Investors who watched the film "Bull Is Coming" are hoping for a real rally in A-shares. Today, the market delivered exactly that.
On August 17, all three major A-share indices rose collectively, with net capital inflows from major players exceeding 601 billion yuan. By the close, the Shanghai Composite Index gained 1.41%, the Shenzhen Component Index rose 2.44%, the ChiNext Index jumped 3.14%, the Beijing Stock Exchange 50 Index added 1.91%, and the STAR 50 Index climbed 4.14%. Total market turnover reached 2.4025 trillion yuan, up 245.9 billion yuan from the previous session, with over 4,300 stocks advancing.
Sectors such as electronic chemicals, cultivated diamonds, semiconductors, memory chips, precious metals, and corn led the gains, while baijiu, gaming, film and television, and pharmaceutical distribution lagged.
Semiconductor Sector Shows Strength
Today, the semiconductor sector displayed notable strength. The CPO (Co-packaged Optics) segment expanded its gains in the afternoon, with multiple stocks hitting their daily limit ups. According to data from the World Semiconductor Trade Statistics (WSTS) organization, the global semiconductor market reached a size of $702 billion in the first half of 2026, a year-on-year increase of 102%. In the second quarter, global semiconductor sales hit $403.3 billion, a sequential growth of 35.1%, setting a new quarterly record. Based on the strong first-half performance, WSTS has revised its full-year market size forecast upward to $1.655 trillion, an increase of 108%, which is 18 percentage points higher than its spring projection. For 2027, the market is expected to reach $2.1 trillion, representing 29% growth.
Guolian Minsheng Securities stated that Lumentum and Coherent continue to see strong earnings growth, with 800G demand remaining robust. The 1.6T phase is entering an accelerated ramp-up, while new interconnection solutions like OCS, NPO, and CPO are gradually contributing incremental gains. NVIDIA's Spectrum-X Ethernet silicon photonic switches have entered full-scale production, and Feynman is evolving towards higher-bandwidth interconnection architectures. The expansion of AI cluster scales is expected to continuously boost demand for optical modules, lasers, and silicon photonic devices. Overseas demand for AI clouds remains strong, with orders, pricing, and project recovery cycles from CoreWeave and Nebius further validating the resilience of computing demand and the commercial returns of AI infrastructure. Continued capacity expansion by overseas cloud providers is likely to drive demand for high-speed interconnections.
China Merchants Securities believes that the supply-demand gap in the storage industry will persist until 2027, putting domestic module companies in a phase of profit expansion. The global CPU market space has significantly increased, with domestic computing power orders and revenue growing rapidly, simultaneously driving demand for advanced domestic manufacturing processes. The trend of domestic storage capacity expansion is clear, with the localization rate set to rise. Equipment orders remain strong, and materials will see scale benefits after breaking through capacity bottlenecks.
Autumn Rally Potential
Guotai Haitong indicates that the Chinese stock market will gradually usher in an "autumn rally." With declining risk-free interest rates, capital market system reforms, and economic structural transformation, the Chinese market has strong underlying support. The historical process of a "transformational bull" will not end here.
Zheshang Securities believes that the current rebound is likely not over and that the market still has room for further development. The Shanghai Composite Index encountering resistance at the 250-day moving average aligned with previous expectations. After a brief consolidation, it still has the potential to challenge the 4,000-point mark or even higher.
China Merchants Securities suggests that the risk appetite recovery and systemic market repair driven by the resonance of macro and micro liquidity improvements since August may be nearing its end. With the concentrated window for mid-year report disclosures approaching, the market will increasingly focus on structural opportunities linked to earnings performance.
Industrial Securities notes that, unlike the previous "one stock shining alone" scenario for AI, the breadth of this round of market recovery has significantly expanded, which is the biggest difference sensed by the market recently. The current rally is not a "one-stock show." During the recent upward movement, sector rotation intensity remains high for the year, indicating that the market is rotating and spreading across various sectors to find opportunities.
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