On Tuesday (July 28), A-share optical module and CPO stocks experienced a broad sell-off. Eoptolink Technology Inc., Ltd. plunged over 17%, breaking below the 250-day moving average, while Zhongji Innolight Co., Ltd. fell more than 15%, and Tianfu Communication Co., Ltd. dropped over 13%, retreating to the annual line.
Among popular ETFs, the ChiNext AI ETF (159363), which is heavily weighted in optical module leaders, slumped sharply, closing down 9.43% on the exchange. This marked a new low for the current correction cycle, with net capital inflows of 129 million yuan on the day as investors bought the dip. Influenced by the recent breakdown of US stocks, stock markets in China, Japan, and South Korea have generally experienced significant adjustments.
Regarding the current market situation, Cao Xuchen, fund manager of the ChiNext AI ETF (159363), stated that he maintains his previous judgment. He expects the computing power sector to see a phase-based rally between August and September, although the overall upward potential for the broader market index may narrow. The current market decline is not sufficient to warrant a revision of this core view.
Firstly, the trigger for this round of adjustment is primarily attributed to two pieces of news. One is that Nvidia is reportedly negotiating to provide up to $250 billion in financing guarantees for OpenAI to support the construction of a 10GW supercomputing center in Ohio, coupled with a $350 billion chip procurement financing arrangement. This has raised concerns about Nvidia's debt repayment capacity. The other is that the price negotiation results between SanDisk and Meta fell short of expectations, exacerbating market anxiety about industry cyclicality. These factors jointly led to a decline in the memory sector, dragging down the global technology supply chain.
From a technical perspective, the adjustment of SK Hynix's fifth wave, which was originally expected to complete last Monday, has been delayed due to weak market sentiment. The stock price has now touched support at the 120-day moving average. It was previously suggested that if the fifth wave stopped declining early last week, a mild adjustment with time-for-space could be achieved. However, the actual market movement has chosen a weaker path requiring both time and space for a full adjustment.
Cao Xuchen indicated that he had previously pointed out that the technology sector is currently in a transition phase from a bull to a bear market, the essence of which is a process of gradually converging volatility. Given that the market rally from April to June was relatively sharp, the correction in July has also been significantly larger than average, essentially completing the downward space of the past three months within a single month. Based on this, August and September are theoretically expected to be the most significant quarterly window for repair. Therefore, investors who still hold positions should not easily retreat.
Regarding the key upcoming time points, they are outlined as follows. First, from July 22 to July 30, the four major cloud service providers—Google, Microsoft, Meta, and Amazon—will release their quarterly reports. The key focus will be on the impact of capital expenditure on fundamentals. Second, on August 7, the US July non-farm payroll and unemployment rate data will be released, which will influence the pace of interest rate cuts and liquidity expectations. Third, on August 26, Nvidia's financial report will be disclosed, requiring attention to its Beta acceleration.
Regarding the influence of these three events, Cao Xuchen, fund manager of the ChiNext AI ETF (159363), stated that the first and third events will determine the direction and elasticity of the tech sector, while the second event will affect the overall market rhythm. He holds a relatively optimistic view on the first and third events. As for the second event, it will depend on the related actions of Donald Trump. If Trump pushes for a resolution of the US-Iran issue ahead of schedule, the tech sector rally could start before August 7; otherwise, it is likely to be delayed until after August 7. Therefore, Cao Xuchen stated that the critical juncture for the tech sector is now concentrated in the next two weeks, and investors should remain calm, awaiting substantive verification of fundamental data.
Recent market rumors have been chaotic, such as good pricing in the PCB sector leading to significant gains in related stocks, or disappointing 1.6T optical module prices causing sharp declines in related stocks. Such information represents short-term noise and has limited reference value. The current market behavior of "looking at charts to find reasons" is essentially a manifestation of capital rotation and insufficient liquidity.
In terms of allocation direction, Cao Xuchen believes that the ChiNext AI ETF (159363) focuses on optical modules as its main theme, while the Hong Kong Stock Connect Information Technology ETF (159131) focuses on FAB (fabrication plants). The current tech sector should not be overly sold off. Although rebounds have been repeatedly hit by bearish candles, the trading strategy of chasing extreme lows currently lacks practical significance.
The ChiNext AI ETF (159363) and its off-exchange feeder funds (Class A: 023407, Class C: 023408) focus on CPO optical module leaders. The underlying index features a combined weight of approximately 40% from Zhongji Innolight, Eoptolink Technology, and Tianfu Communication, positioning it as a core flag bearer for AI computing power. As of June 30, 2026, the ChiNext AI ETF (159363) has a latest scale of over 8.1 billion yuan and average daily trading volume exceeding 1 billion yuan in the past six months. Its scale and liquidity lead the eight ETFs tracking the same underlying index.
The Hong Kong Stock Connect Information Technology ETF (159131) is a rare "pure-blooded" hard tech product in Hong Kong, supporting T+0 trading. It is the first of its kind in the market, with the largest scale and strongest liquidity among the same category, and its off-exchange feeder fund code is 026755. The underlying index, the CSI HK Stock Connect Information Technology Index, is composed of "85% hardware + 15% software," heavily weighted in Hong Kong-listed "semiconductor + electronics + computer software" stocks. It excludes large-cap internet companies, making it easier to capture the AI hard tech rally in Hong Kong.
Data source: Shanghai and Shenzhen stock exchanges. "First of its kind" refers to the Hong Kong Stock Connect Information Technology ETF (159131) being the first ETF in the market to track the CSI HK Stock Connect Information Technology Index. As of June 30, 2026, the latest on-exchange scale of the Hong Kong Stock Connect Information Technology ETF (159131) is 1.979 billion yuan, the largest among the eight ETFs tracking the same index. Since the beginning of this year, the ETF's average daily trading volume has been 689 million yuan, the highest among the eight ETFs tracking the same index.
Fee description for ETF funds: When investors subscribe or redeem fund shares, the subscription and redemption agency may charge a commission of up to 0.5%. On-exchange trading fees are subject to the actual charges of the securities company, and no sales service fee is charged. Fee description for feeder funds: The ChiNext AI ETF Feeder Fund Class C does not charge a subscription fee. The redemption fee is 1.5% for holding periods of less than 7 days and 0% for holding periods of 7 days (inclusive) or more. The sales service fee is 0.3%. The ChiNext AI ETF Feeder Fund Class A charges a subscription fee of 1% for amounts under 1 million yuan, 0.6% for amounts from 1 million yuan (inclusive) to 2 million yuan, and 1,000 yuan per transaction for amounts of 2 million yuan (inclusive) or more. The redemption fee is 1.5% for holding periods of less than 7 days and 0% for holding periods of 7 days (inclusive) or more. No sales service fee is charged. The Hua Bao CSI HK Stock Connect Information Technology ETF Feeder Fund charges a subscription fee of 0.30% for amounts under 1 million yuan, 0.20% for amounts from 1 million yuan (inclusive) to 2 million yuan, and 1,000 yuan per transaction for amounts of 2 million yuan (inclusive) or more. For individual investors, the redemption fee is 1.50% for holding periods of less than 7 days and 0.00% for holding periods of 7 days (inclusive) or more. For institutional investors, the redemption fee is 1.50% for holding periods of less than 7 days, 1.00% for holding periods from 7 days (inclusive) to 30 days, 0.50% for holding periods from 30 days (inclusive) to 180 days, and 0.00% for holding periods of 180 days (inclusive) or more. No sales service fee is charged. ETF subscription and redemption agencies may charge a commission of up to 0.5%. On-exchange trading fees are subject to the actual charges of the securities company.
Risk disclosure: The ChiNext AI ETF passively tracks the ChiNext Artificial Intelligence Index, which has a base date of December 28, 2018, and was published on July 11, 2024. The Hong Kong Stock Connect Information Technology ETF passively tracks the CSI HK Stock Connect Information Technology Index, which has a base date of November 14, 2014, and was published on June 23, 2017. The composition of the index constituents is adjusted according to the index compilation rules. The backtested historical performance does not indicate future index performance. The index constituents shown in the article are for display purposes only, and descriptions of individual stocks do not constitute any form of investment advice, nor do they represent the holdings or trading intentions of any fund managed by the fund manager. According to the fund manager's assessment, the ChiNext AI ETF and the Hong Kong Stock Connect Information Technology ETF have a risk rating of R4 (medium-high risk), suitable for active (C4) and above investors. The suitability matching opinion is subject to the sales institution's determination. Any information appearing in this article (including but not limited to individual stocks, comments, forecasts, charts, indicators, theories, any form of expression, etc.) is for reference only. Investors must be responsible for any investment decisions made independently. Furthermore, any views, analyses, or forecasts in this article do not constitute any form of investment advice to readers and are not liable for any direct or indirect losses arising from the use of the content of this article. Fund investment involves risks. Past performance of a fund does not represent its future performance. The performance of other funds managed by the fund manager does not constitute a guarantee of the fund's performance. Fund investment should be made with caution. MACD golden cross signal formed, these stocks are performing well!
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