Last week, the visit to China after a nine-year interval attracted global attention. The visit conveyed a very positive signal, indicating a thaw in relations and reflecting a relationship of equality between the two nations. Multiple achievements were made during the visit. Upon returning, the visitor publicly expressed great satisfaction with the trip in the media, contributing more stabilizing factors to the currently turbulent world. The relationship between the two countries is the most important diplomatic relationship globally. During the meetings, the visiting delegation included founders or leaders from 16 major U.S. corporations, such as Apple, Tesla, NVIDIA, and Goldman Sachs, which is a significant positive development for the improvement of economic and trade relations. This visit also suggests that the tariff disputes initiated last year may have formally concluded, as the U.S. Supreme Court has ruled them unlawful. After failing to achieve the expected returns from the tariff disputes, the focus has shifted towards seeking cooperation. An easing of tensions can promote global trade growth, benefiting the economies of both nations and the global economy as a whole.
The conflict in the Middle East continues, and there is an ongoing effort to find a dignified way to withdraw from the war, which requires support to facilitate negotiations and reach an agreement, thereby reopening the Strait of Hormuz. The Strait of Hormuz is a critical chokepoint for global oil transportation, controlling about 20% of the world's oil shipments. Since its blockade, international oil prices have surged significantly. Recently, discussions about the possibility of resuming military operations directly fueled market sentiment, pushing oil prices above $105 per barrel again. In response, international gold prices fell sharply, with spot gold dropping below $4,500 per ounce, a decline of over $1,000 from the peak of $5,600 per ounce reached late last year. The reasons for the sharp drop in gold prices include: first, the Federal Reserve has been forced to delay interest rate cuts in the face of rising inflation; second, the current Fed Chair's term ends on May 15, with a new nominee expected to take over, who is perceived as hawkish and may move quickly to tighten liquidity through balance sheet reduction, which is unfavorable for gold; third, there is no progress in negotiations regarding the Strait of Hormuz, with no clear date for reopening, leading to market expectations of further delays in Fed rate cuts, and even concerns about a potential shift towards rate hikes, putting downward pressure on gold; fourth, the latest U.S. CPI data reached 3.8%, the highest since May 2023, negatively impacting expectations for Fed rate cuts; fifth, gold prices have risen from $2,000 per ounce to a peak of $5,600 per ounce over the past two years, accumulating substantial profit-taking pressure, leading to a sustained correction. The risks of chasing rallies are evident again, but this significant decline also provides an opportunity for medium- to long-term investors to build positions on dips. From a long-term perspective, against the backdrop of de-dollarization, soaring U.S. government debt, and questioned dollar credibility, the long-term upward trend for international gold prices remains intact.
One of the best-performing sectors recently is the humanoid robotics sector. During the market adjustment in April, it was suggested that May might be a month of significant performance for humanoid robotics. On one hand, Tesla's robot, under its leadership, is set to launch the new Optimus V3 robot in July or August, which may boost the entire robotics sector. On the other hand, a robotics company has been under review for nearly two months and may conduct an IPO in the near future, potentially driving performance in robotics as well. The robotics sector has already validated this view, starting a significant rally after the Labor Day holiday. Since the beginning of last year, there has been a firm bullish stance on the robotics sector, with two funds heavily invested in this direction.
Recently, a U.S. humanoid robotics company fulfilled a promise by conducting an unedited eight-hour live stream, showcasing robots performing shift tasks in a factory. During the stream, the robots executed typical warehouse parcel sorting tasks, such as scanning barcodes, picking up various packages including flexible plastic bags and cardboard boxes, flipping labels face down, and accurately placing them on conveyor belts. Over eight hours, with zero human intervention, complete autonomy, and no supervision, the robots sorted nearly ten thousand parcels, exceeding human speed. It is believed that humanoid robotics is highly likely to become the fourth major industrial sector following home appliances, mobile phones, and new energy vehicles. This year, major manufacturers have begun mass production, with industry trends being led by a prominent figure. When new energy vehicles first emerged, this figure invested heavily in R&D and production, leading industry trends and publicly releasing over 400 patents related to new energy vehicles for free use by other automakers. Now that new energy vehicles have become a mature industry, transitioning from a blue ocean to a red ocean, the focus has shifted towards gradually phasing out new energy vehicle production and moving into three major areas: humanoid robotics, autonomous driving, and commercial spaceflight. It is reported that the largest automotive production lines for certain models in California have been completely shut down and converted into production lines with an annual capacity of one million humanoid robots, with a backup plan for another production line with an annual capacity of ten million robots in another state. The newly released robot features a dexterous hand with 22 degrees of freedom, and all patents for the dexterous hand have been announced, demonstrating a broad vision. This will help overcome the challenging technology of dexterous hands and significantly contribute to the rapid mass production and application of robots.
For the robotics industry, which is still in its early stages of development, it remains highly uncertain which manufacturers will achieve scale. However, following the logic that "those who sell shovels during a gold rush are sure to profit," one can focus on leading component suppliers within the supply chain. Regardless of how intense the competition among manufacturers is or which ones ultimately survive, component companies are likely to benefit. There are two methods to select leading companies: first, from a market capitalization perspective, as markets are efficient, leading companies generally attract capital attention; select three to four of the largest component suppliers by market cap within the supply chain. Second, from a performance perspective, select the three component companies within the supply chain that have shown the highest stock price gains. The former selects industry leaders from an industrial development standpoint, while the latter selects leaders based on stock performance, as the market itself is an important mechanism for filtering leaders. These two methods can also be referenced for investments in other technology sectors.
The global semiconductor industry is experiencing a supercycle. Over the past month and a half, the semiconductor sector has performed exceptionally well in markets including the U.S., Japan, and South Korea, becoming one of the strongest themes in capital markets. The semiconductor sector in the A-share market has also seen significant gains. According to Wind data, as of the close on May 15, multiple semiconductor sector indices, such as the CSI Semiconductor Materials & Equipment Index and the National Chip Index, have risen by over 40% since April 1, with the China-South Korea Semiconductor Index gaining nearly 60%. The recent surge in the memory chip sector is primarily due to the AI computing revolution forcing storage upgrades, severe supply-demand mismatches, and changes in industry business models. Traditionally, memory has been a highly cyclical industry, but the training and inference of large AI models have significantly increased storage demand per AI server compared to ordinary servers, completely disrupting the original supply-demand balance. The emergence of long-term agreements for memory marks a shift from high cyclical volatility to a long-term stable, predictable, and healthy structure for the memory industry. On the supply side, due to extended production expansion cycles and tight capacity in consumer electronics, memory prices have skyrocketed, boosting the performance and stock prices of memory companies. Specifically for the domestic memory industry chain, the investment logic mainly revolves around capacity expansion and equipment bottlenecks. Large-scale capacity expansion by domestic memory companies is the foundation for the rise of the local memory cycle, with equipment being the biggest bottleneck for memory expansion. From now until 2027, the memory industry is in a window of tight high-end capacity and high industry景气, with the growth logic far from over.
The six major technology sectors proposed early last year include: first, chips and semiconductors (including细分 segments such as optical modules, CPO, PCB, etc.); second, computing power and algorithm infrastructure; third, humanoid robotics; fourth, commercial spaceflight; fifth, energy storage directions such as solid-state batteries; and sixth, biomedicine. These six sectors have already produced many high-performing stocks and are key supported directions in the national development plan, with significant room for future growth. Except for a few technology stocks that have been excessively speculated on, leading to局部 bubbles, overall, there is still considerable room for development in technological innovation. Investors can focus on future opportunities in these six sectors.
Over the past few years, a unique value investment philosophy tailored to the local market has been developed and has achieved good verification results. The A-share market is an emerging market, quite different from mature markets like the U.S. stock market, with a high proportion of retail investors, significant market volatility, and susceptibility to policy influences. Therefore, practicing value investment in the A-share market cannot mechanically replicate philosophies from elsewhere; it must be adapted to the realities of the A-share market, forming a localized approach to value investment. This approach includes at least two aspects: first, being willing to adjust positions during periods of high market volatility. When market泡沫 are significant, be bold in reducing positions. For example,果断大幅减仓 was executed during a period of全民炒股 and significant market泡沫, successfully avoiding the subsequent nine-month decline and establishing a reputation. Conversely, seize opportunities at market lows, having successfully positioned at levels around 2600 points multiple times to capture market turning points. Second, interpret policies. Focus on sectors supported by policies, such as new energy in 2019, and technological innovation directions like chips and semiconductors, computing power and algorithms, and humanoid robotics in 2021. Avoid sectors restricted by policies to prevent significant losses. Practicing value investment in the A-share market must adhere to this localized approach to seize opportunities and avoid risks in the current market cycle.
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