Markets staged a powerful rebound today, with the STAR 50 Index surging over 10%, marking its largest intraday gain this year. Technology stocks led the charge.
On the market front, CPO concepts continued their recovery, with stocks like Zhongji Innolight Co.,Ltd. (SZSE: 300308), Luobotec, and Lianxun Instruments all rising more than 10%. Changxin Bocrun, New Seaunion, and Accelink also posted significant gains. The semiconductor industry chain, encompassing equipment, memory chips, MLCCs, power semiconductors, and advanced packaging, saw a substantial rally. Leading firms such as Naura, Zhenbao Technology, and GigaDevice were among those hitting the daily limit-up.
Concepts like zirconia and computing metals also rose, with companies like Sinocera and Orient Zirconic reaching limit-up.
On the decline, the aged care sector retreated once more. Biopharmaceuticals, generic drugs, CRO, and traditional Chinese medicine concepts all pulled back. Oil-related concepts and the oil & gas industry chain weakened further. Pork and chicken concepts continued their descent. The broader consumer sector, including medical aesthetics, dairy, food & beverage, baijiu, and retail, also declined.
The real estate industry chain fell again, with stocks like Hualian Holdings and Yango Group dropping over 7%. Major financial sectors like banking, insurance, and securities collectively moved lower.
Additionally, Demingli, a previously high-flying memory stock that had suffered four consecutive limit-down sessions, opened limit-down this morning but later surged to hit limit-up in the afternoon session.
Looking at individual stocks, 3,107 companies advanced while 2,301 declined, with 121 unchanged. A total of 120 stocks hit limit-up, and 29 hit limit-down.
At the close, the Shanghai Composite Index rose 1.79% to 3,864.37 points, with a turnover of 1,396.5 billion yuan. The Shenzhen Component Index gained 4.81% to 14,264.29 points, with a turnover of 1,548.3 billion yuan. The ChiNext Index climbed 7.05% to 3,685.97 points.
Looking ahead, Chen Guo, Deputy Director and Chief Strategist of the East Money Securities Research Institute, believes "the tech rebound in the A-share market has begun."
Today's Capital Flows
Main capital flows today focused on buying into semiconductors, communication equipment, consumer electronics, components, and industrial metals. Sectors seeing net outflows included Baijiu II, electric power, joint-stock banks II, chemical pharmaceuticals, and city commercial banks II.
Key Developments Recap
1. China Reform Holdings and others have established an industrial innovation private equity fund. Recent business registration information shows the establishment of the Shanghai Guoxin Chuang Chuang Private Equity Fund Partnership, with a capital contribution of approximately 6 billion yuan. Its business scope includes engaging in equity investment, investment management, and asset management activities via private funds. The partnership is jointly held by entities including Shanghai Chuang Chuang Private Equity Fund Partnership and Guoxin Holding (Shanghai) Co., Ltd., a wholly-owned subsidiary of China Reform Holdings Co., Ltd.
2. Three popular broad-based ETFs have seen turnover exceed 100 billion yuan for three consecutive days. The turnover for the STAR 50 ETF (ChinaAMC), ChiNext ETF (E Fund), and CSI 300 ETF (Huatai-PineBridge) all broke through 100 billion yuan (currently 15.1 billion, 12.9 billion, and 10.0 billion yuan respectively). These three ETFs have surpassed 100 billion yuan in turnover for three straight trading sessions. Furthermore, the STAR 50 ETF (ChinaAMC) saw a net subscription of 7.629 billion units yesterday (representing net subscription funds of 13.701 billion yuan), setting a new single-day net subscription record.
3. Institution Forecast: Global chip equipment sales are expected to grow 23.2% by 2026, reaching $229.5 billion by 2028. According to a report by SEMI, global semiconductor equipment sales are projected to increase by 23.2% in 2026 to $165.9 billion, and are expected to hit a record high of $229.5 billion by 2028. SEMI represents approximately 3,000 electronic design and manufacturing companies worldwide. The association stated that the expansion of AI infrastructure and investments in advanced logic chips and next-generation memory products, including HBM, will drive market growth.
Market Outlook Analysis
1. Deputy Director, East Money Securities Research Institute: The A-share Tech Rebound Has Begun. Chen Guo, Deputy Director and Chief Strategist, asserts that the tech rebound in the A-share market has begun. His research report analysis indicates there is no need for excessive pessimism towards domestic tech leaders. The medium-term growth logic for the AI industry remains intact, with the expansion cycles for domestic chips and computing power expected to maintain strong momentum. Compared to overseas memory industry cycles, the tactical value of selling silicon-based upstream assets at current low levels to chase dividend assets is relatively low. Trading-oriented funds can participate in the sector rebound, while allocation-oriented funds should hold firm to core domestic tech assets like wafers, semiconductor equipment, and Hong Kong-listed internet stocks.
2. Xia Fanjie, Strategy Analyst, China Securities Co., Ltd.: This Round of Market Correction is Largely Over, Poised to Start a New Upward Trend. Xia Fanjie's latest view points out that the significant correction in the A-share market since July is a technically-driven adjustment led by capital flows and trading structures, not a deterioration in fundamentals, and the market could stabilize and rebound at any time. On one hand, major indices have seen significant pullbacks, with valuation and trading crowding pressures largely released. Furthermore, entities like China Reform Holdings, Chengtong, and leading insurers have successively expressed intentions to enter the market, while broad-based ETFs continue to see substantial inflows. Simultaneously, overseas chip sectors have stabilized and recovered, and external risks are gradually receding. Xia believes the firm inflow of medium to long-term capital can intervene promptly to halt negative feedback and provide a new pricing anchor during liquidity crises or loss of market expectations. With the market fully adjusted and external risks subsiding, this round of correction is largely over and is poised to start a new upward trend.
3. Huaxi Securities: The Medium-to-Long-Term Tech Rally is Not Over; Differentiation and Rotation Will Prevail for Now. Huaxi Securities believes that, at the current juncture, the most intense selling pressure may have passed. The market will likely enter a new phase of "volatility and slow repair," with limited downside for indices, while an upward breakthrough also requires coordination from both fundamentals and capital flows. On one hand, A-share tech stocks' desensitization to overseas markets needs time. The deleveraging pace in the South Korean stock market still requires observing a sustained decline in forced liquidation volumes. Moreover, foreign investors in South Korea have been net sellers for four consecutive months. Before the South Korean market desensitizes to leveraged trading, it will still have a sentimental impact on global assets. On the other hand, driven by industry trends, the tech rally is expected to continue. However, before a new round of strong industry catalysts emerges, it will be difficult to replicate the extreme concentration seen in the first half of the year, making rotation and differentiation the main themes. One approach is to select high-quality individual stocks with strong fundamental support. The other is to rotate towards the domestic supply chain and mid-to-downstream segments. For sector allocation, focus on growth with solid performance, selecting high-quality stocks with strong fundamentals around the upstream, midstream, and downstream industries related to "AI+". Attention can also be paid to related high-quality targets in areas like "innovative drugs, Hong Kong-listed internet stocks, and media & gaming".
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