A-shares closing review | Shanghai index closes down 1.06%, continuing to hit a new low in adjustments. The pharmaceutical industry chain collectively explodes.

On September 9, the Shanghai Composite Index fluctuated lower throughout the day, hitting a new low in adjustment, while the ChiNext Index showed slightly stronger performance. Towards the end of the trading session, Contemporary Amperex Technology, Zhongji Innolight and other heavyweight stocks lifted the ChiNext Index into positive territory. By the close, the Shanghai Composite Index fell by 1.06%, the Shenzhen Component Index fell by 0.83%, and the ChiNext Index rose by 0.06%. In terms of the market, pharmaceutical stocks surged across the board, with sectors such as cell immunotherapy, innovative drugs, and stem cells leading the way. Guanhao Biotech, Improve Medical Instruments, Chimin Health Management and others sealed their limit up positions. Stocks related to state-owned enterprise reform saw a surge in price limits, with nearly 20 stocks such as CHINA TOURISM AND CULTURE INVESTMENT GROUP, Shanghai Join Buy, and Western Regions Tourism Development hitting the limit. Some foldable screen and consumer electronics concept stocks maintained their strength, with Anhui Tatfook Technology and Hua Ying Technology hitting the limit. Non-banking financial stocks such as securities firms and insurance companies rose, with Tianfeng and Hubei Biocause Pharmaceutical hitting the limit up. On the downside, stocks at high levels collectively declined, with many previous strong performers such as Shenzhen Huaqiang Industry, Kunshan Kersen Science & Technology, Dazhong Transportation (Group) Co., Ltd., and Ways Electron hitting the limit down. Weighted dividend stocks such as coal, banks, and oil plummeted significantly, with many stocks like Yankuang Energy Group, Pingdingshan Tianan Coal Mining falling by more than 4%, and China Merchants Bank plummeting by over 3%. Stocks in the car industry chain, including ride-hailing and auto manufacturers, collectively fell, with stocks like REFORMER and Xiamen King Long Motor Group hitting the limit down or plummeting by over 10%. Overall, more stocks fell than rose, with over 3000 stocks in the entire market declining. The turnover of the Shanghai and Shenzhen stock markets today was 518.6 billion yuan, down by 24.1 billion yuan from the previous trading day. In terms of institutional views, Looking ahead, the China Securities Li Qiusuo team believes that the market is showing more bottom characteristics, but confidence restoration still requires more positive factors. China Securities Co., Ltd.: Recent market position and phenomena show bottom characteristics The Jiantou Securities Chen Guo team said that the recent market position and phenomena show bottom characteristics. However, the Fed's interest rate cut and domestic policy efforts will improve valuations and profit expectations, and with the base effect in the fourth quarter, the basic year-on-year data is expected to show an upward trend. Investors should seize opportunities for layout. It is recommended to consider the bottom layout based on three clues: the reality of economic improvement under the clues of equipment renewal and consumer goods replacement, the resilience of the industries related to domestic demand in the interim report, and the valuation recovery direction with the logic of self-industry expectation at the bottom. China International Capital Corporation: The market shows many bottom characteristics, but confidence restoration still requires more positive factors The Li Qiusuo team of China International Capital Corporation also believes that the market shows many bottom characteristics, but confidence restoration still requires more positive factors. Furthermore, they believe that since mid-July, the adjustment of consumer electronics and semiconductors has exceeded 10%, with not high valuations. Combined with the possibility of more catalytic factors in the recent consumer electronics sector, a phase market may appear. Soochow: Brokerage sector valuation and profitability are at historical bottoms with great potential for long-term valuation recovery The Soochow Research Report states that the current valuation and profitability of the brokerage sector are at historical bottoms, with significant potential for long-term valuation recovery. The ongoing wave of mergers and acquisitions is expected to optimize industry competition, and restructured brokerage firms may achieve leapfrog development. Based on this, we recommend: 1) top brokerage firms whose PB valuation is far below 1, pay attention to Guotai Junan, and Huatai; 2) recommend internet securities platform companies with strong performance recovery elasticity, such as Hithink RoyalFlush Information Network, East Money Information, Beijing Compass Technology Development, and pay attention to Shenzhen Fortune Trend Technology. Hot Sectors 1. The entire pharmaceutical industry chain is skyrocketing Pharmaceutical stocks surged across the board, with sectors such as cell immunotherapy, innovative drugs, and stem cells leading the way. Guanhao Biotech, Improve Medical Instruments, Chimin Health Management and others sealed their limit up positions. 2. State-owned enterprise reform sector continues to strengthen State-owned enterprise reform concept stocks have triggered a surge in price limits, with CHINA TOURISM AND CULTURE INVESTMENT GROUP, Shanghai JAround 20 stocks, including Oin Buy and Western Regions Tourism Development, hit the daily limit up.Review: Recently, there have been continuous actions in the reform of state-owned enterprises in China. China CSSCChina Shipbuilding Industry, Guotai Junan, and Haitong have successively announced mergers. China Galaxy Securities research report pointed out that the Third Plenary Session of the Twentieth Party Congress proposed seven major directions for the future reform of state-owned assets and enterprises, deepening the reform of state-owned assets and enterprises, promoting the strengthening, optimization, and expansion of state-owned capital and enterprises, enhancing core functions, and improving core competitiveness. 3. Brokerage stocks rebound Brokerage and non-bank financial stocks such as insurance have risen, with Tianfeng and Hubei Biocause Pharmaceutical hitting the limit up. Review: Soochow research report stated that the current valuation and profitability of the brokerage sector are at historical lows, with significant room for long-term valuation recovery. At the same time, the wave of mergers and acquisitions continues to advance, and the industry's competitive landscape is expected to be optimized. Restructured brokerages may achieve breakthrough development. 4. Banking stocks unilaterally declined Banking stocks unilaterally declined, with China Merchants Bank dropping more than 3% on high volume. Review: With expectations of a reduction in existing home loan rates, concerns about pressure on bank interest margins are continuing to spread. Banking stocks have been under continuous pressure recently. Tianfeng analysts believe that from the perspective of institutional behavior, a reduction in existing home loan rates may further increase the impact on banks' existing businesses, potentially exacerbating asset and profit shortages. However, if subsequent reductions in existing home loan rates occur, commercial bank deposit rates may further decline, and the impact on bank interest margins is expected to be neutral. This article is reprinted from "Tencent Stock Selection," edited by Huang Xiaodong.