A-share midday review | ChiNext index rose 0.32%, led by Hainan Free Trade Zone sector, liquor stocks fell

On September 12, the three major indexes of A-shares weakened again, with the Shanghai Composite Index briefly turning downward and the ChiNext Index narrowing its gains after rising more than 1% earlier. By the close, the Shanghai Composite Index fell by 0.05%, the Shenzhen Component Index fell by 0.08%, and the ChiNext Index rose by 0.32%. In terms of market performance, the Hainan concept remained active, with Hainan Haiyao and Hainan Shuangcheng Pharmaceuticals both experiencing consecutive trading limit increases. Stocks in the photovoltaic sector continued to be active, with Jiangxi Haiyuan Composites Technology seeing consecutive trading limit increases. Stocks in the high-speed copper cable connectivity sector generally opened higher, with Henan Carve Electronics Technology and Shenyu Communication Technology Inc. rising by more than 5%. Sora concept stocks saw a surge, with Huayang OURGAME and Guangdong Insight Brand Marketing Group rising by more than 5%. In terms of declines, the liquor sector fluctuated downward, with Kweichow Moutai falling by nearly 2% to its lowest price since November 2022. Foldable screen concept stocks also declined, with Kunshan Kersen Science & Technology hitting the trading limit for the fourth consecutive day. Insurance and bank stocks continued to adjust, with Hubei Biocause Pharmaceutical hitting the trading limit, Agricultural Bank Of China, and China Construction Bank Corporation falling by more than 1.5%. Shanghai Guijiu hit the trading limit, with the company announcing that its actual controller had been taken into criminal coercive measures. In terms of main fund flows, funds favored industries such as communication equipment, components, and medical equipment, while funds fled from industries such as banks, energy metals, and batteries. Institutional viewpoints Looking ahead, China Securities Co., Ltd. stated that investors should continue to focus on the direction of stable growth policies, sectors showing marginal improvement in performance at low levels, sectors presenting performance growth in their mid-year reports or facing performance inflection points, sectors stimulated by policies and events, and sectors related to state-owned enterprise reforms. China Securities Co., Ltd.: Changes in market structure are favorable for the restoration of investor risk appetite In recent days, there have been some changes in the market structure, with adjustments in high dividend stocks and increased activity in low-level thematic concept stocks. This change is conducive to boosting market sentiment and restoring investor risk appetite. Investors should continue to focus on the direction of stable growth policies, sectors showing marginal improvement in performance at low levels, sectors presenting performance growth in their mid-year reports or facing performance inflection points, sectors stimulated by policies and events, and sectors related to state-owned enterprise reforms. They should continue to grasp the rotation of hot spots and operational rhythms, patiently waiting for the market to bottom out. Sinolink: Huawei launches Mate XT foldable phone, continue to be optimistic about foldable screen penetration Sinolink's research report pointed out that on September 10, Huawei launched the Mate XT foldable phone. The hardware components of foldable phones have shown significant growth, with hinges and flexible screens being the main incremental costs of foldable screen phones. As foldable screen smartphone components transition from highly customized to standardized, modular supply models, product manufacturing processes become streamlined, production efficiency and yield rate increase, and this is expected to bring economies of scale, effectively reducing the overall manufacturing costs of foldable screen phones and accelerating industry penetration. Recommendations include NBTM New Materials Group. Haitong: China's semiconductor market is gradually recovering, industry has gradually destocked Haitong's research report stated that semiconductor materials benefited from downstream demand recovery and accelerated import substitution, with overall revenue and net profit both showing positive growth. In the first half of 2024, the company achieved an average year-on-year revenue growth rate of 15.94% and an average year-on-year net profit growth rate of 15.65%. Globally, in the first half of 2024, the semiconductor industry experienced a moderate recovery, with strong demand for data centers and artificial intelligence driving rapid development in the AI server and storage chip market. At the same time, downstream semiconductor terminals such as smartphones and computers showed warming consumer electronics demand, leading the global integrated circuit industry back into a growth cycle. In China's market, in the first half of 2024, the semiconductor market is gradually recovering, and the industry has gradually destocked, with major wafer manufacturers steadily increasing their capacity utilization rates. Hot sectors 1. Hainan Free Trade Zone sector remains active The Hainan Free Trade Zone sector remained active, with Hainan Haiyao and Hainan Shuangcheng Pharmaceuticals experiencing consecutive trading limit increases. Xinlong Holding (Group) Company, Honz Pharmaceutical, Hainan Jinpan Smart Technology, and others were among the top gainers. Comments: Recently, the Ministry of Finance and other five departments announced zero tariffs on drugs and medical devices in the Hainan Free Trade Port. It mentioned that before the island is completely closed for operation, medical institutions, medical education institutions, and medical research institutes with independent legal person qualification registered in the International Medical Tourism Pilot Zone in Boao, Hainan, and using drugs and medical devices as stipulated in this policy, can be exempted from import duties and import VAT. 2. Photovoltaic concept stocks remain active Photovoltaic concept stocks remained active, with Jiangxi Haiyuan Composites Technology experiencing consecutive trading limit increases. Wuxi Autowell Technology Co., Ltd. and Bringspring Science & TechnolOgy rose by more than 5%, with Hainan Drinda New Energy Technology, TCL Zhonghuan Renewable Energy Technology, Jolywood, Shanghai Aiko Solar Energy, Hangzhou First Applied Material, Gansu Golden Solar and others following suit.Review: On the news front, under the stimulus of the news that Contemporary Amperex Technology is "considering adjusting production capacity", stocks in the photovoltaic, CECEP Solar Energy, and lithium mining sectors collectively surged last night. Pacific Securities believes that the next six months to a year will be a window period for the solar industry to confirm the bottom of the big cycle. In the short term, the start-up rates of various links continue to decline, capacity reduction accelerates, and industry chain prices remain stable for the time being; in the long term, accelerating overseas expansion is the common choice for the industry chain. 3. AI concept stocks show abnormal trading and rise AI concept stocks show abnormal trading and rise, Huayang OURGAME2 hit the daily limit consecutively, and stocks like Guangdong Insight Brand Marketing Group, Wondershare Technology Group, TVZone Media, Kunlun Tech, and Zhejiang Huace Film & TV followed the uptrend. Review: On the news front, the CEO of NVIDIA stated that the demand for Blackwell in the market is too strong, and the supply shortage has caused tension in customer relationships. Suppliers are working hard to catch up, and NVIDIA's stock price rose by over 8%. 4. State-owned enterprise reform concept rises again The concept of state-owned enterprise reform rose again, with Baoding Tianwei Baobian Electric hitting the daily limit for 6 consecutive trading days, and other stocks like Harbin Dongan Auto Engine, Jianshe Industry Group, Gansu Mogao Industrial Development, and Hangzhou Hirisun Technology Incorporated also hitting the daily limit. Review: On the news front, Tan Zuojun, member of the Party Committee and Deputy Director of the State-owned Assets Supervision and Administration Commission of the State Council, stated that in the next step, the Commission will fully leverage the breakthrough and driving role of reform, promote central enterprises to enhance core functions, improve core competitiveness, actively cultivate and develop new productive forces, and accelerate the construction of more world-class enterprises. This article is reproduced from "Tencent Securities"; GMTEight editor: Wang Qiujia.