A-share midday review | ChiNext Index rose by 1.78%, the pharmaceutical industry chain surged, and high-level stocks continued to decline.

The A-share market surged in early trading on November 12, with the Shanghai Composite Index turning green. The ChiNext Index rose more than 2% at one point, with heavyweight stock Contemporary Amperex Technology surging over 6%. By the close, the Shanghai Composite Index fell 0.06%, the Shenzhen Component Index rose 1.02%, and the ChiNext Index rose 1.78%. On the plate, the pharmaceutical industry chain soared, with pharmaceutical commerce, traditional Chinese medicine, medical aesthetics, and medical equipment leading the way. The automotive sector rose again, ST stocks hit limit up, new energy stocks such as photovoltaics and lithium mines remained active, and liquor and breeding sectors led the gains. In terms of declines, the semiconductor sector saw a pullback, with insurance and military industries leading the declines. Additionally, high-priced stocks continued to decline, with China Zhonghua Geotechnical Engineering Group, Hainan Shuangcheng Pharmaceuticals, Nanfang Black Sesame Group, Landai Technology Group Corp., China Fortune Land Development, and Hua Ying Technology hitting limit down for two consecutive days. In terms of main funds, funds favored medical services, chemical pharmaceuticals, pharmaceutical commerce, and medical equipment industries, while fleeing from semiconductor, securities, software development, and IT services industries. Institutional Views Looking ahead, EB SECURITIES believes that recent policy favorable, and subsequent policy favor could be expected, while there is a high level of popularity in the market, indicating that the market may continue to fluctuate upwards. CICC: A-shares return to prosperity, returning to the track layout CICC research report pointed out that A-shares are returning to prosperity and returning to the track layout. Some of China's industries have undergone years of adjustment, and production capacity is expected to be cleared under policy guidance and industry trends, with more industries entering prosperity next year. With the improvement of investor risk appetite, the investment concept of the past 3 years may face adjustments, and track research and prosperity investment are expected to gradually return. EB SECURITIES: Market expected to continue to fluctuate upwards EB SECURITIES believes that the positive news of the 10 trillion debt-to-equity swap pushed A-shares to continue rising on Monday. In terms of structure, the news of "TSMC cutting off supply" stimulated a surge in technology stocks led by chip semiconductors, driving the overall market popularity. Looking ahead, with continuous positive policy and anticipated subsequent policy favor, as well as a sustained high market popularity, the market is expected to continue to fluctuate upwards. Huatai: Market may be gathering energy for the next major upward trend Huatai believes that after a rapid short-term market rise, the market usually shifts to an upward trend with fluctuations, and the overall index still has opportunities for increase. The market may be gathering energy for the next major upward trend, and the choice of investment structure in the near future may be key. The upcoming important observation windows are the end-of-month important meetings, the year-end Central Economic Work Conference, and next year's two sessions. During this period, expectations for more incremental policy measures remain. Currently, A-share valuations are at a historically moderate level, with high long-term investment value. With the implementation of the large-scale debt reduction measures and the subsequent fiscal policy strengthened, market risk appetite may increase and investment confidence is expected to be boosted, driving A-share valuations to rise. Hot Sectors Pharmaceutical industry chain soars The pharmaceutical industry chain soared, with traditional Chinese medicine, medical aesthetics, innovative drugs, and medical equipment sectors collectively rising. Stocks such as Sichuan Hezong Medicine Easy-To-Buy Pharmaceutical, Shaanxi Kanghui Pharmaceutical, Wanbangde Pharmaceutical Holding Group, Xi'An International Medical Investment, New Journey Health Technology Group, Thalys Medical Technology Group Corporation, and Cowealth Medical China all hit limit up. Analysis: Zhongtai International research report pointed out that after experiencing policy stimuli such as interest rate cuts, the pharmaceutical industry will return to rational investment, and the market will wait and see if the government will provide more financial support to the pharmaceutical industry in the future. In the short term, it is recommended to focus on stocks with strong certainty of 2024 performance and sufficient funds. 2. Automobile stocks rise again The automobile sector concept has been active again, with Jiangling Motors Corporation and Dongfeng Automobile both hitting limit up, with SAIC Motor Corporation, Yutong Bus Co., Ltd., and Zotye Automobile leading in gains. Analysis: According to China Association of Automobile Manufacturers data, car sales in October reached 3.053 million units, a year-on-year increase of 7%, of which the production and sales of new energy vehicles both increased by nearly 50%. Guoyuan believes that the profitability of the automobile industry has entered a stage of stable growth and high-quality development, and it is recommended to pay attention to the industry's end-of-year market trend and the specific implementation of the "trade-in for a new one" policy by the end of the year. 3. Lithium mining sector rebounds The lithium mining sector rebounded, with Yongxing Special Materials Technology hitting limit up, previously Willing New Energy rising for two consecutive days, Canmax Technologies rising by over 10%, and Sinomine Resource Group, Ganfeng Lithium Group, Tianqi Lithium Corporation, and Qinghai Salt Lake Indust.RY and follow the rise.Review: On the news front, the main contract of lithium carbonate futures on the Guangzhou Futures Exchange rose by more than 4% for the second consecutive day. CITIC Futures believes that this is due to strong demand performance exceeding expectations on one hand, and on the other hand, due to some overseas mining companies lowering their future production guidance in their third-quarter reports, which has promoted the fermentation of bullish sentiment. This article is reprinted from "Tencent Stock Selection"; GMTEight Editor: Wang Qiujia.