A-share closing review | Shanghai index up 0.06% Morgan Stanley's heavyweight analysis! Igniting the lithium battery track

Peace talks between the US and Iran declared failure over the weekend, prompting Trump to announce a blockade of the Strait of Hormuz. Global markets experienced severe volatility on Monday, with oil and gas prices soaring and stock markets in Japan, South Korea, and the US futures collectively declining. The A-share market once again showed resilience today, with all three major indexes opening low but closing higher. Strong performances continued in the lithium battery sector, with Contemporary Amperex Technology reaching a record high and a market capitalization surpassing two trillion at one point, supporting the ChiNext Index to reach a new high. The Shanghai Composite Index closed slightly higher. The market saw a total turnover of 2.1 trillion with more stocks falling than rising. Looking at the market, the lithium battery sector saw a strong surge, with Shandong Sacred Sun Power Sources up for three consecutive days. According to the latest research from Morgan Stanley, the lithium market is expected to officially enter a period of supply shortage in the second half of 2026. This is not simply a cyclical fluctuation, but a structural reversal driven by "hard constraints" on the supply side and the explosion of energy storage demand. In other hot spots, the CPO concept was active, with Raisecom Technology, Shenzhen Everbest Machinery Industry, and TKD Science and Technology hitting the limit up, while Henan Shijia Photons Technology, Accelink Technologies, Yuanjie Semiconductor Technology, Suzhou Everbright Photonics, and Zhongji Innolight continued to hit record highs. On the downside, the gaming sector collectively declined, with Kingnet Network hitting the limit down and Shenzhen Bingchuan Network falling by over 10%. Huajin Securities stated that the A-share market may have bottomed out in the short term, continuing a trend of relatively strong bottom oscillation. Donghai Securities said that in the context of high oil prices, overseas demand may be affected, but the premium on the integrity of the domestic manufacturing supply chain may be enhanced, suggesting a focus on domestic autonomous technology (such as computing power under security guarantees, new energy, etc.), service consumption (such as domestic tourism), and innovative drugs (such as AI applications, BD transactions), among others. In terms of individual stocks, 2378 stocks rose, 2960 fell, and 164 remained unchanged. There were 86 stocks limit up and 10 limit down. At the close, the Shanghai Composite Index rose 0.06% to 3988.56 points, with a turnover of 919.4 billion yuan; the Shenzhen Component Index rose 0.69% to 14407.86 points, with a turnover of 123.09 billion yuan. The ChiNext Index rose 0.80% to 3476.44 points. Funds flow Major funds focused on glass fiber, communication services, electricity, and other sectors today, with top inflows going to Hygon Information Technology, Sinoma Science & Technology, and NET263 Ltd. News recap 1. Multiple game companies: Palace fighting and other regulations not changed recently Recently, there has been widespread attention in the market and industry regarding the spread of content related to the approval of game licenses. Multiple game companies have learned that the regulatory requirements for controlling the number of license products, including palace fighting, official fighting, and chess games, were actually old regulations from 2019. There have been no new regulatory changes in the gaming industry recently. 2. MIIT: Will compile a panoramic view and transformation roadmap for major industries' "artificial intelligence + quality" applications by 2026 The Ministry of Industry and Information Technology released a notification on improving the quality of industrial and information work by 2026. It emphasizes deepening quality improvement through artificial intelligence. It will compile a panorama and transformation roadmap for the application of "artificial intelligence + quality" in key industries, clarifying the key areas of integration between artificial intelligence and quality, implementation steps, expected goals, etc., to provide clear guidance for enterprise transformation. 3. Honor in talks with ByteDance for cooperation on "Bean Phone" According to sources, Honor is in talks with ByteDance for cooperation on the "Bean Phone." Before collaborating with ZTE Corporation to launch the first generation of Bean Phones, ByteDance actually first contacted Honor. However, Honor was cautious at the time, considering such deep system-level collaborations to have certain risks: the Bean Phone as an exploratory engineering machine, the technology route could be more aggressive. Market analysis 1. BOC International: Winning in the mainline in the entanglement of no resolution When the market faces new variables, it often encounters significant adaptation difficulties, unable to escape the constraints of the same unresolved issues for configuration, and asset pricing falls into the narrative noise of no solution, ignoring the mainline with a solution. The technology sector has continuously hit new highs under the triple resonance of industrial trends, earnings expectations, and asset pricing, while the market is still caught up in high-frequency debates around the Middle East situation. This itself indicates that many investors are still stuck in old frameworks of explaining everything with geopolitical risks and covering everything with grand uncertainties, but neglecting the mainline that truly has sustained pricing power is not in the Middle East, but in technology. For A shares, the key variables determining the medium-term direction may not be a geopolitical event that is constantly disrupting in the short term and difficult to form stable trading conclusions, but whether the technology industry trend is still strengthening, industry mapping is still expanding, and market risk preferences are still willing to pay a premium for "certain prosperity growth." In a sense, the sustained new highs in technology itself is the answer. 2. Donghai Securities: The premium on the integrity of the domestic manufacturing supply chain may be enhanced in the context of high oil prices In the context of high oil prices, overseas demand may be affected, but the premium on the integrity of the domestic manufacturing supply chain may be enhanced, suggesting a focus on autonomous domestic technology (such as computing power under security guarantees, new energy, etc.), service consumption (such as domestic tourism), and innovative drugs (such as AI applications, BD transactions) in the sector; in the chemical industry, focus on targets with increased concentration, balance sheet repair, such as chemical fiber, dyes, agricultural chemicals, etc. This article is reproduced from "Tencent Stock Selection". Editor: Liu Jiayin.