A-share midday review | A-share "decoupling" from external influences to trade independently! The Shanghai Composite Index rose 0.67% in the first half. Moutai regains the "stock king" throne.

The deadline for the two-week ceasefire agreement between the US and Iran is approaching, and military confrontation has escalated in the Strait of Hormuz and surrounding waters. Iran has announced a re-imposition of restrictions on navigation in the strait, while the US has seized an Iranian cargo ship for the first time using force. As a result of this news, international oil prices opened with a 7% increase, while US stock index futures fell over 1%. On April 20, A-shares traded independently, with the three major indexes showing a morning shake and rise, with the BSE 50 index rising over 3% midday. Kweichow Moutai surpassed Yuanjie Semiconductor Technology once again to become the top stock in the A-share market. By midday, the Shanghai Composite Index rose by 0.67%, the Shenzhen Component Index rose by 0.60%, and the ChiNext Index rose by 0.04%. The turnover in the Shanghai and Shenzhen stock markets reached 1.71 trillion yuan in the first half of the day, an increase of 125.4 billion yuan from the previous trading day. In terms of market performance, the fiber optic cable concept quickly strengthened, with multiple stocks such as North Electro-Optic, Jiangsu Zhongtian Technology, and Tongding Interconnection Information hitting limit up; liquid cooling, optical module, and PCB concepts rose, with TDG Holding and Founder Technology Group hitting the limit; commercial aerospace concepts shook and strengthened, with China Spacesat, Sichuan Shudao Equipment & Technology, Tellhow Sci-Tech hitting limit up; computing power leasing concepts rose, with Three's and Holitech Technology hitting limit up; power grid equipment concepts continued to rise, with Fujian Nanping Sun Cable and Yuan Cheng Cable hitting limit up; AI application end was active, with Qingmu Tec Co., Ltd. and Xiamen Jihong Package Technology hitting limit up or rising over 10%; stocks from the Northern Exchange continued to be active, with KAIHUA MATERIAL and CHINA GEOKON rising nearly 20%. In addition, the performance of diamond cultivation, photovoltaic equipment, precious metals, and sports sectors were also notable. In terms of declines, healthcare and pharmaceutical stocks fell, with Zhejiang Haisen Pharmaceutical and Jiangsu Nhwa Pharmaceutical falling over 5%; the real estate sector weakened, with Beijing Urban Construction Investment & Development falling nearly 5%; the battery industry chain underwent adjustments, with Sunresin New Materials falling over 10% and Wuxi Jinyang Precision Manufacturing falling over 7%; retail stocks fell at the beginning of the session, with Hefei Department Store Group and Yonghui Superstores falling over 3%. Additionally, the education, coal mining, and chemical industries showed weaker trends. Regarding the focus stocks, on the morning of April 20, Kweichow Moutai's stock price fluctuated narrowly, while Yuanjie Semiconductor Technology's stock price showed a more significant decline, leading Kweichow Moutai to surpass Yuanjie Semiconductor Technology once again to become the top stock in the A-share market. Looking ahead, Guotai Haitong believes that the upward momentum in the Chinese stock market is far from over, and the market is expected to reach new highs in the future. Sinolink points out that under different outcomes of geopolitical risks, energy may be a common beneficiary. Click on the link to see more brokerage analysis. Hot Sectors 1. Liquid cooling server concept remains active The liquid cooling server concept strengthened, with Shenzhen Envicool Technology hitting limit up, reaching a new high, and Zhe Jiang Kangsheng hitting the board for 4 consecutive days. Comment: Institutions point out that the value of liquid cooling architecture and systems varies with chip power and cabinet architecture. By 2025, the GB200 and GB300 computing trays shipped will have a cooling mix of 85% liquid cooling and 15% air cooling. It is expected that the Vera Rubin NVL72 computing frame that will start shipping in 2026 will use 100% liquid cooling for heat dissipation, with higher power for Rubin Ultra and Feynman, gradually entering the era of full liquid cooling overseas. 2. Fiber optic concept collectively strengthened The fiber optic concept quickly rose, with Tongding Interconnection Information hitting the limit up for 3 days out of 2, Jiangsu Zhongtian Technology hitting limit up, and Yangtze Optical Fibre And Cable Joint Stock and Hengtong Optic-Electric following suit. Comment: In terms of news, the fiber optic industry has shown a prosperous trend of "rising product quantity and price" since the beginning of the year. A person in charge of a fiber optic production enterprise in Jiangsu recently told reporters that in the first quarter of this year, fiber optic production and sales volume increased nearly five times year-on-year, and product prices also saw a substantial increase. The price of G.657.A2 fiber optic, which was 32 yuan per core kilometer last year, has risen to 240 yuan this year, an increase of 650%. 3. AI application end surged The AI application end was active, with Qingmu Tec Co., Ltd. and Xiamen Jihong Package Technology hitting the limit up or rising over 10%. Comment: In terms of news, AI star company Anthropic recently launched version 4.7 of its flagship artificial intelligence model ClaudeOpus, focusing on advancements in the software engineering field, while also making significant progress in financial analysis, visual capabilities, and creative "taste". 4. Commercial aerospace concept shook and strengthened The commercial aerospace concept shook and strengthened, with China Spacesat, Sichuan Shudao Equipment & Technology, and Tellhow Sci-Tech hitting the limit up. Comment: In terms of news, at the 2026 "China Space Day" press conference, the National Aerospace Administration stated that in 2026, China's aerospace missions will continue to be intensively implemented: Tianwen-2 will approach the target asteroid for close-range exploration; the Changzheng Engineering Technology will carry out tasks such as Shenzhou-23 manned spacecraft; multiple reusable rockets will conduct flight verification. Institutional Perspectives Guotai Haitong: The Chinese stock market is not about to stop, the upward momentum is far from over Looking ahead, the upward momentum in the Chinese stock market is far from over, and the market is expected to reach new highs in the future. 1) After "924" in 2024, concerns about "internal worries" are decreasing; in 2025, the confrontation between China and the US, all sectors no longer have suspicions of US sanctions; in 2026, the conflict between the US and Iran is also an important turning point, reflecting the advantages of China's industry, whether it is technological progress or the global direction of manufacturing, the international community will reassess and reevaluate Chinese assets. 2) The emergence of risk boundaries and constraints, market anxiety fades away, expectations for revision are over, and the market returns to endogenous development logic. Recently, a new round of capital market reforms has accelerated, implying a policy stance that will consolidate the stability and improvement trend in the capital market. The clarity of the bottom, the rise of social asset management demand in the background of current risk-free returns, and the influx of incremental funds into the market. 3) In 2026, fiscal stimulus will lead to rising inflation, and traditional industries will gradually stabilize; facing huge market demand and a significant gap in computing power between China and the US, investment in China's emerging industries will also accelerate; in addition, China's competitive manufacturing industry is going global, with multinational companies emerging and ROE improving, with an expected upward revision in China's growth in 2026. The Chinese stock market is not about to stop, so keep the faith. Orient: Beware of geopolitical fluctuations, embrace the safety theme Last week, the situation in the Middle East continued to ease, but market pricing is also relatively ample, with international oil prices falling, US bond yields falling, and equity markets rebounding significantly. Looking ahead, there is still a possibility of geopolitical fluctuations, and the negative impact of high oil prices remains a concern. As various economic data is released in early May, the market will adjust its economic outlook. Rather than switching frequently in the disturbance of geopolitics, it is better to focus on the safety theme with stronger certainty in the medium term. Sinolink: Under different outcomes of geopolitical risks, energy may be a common beneficiary The development direction of the current Middle East geopolitical conflict still has a high degree of uncertainty, with conflicting statements from the US and Iran on key issues. There are two completely different paths for future scenarios: one is the gradual elimination of geopolitical risks as US-Iran negotiations progress; the second is a secondary escalation of the Middle East conflict, or a situation where inventory depletion fails to resolve supply chain issues, leading to increased tail risks. Under the first scenario, as supply chain disruptions gradually settle, the prosperity of the AI-driven technology sector can be sustained. Considering that overseas AI capital spending in the first quarter of 2026 is likely to continue to rise, the use of data centers will significantly increase power demand, but the growth of overseas energy and infrastructure investment in the past three years has not matched the growth of AI investment. The growth in the technology sector will also drive an increase in demand for energy-related physical assets, and a new round of HALO transactions may occur, bringing the market back into the rotation from technology to manufacturing and resources seen from last year to the first quarter of this year. Under the second scenario, given that the average global primary oil reserve level is equivalent to 45 days of daily consumption, the conflict period of the past month may have already consumed some inventory, and concerns about the global supply chain may re-emerge. At this time, traditional energy chain assets will be the market's only safe haven. It is worth noting that recent performance of bond yields in various countries is starting to show a negative correlation with energy independence, implying that after changes in inflation expectations, constraints on growth in various countries from an energy perspective will gradually emerge. This article is reprinted from "Tencent Self-selected Stocks", GMTEight Editor: Wang Qiujia.