A-share midday review | A-shares have a strong start after the holiday! The Science and Technology Innovation 50 soared 8% in half a day, how to seize the opportunity in the "hard technology" market?

The ceasefire agreement between the US and Iran is temporarily maintained and there is no significant escalation in the situation, coupled with strong macroeconomic data from the United States, cooling down market risk aversion. On May 6th, the three major stock indexes in A-shares collectively opened higher in the morning session, with more stocks rising than falling, and over 4000 stocks rising. By midday closing, the Shanghai Composite Index rose by 1.27%, the Shenzhen Component Index rose by 2.57%, and the ChiNext Index surged by 3.29%, reaching a ten-year high. In addition, the Sci-Tech Innovation 50 Index surged by 8.25%, the ChiNext 50 Index rose by over 3%, and the BSE 50 Index rose by nearly 3%. The total trading volume in the Shanghai and Shenzhen markets in the first half of the day was 2.08 trillion yuan, an increase of 274.3 billion yuan from the previous trading day. On the market, the components of the Sci-Tech Innovation 50 continued to surge, with Hygon Information Technology up by the daily limit, and multiple stocks such as Cambricon rising by over 10%; CPU, AI chips, semiconductor, and storage chip concepts all surged, with several stocks including Jiangsu Eazytec Co., Ltd., Shenzhen Longsys Electronics, and Da Puwei hitting the daily limit; concepts like word element economy, domestication of computing power, and computing power leasing all strengthened, with Business-intelligence Of Oriental Nations Corporation, Guangdong Hec Technology Holding hitting the daily limit; hardware concepts like optical chips, optical modules, PCB, liquid cooling, and fiber optic cables all rose, with stocks like Grace Fabric Technology, Shenzhen Techwinsemi Technology hitting the daily limit; concepts like space computing power, satellite internet, and commercial aerospace continued to strengthen, with Western Metal Materials, Tongyu Communication Inc. hitting the daily limit; concepts like securities firms, internet finance, Byte Bean Bag, AI comics, and AI intelligent bodies all strengthened; aerospace industry chain, transformers, space photovoltaics, Siasun Robot & Automation, and power concepts all rose. In terms of declines, ST concept stocks experienced a wave of limit downs, with nearly 60 stocks hitting the limit, including multiple stocks like ST Xinyuan and ST Nando hitting the 20% limit down; the oil and gas industry chain, oil and gas pipelines, oilfield services, natural gas, and petroleum concepts were among the top decliners, with Zhongman Petroleum And Natural Gas Group Corp., Ltd. falling by over 6%; liquor, beer, duty-free shops, and consumer goods concepts all declined, with Wuliangye Yibin falling by nearly 5%; some chemical concepts like soda ash, urea, and coal chemical all declined; banking, tourism, aquaculture, agriculture, and other concepts showed weakness. Looking ahead, BOC International believes that A-shares may continue the upward trend in a stable manner after the holiday, focusing on two core themes of AI technology and resource energy security. Industrial also believes that with the effective mapping of global equity by US tech stocks during the holiday, combined with continued verification of high performance trends in relevant sectors in the first quarter, the domestic AI hardware industry chain is expected to continue to be a structural highlight in the post-holiday A-share performance. Sector Analysis 1. Storage chip concept strengthens collectively: Stocks like Shenzhen Techwinsemi Technology, Shenzhen Longsys Electronics, and Netac Technology hit the daily limit and reached historical highs. 2. Computing power leasing concept rises: Stocks like Guangdong Hec Technology Holding and Mcc Meili Cloud Computing Industry Investment hit the daily limit, with others like Hangzhou Anysoft Information Technology, Business-intelligence Of Oriental Nations Corporation, Shanghai Anoky Group, and Beijing Topnew Info&Tech following suit. 3. Commercial aerospace concept is active: Companies like Chongqing Zaisheng Technology Corp. hit the daily limit and continued to reach historical highs. 4. PCB concept strengthens: Companies like Grace Fabric Technology surged for 3 days in a row, while Sinoma Science & Technology and Xi'an Taijin New Energy & Materials Sci-Tech hit the daily limit. Institutional Views BOC International: External disturbances and internal support suggest focusing on "double main lines" after the holiday After the holiday, A-shares may continue the upward trend in a stable manner, focusing on two core themes of AI technology and resource energy security. The market is gradually shifting from geopolitical games to logic driven by profitability and policies. It is expected that after the holiday, the A-share market will maintain the upward trend in a stable manner. On one hand, first quarter A-share performance continues to recover, official PMI data continues to improve, providing support for profit. In addition, during the holiday, the performance of US stocks, Hong Kong stocks, and Chinese concept assets was positive; coupled with the high trading volume before the holiday, it indicates that the market's trading willingness is not weak. However, attention should also be paid to the potential impact of changes in overseas central bank policies and trade policies. In terms of allocation, technology and resources remain the two core themes. 1) AI technology industry chain: The AI sector of the US stock market continued to be strong during the holiday, with positive catalysts such as Apple's better-than-expected financial report and Intel's high growth in AI business. It is expected that there will be a significant emotional linkage in A-share's AI computing power and AI application related targets after the holiday. However, attention should be paid to internal structural differentiation, with the conversion from crowded segments at high levels to those with higher performance certainty in technology hardware and autonomous controllable chains. 2) Resources and energy security still have allocation value, and in the short term can act as core grasps against geopolitical and inflation risks, with the potential for a reevaluation of industrial and financial attributes in the medium term. The small metal sector performed well before the holiday, and during the holiday, the market continued to pay attention to changes in geopolitics and policy paths, so the resource sector is likely to continue to attract attention after the holiday. Huajin Securities: A-shares in May may oscillate slightly stronger As of now, A-shares in May may oscillate slightly stronger. (1) Policies in May may still be positive, and external risks may ease. Firstly, positive policies may continue to be introduced and implemented in domestic politics in May. Secondly, external risks may ease in May. (2) Economic and profit fundamentals in May may continue to improve. Firstly, the economy may continue to recover in May. Secondly, short-term corporate profits may continue to improve. (3) Liquidity in May may remain loose. Firstly, macro liquidity may remain loose in May. Secondly, capital inflow into the stock market in May may continue to increase. Industry allocation in May: continue to buy technology growth, some cyclical and consumer industries. Industrial: Domestic AI hardware industry chain expected to be a structural highlight For A-shares, with the effective mapping of global equity by US tech stocks during the holiday and continued confirmation of high growth trends in the relevant sectors in the first quarter, the domestically bound AI hardware industry chain (represented by optical communications and storage) is the most promising direction, which is expected to continue to be a structural highlight of the A-share performance after the holiday. This article is reprinted from "Tencent Choose Stocks", GMTEight Editor: Wang Qiujia.