A-share market review | The Shanghai Composite Index closed up 1.65%, with semiconductor stocks surging across the board. Semiconductor Manufacturing International Corporation (688981.SH) soared 13%, surpassing Maotai in market value.

Today, the three major indexes of A shares hit bottom and rebounded, with a collective increase in the afternoon. Both the Shanghai Composite Index and the Growth Enterprise Market Index rose above 4000 points, with the Sci-Tech 50 Index rising by about 8%. The total turnover of the two cities for the whole day was 2.9 trillion, more than 320 billion higher than the previous trading day, with the overall trend of the two cities being more down than up. In terms of the market, today's semiconductor stocks surged across the board, with the Longxin concept, storage chips, advanced packaging, semiconductor materials, and equipment sectors all showing strength. Semiconductor Manufacturing International Corporation's A-shares total market value surpassed Kweichow Moutai, rising by about 14% intraday. Hua Hong Grace Semiconductor rose nearly 11% to a historic high. It is reported that the strong performance of the semiconductor sector may be related to the following positive factors: First, the World Artificial Intelligence Conference and the High-Level Forum on Global Governance of Artificial Intelligence will be held from July 17 to 20; Second, the official launch of the National Supercomputing Internet Core Node; Third, Longxin Technology is about to go public; In other hotspots, the CPO concept rebounded after shaking in the afternoon, with Suzhou Everbright Photonics rising by over 10%, and other companies in the industry following suit. The biopharmaceutical concept surged again, with Chongqing Pharscin Pharmaceutical hitting the limit up, and Shaanxi Panlong Pharmaceutical Group and others rapidly rising. The PCB concept showed strength, with Baoding Technology hitting the limit up, and Shengyi Technology, Nanya New Material Technology following suit. The oil and gas concept continued to be strong, with Tong Petrotech Corp. rising by over 17% and Shandong Molong Petroleum Machinery hitting the limit up. In terms of declines, the non-ferrous metal sector fell across the board, with Xinjiang Baodi Mining leading the way; the lithium battery industry continued its decline, with CCMaterials clarifying the "breakthrough in solid-state battery technology" essay, narrowing the decline to 6%, after hitting the limit down earlier; Siasun Robot & Automation, the PEEK concept showed weak trends; ultra-high voltage, chemical industry, and photovoltaic sectors continued to adjust. The Goldman Sachs research team recently released a report titled "Trading Ideas: Bullish on the Chinese AI Value Chain." The report's author, analyst Louis Miller, wrote: "Chinese AI has officially entered our field of vision." Looking at individual stocks, a total of 75 stocks hit the limit up, while 15 stocks hit the limit down. There were 2486 gainers and 2888 decliners in the two cities, with 155 stocks maintaining their gains. At the close, the two cities rose, with the Shanghai Composite Index up 1.65% to 4036.59 points, with a turnover of 1.3642 trillion yuan; the Shenzhen Component Index rose 3.07% to 15398.73 points, with a turnover of 1.5351 trillion yuan. The ChiNext Index rose by 4.49% to 4018.17 points. Looking ahead to the future, EB SECURITIES believes that the sentiment in the A-share market remains cautious. The current stock game characteristics are prominent, continuing to restrict the short-term market trend. As second-quarter earnings announcements enter their peak period, the logic of "performance determines win or loss" is becoming increasingly evident. Capital flows Today, major funds focused on semiconductor, communication equipment, and component industries; funds flowed out of the battery, industrial metals, minor metals, photovoltaic equipment, and power grid equipment industries. News Review 1. Stable growth in the new energy vehicle market in the first half of this year The latest data released by the China Association of Automobile Manufacturers today (9th) shows that from January to June this year, the production and sales of new energy vehicles in the Chinese automobile market have shown a stable growth trend. The production and sales of new energy vehicles reached 7.438 million and 7.446 million units respectively, an increase of 6.7% and 7.3% year-on-year; in June, the sales of new energy vehicles reached nearly 60% of total new vehicle sales. 2. Electrolyte leader Guangzhou Tinci Materials Technology responds to the essay "Breakthrough in Solid-State Battery Technology": Limited impact in five years A summary of the "Solid-State Battery Technology Exchange Meeting" has been widely circulated in the investment circle, with the next-generation solid-state battery technology expected to fully replace traditional lithium battery materials such as electrolytes and separators, and even suggesting that the electrolyte industry may be "completely eliminated" and materials such as separators may be replaced. "We don't think that's the case." The secretary of the board of directors of Guangzhou Tinci Materials Technology explicitly denied the argument that solid-state batteries would disrupt the market in a phone interview. It stated that the sales volume and application scenarios of liquid batteries were still very good each year. 3. The National Essential Drug List is updated and adjusted, with 68 new chemical drugs and biologics added Experts introduced that this update of the National Essential Drug List includes the addition of 68 new chemical drugs and biologics, focusing on high prevalence chronic diseases and common diseases, such as adding 5 types of diabetes medications, 4 types of hypertension medications, 7 types of chronic obstructive pulmonary disease medications, and 8 types of common gastrointestinal disease medications, among others. Market outlook 1. EB SECURITIES: The characteristics of the stock game are prominent, continuing to restrict the short-term market trend EB SECURITIES believes that the sentiment in the A-share market remains cautious. The characteristics of the stock game are prominent, continuing to restrict the short-term market trend. Looking ahead, as second-quarter earnings announcements enter their peak period, the logic of "performance determines win or loss" is becoming increasingly evident. With the volatility transmission of the overseas tech sector, the completion of high valuations in the tech race is not yet finished, and the likelihood of more subpar earnings in the following quarter, the market sentiment remains cautious, with short-term trends likely to continue to be dominated by shrinking volume and structural differentiation. As funds increasingly focus on the certainty of earnings verification, tech growth and defensive themes supported by earnings, such as computing power leasing, semiconductor equipment, AI servers, and precious metals are active against the trend. Several concept stocks in computing power and semiconductor have announced earnings forecasts for multiples of growth, verifying the high prosperity of the sector; the sharp rebound in international oil prices supports the oil and gas sector; in addition, the policy expectations for building a strong tourism nation boost the repair expectations of the cultural and tourism sector. However, overall, during the earnings verification period, fund risk appetite is low, still focusing on subsectors with high earnings growth but stagnant prices. 2. CICC Securities: The short-term style rebalancing trend weakens, and the wait-and-see sentiment increases CICC Securities believes that overall, A-shares are currently in a downtrend. Low-level sectors that had previously shown some movement, such as innovation drugs, securities firms, consumer stocks, Siasun Robot & Automation, etc., have not performed well, indicating a weakening trend in style rebalancing and an increase in wait-and-see sentiment. Looking ahead, it is advisable to maintain a cautious approach in the short term, suggesting to be more patient and control positions reasonably, observing positive signals in the market. Such as stabilization and rebound of core global tech assets or the emergence of a high-volume long positive trend in A shares could increase participation. After the market warms up, it is possible to participate again in the rotational market cycle during the style rebalancing process. In the medium term, July is in a transitional period for the market, and significant fluctuations are expected. The main recommendation is to focus on balanced allocation. 3. Orient Securities: K-shaped short-term disturbances, temporarily balanced configuration Orient Securities believes that with short-term disturbances in the K-shape, the configuration is temporarily balanced. Since July, with news of Apple's price hike, Meta's lease, Blackstone's sale, the AI sector has been disrupted at the expectation level but not enough to form a turning point in expectations. At the same time, June PMI data in China exceeded expectations, and the Fed's interest rate hike expectations shifted, leading to simultaneous style diffusion domestically and internationally. On the one hand, there are expectations of converging K-shaped differentiation domestically; on the other hand, with the release of US non-farm payrolls data and dovish statements, cyclic sectors previously suppressed by high-interest rates in the US began to recover. The convergence of K-shaped differentiation will not happen overnight, and the short term is more about disruptions. There are still uncertainties in overseas interest rate expectations in the third quarter. Therefore, stocks are temporarily balanced, and short-term configurations can be made through a dumbbell strategy. This article is a repost from "Tencent Self-selected Stocks," GMTEight Editor: Liu Jiayin.