A-share market opening express | A-share collectively opened low, Shanghai Composite Index fell 1.09%, storage chip and other sectors leading the decline.

On July 16th, the three major A-share stock indices collectively opened lower, with the Shanghai Composite Index falling by 1.09% and the ChiNext Index falling by 2.48%. On the market, sectors such as storage chips, semiconductors, CPO, optical fibers, and energy metals led the declines. Institutional views on the future market: Soochow: The factor of capital remains the core variable disturbing the market, and they suggest focusing on leading stocks with strong performance certainty. Soochow believes that the recent style rebalancing in the A-share market is essentially a capital correction triggered by internal trading congestion and external market volatility resonance. They state that the industry logic has not fundamentally changed. Until the end of July, when overseas cloud companies disclose financial reports and capital spending guidance, the factor of capital will remain the core variable disturbing the market. In terms of allocation, they recommend prioritizing leading stocks in the overseas computing power industry chain with strong performance certainty and valuation advantage. These types of stocks still have advantages in risk-return ratio in the medium-term, and investors can moderately extend their holding period to mitigate short-term disturbances. Orient: The Shanghai Composite Index still has room to rise, and the high point this week is expected to be around 3970 points. Orient states that influenced by the overseas technology stock sentiment, the A-share market has entered a period of intense volatility. After the weakness in the semiconductor sector, the pharmaceutical sector is rising at the right time. The number of pharmaceutical stocks hitting the limit up or with an increase of over 10% reached 21, with Joinn Laboratories opening at the limit up and the innovation drug ETF soaring nearly 6% at one point. An interesting phenomenon is that as the market becomes more volatile, retail investors, usually seen as representing small single funds, tend to buy more; meaning that while institutional investors are controlling positions and realizing profits, retail investors are not amplifying panic sentiment, but instead continue to play a role as a "stabilizer" in the market. From a technical analysis perspective, the Shanghai Composite Index still has room to rise, with the high point this week expected to be around 3970 points. Founder: Continuing to balance against high volatility, with a focus on the independent industry logic of innovative pharmaceuticals. Founder believes that the core contradiction in the market is still "overseas sentiment disturbance + internal switching of high and low themes," rather than deteriorating domestic fundamentals. Funds are shifting from crowded computing hardware and aerospace defense to low-priced cyclical blue chips, confirming the style rebalancing characteristic of the transition from "liquidity-driven" to "performance-driven" in July. In terms of allocation, they continue to balance against high volatility: focusing on high-dividend low-valuation blue chips as a solid foundation, with a focus on the independent industry logic of innovative pharmaceuticals, and exercising caution towards high-tech hardware at high levels, while waiting for low-entry opportunities after volume stabilization. This article is reprinted from "Tencent Stock Picks", GMTEight editor: Feng Qiuyi.