The broader market was volatile throughout the day, with all three major indexes falling slightly.
On the market, AI concept stocks rebounded, CPO, memory chips and other directions led the rise, Topway Information, Demingli up limit; PCB concept stocks rose sharply, Hongxin Electronics, Jin An Guoji rose to the limit. The real estate sector fluctuated strongly, and Jinke shares and Rongsheng Development rose to the limit. Robot concept stocks bottomed out, and Shuangfei shares, Aishida, Wuzhou New Year and other limit increases. Intelligent driving concept stocks strengthened at the end of the day, and Zhejiang Shibao and Ruima precision rose to the limit. In terms of sectors, PCB, memory chips, CPO, real estate and other sectors rose first.
In terms of decline, cyclical stocks such as rare earths fell into adjustment, and Longci Technology and zinc shares fell by more than 5%. Small metals, CRO, traditional Chinese medicine, rare earth permanent magnets and other sectors fell first. Overall, individual stocks fell more or less, and more than 2,700 stocks fell in the two markets.
By the close, the Shanghai Composite Index was down 0.54%, the Shenzhen Component Index was down 0.55%, and the ChiNext Index was down 0.91%. The trading volume of Shanghai and Shenzhen today was 819.8 billion, a decrease of 48 billion from the previous trading day. Northbound funds sold a net 1.344 billion yuan throughout the day, of which Shanghai Stock Connect sold 2.173 billion yuan and Shenzhen Stock Connect bought 829 million yuan.
AI quotes are making a comeback
Today's AI market is "making a comeback", the popularity of related concept sectors has increased greatly, and upstream hardware such as memory chips, CPOs, and optical modules have ushered in a rise. Among them, many popular stocks strengthened significantly, and the leading stock of computing power Topway Information was again limited, and the stock price also continued to hit a new high this year; Inspur Information, Hongbo Shares, Cambridge Technology and other early bull stocks also rose.
Based on market news, there are three major benefits for AI:
First, on July 4, the 2023 Global Digital Economy Conference opened in Beijing. Wang Jiangping, member of the leading party group and vice minister of the Ministry of Industry and Information Technology, attended the opening ceremony and delivered a speech, which mentioned that "enhance the momentum of digital development, accelerate the innovation and development of strategic emerging industries such as big data, artificial intelligence, and intelligent networked vehicles, vigorously develop advanced manufacturing, promote the digital economy to become stronger, better and bigger, and cultivate a new economic engine." In addition, the Huawei Developer Conference will be held tomorrow (July 7), and the HUAWEI CLOUD Pangu model will usher in a major upgrade.
Second, on the evening of July 5, the General Office of the Zhejiang Provincial Party Committee of the Communist Party of China and the General Office of the Zhejiang Provincial People's Government issued a notice on the Implementation Opinions on Promoting the High-quality Development of the Platform Economy. The "Opinions" pointed out that it is necessary to promote the construction of computing power infrastructure, optimize the layout of artificial intelligence computing power platforms, strengthen algorithm innovation and application, and build an algorithm transformation and application ecology.
Third, according to Huasheng Online News, the Ministry of Science and Technology recently approved to support the National Supercomputing Changsha Center of Hunan University to build a national new generation of artificial intelligence public computing power open innovation platform (preparation), which is the first national new generation of artificial intelligence public computing power open innovation platform approved in Hunan Province.
At present, AI is at the commanding heights of a new round of industrial transformation. In terms of scale, the scale of the global AI industry is expected to reach $150 billion in 2030, with a compound growth rate of about 40% in the next 8 years, and models, data and computing power are the troika for the development of artificial intelligence. Institutions are generally optimistic about the main line position of AI in the medium and long term.
However, from the perspective of the market as a whole, today continued yesterday's weak finishing structure, the three major indexes closed down again, individual stocks also fell more or less, and the volume could further shrink. It can be seen that the recovery of today's AI direction has not resonated with the index or short-term sentiment. At the same time, the application of games, media and other applications fell after the afternoon, and the AI sector still had a large amount of tight selling pressure to be resolved in the early stage, and the continuity of this round of AI rebound still needs to be investigated.
The market enters the mid-report window
In addition to the recovery of the AI market, today's A-share market also staged a wave of "medium report market".
Recently, some A-share companies have issued interim performance pre-increase announcements, and the stock prices of many of them have risen sharply, such as Chongqing Department Store, Gan Consulting, etc., and Lansheng shares, which have turned around losses in a larger way, have ushered in a word limit. On the contrary, the stock prices of pre-loss/pre-reduction stocks such as Zhixiang Jintai, Dongyue Silicon, LESER Information, and COSCO Shipping Holdings fell today.
It can be seen that performance is still the best touchstone.
In fact, the market entered July and officially entered the mid-report window. According to incomplete statistics, as of the morning of July 6, 111 companies have announced their first-half performance forecasts. The type of performance forecast shows that there are 76 pre-increase companies and 8 pre-profit companies, with a total proportion of 75.68%; There are 15 companies with pre-decline performance and 4 companies with pre-loss performance.
Among the companies with good performance, a total of 21 companies increased their net profit by more than 100% based on the median expected net profit growth; There are 28 companies with net profit growth rates between 50%~100%. Among them, Poly United is expected to increase the median net profit by more than 30 times, temporarily ranking the "pre-increase king"; Yuexin Health expects that the median net profit in the first half of the year will increase by more than 20 times year-on-year, temporarily ranking second; China Super Holdings expects the median net profit to increase by more than 7 times, temporarily ranking third.
From the perspective of the industry, the companies with good performance are mainly concentrated in auto parts, power equipment, medicine and biology, machinery and equipment and other industries. The recovery of the industry market, the increase in demand, the full recovery of the company's production and operation, the reduction of costs and efficiency, and the improvement of gross profit margin are the main reasons for the growth of the performance of many companies.
Looking forward, with the advent of the mid-report performance window in July and August, and the gradual development of the steady growth policy, Soochow Securities suggests that performance improvement can be paid attention to from three lines: first, industries with inflection points in profit growth; Second, switching industries may occur in the inventory stage; The third is the recovery of the medium economic index industry.
A-shares face a triple inflection point
Since the beginning of this year, the theme market has occupied a dominant position, and as the market continues to shrink and fluctuate downward recently, the market in the second half of the year has become more and more elusive. In the future, how will A shares be interpreted? Yang Delong, chief economist of Qianhai Open Source Fund, believes that the current market is in a stage of triple inflection point superposition, investors should strengthen confidence and seize opportunities by allocating good stocks and funds.
The first inflection point is the inflection point of economic growth.
In the first half of this year, economic growth showed a weak recovery trend, and a series of policies to stabilize economic growth may be gradually introduced in July, enhancing the strength of economic recovery, which is now an inflection point in economic growth. For the macro economy in the second half of the year, Tu Qiang, senior macro analyst of Shenwan Hongyuan Research, said that the third stage of the moderate upward economic "N-type recovery" is expected to begin. At present, policies need to consider not only "counter-cyclical adjustment" within the year, but also "cross-cyclical adjustment" within the year and next year. It is expected that the stage of more concentrated efforts of the steady growth policy is next year, and the Central Economic Work Conference in the fourth quarter may be deployed.
The second inflection point is the inflection point of the market.
Looking back at the rise of the market in the first half of this year, mainly relying on the two main lines of AI and "China Special Valuation", if the contribution of AI and the Chinese head sector is excluded, the price of many stocks in the first half of the year is actually below 2900 points. With a large number of individual stock valuations entering the bottom range, the bottoming recovery is worth looking forward to.
The third inflection point is the inflection point of style.
In the first half of this year, the market style was significantly differentiated, and most of the other sectors except AI and Zhongzitou fell, especially the track stocks with good performance such as new energy were deeply corrected. In the second half of the year, the market's money-making effect will further spread, investors will pay more attention to the performance of listed companies, and the market style will shift from speculation to speculation.
Finally, back to the A-share itself, the current risk premium of the total economic related assets is at the historical extreme level, the consensus expectation implies that the space for deep adjustment of the index is not high, with the initial exploration of the bottom of the index, Guotai Junan Securities believes that the A-share shock market will slowly rise, style switching or will appear in the fall, it is recommended to pay attention to three main lines of configuration:
Main line one: underestimating growth. Sectors with full stock price adjustment, bottoming out earnings expectations, medium-term cyclical recovery and domestic substitution: semiconductors/automation equipment/innovative drugs.
Main line 2: AI and digital economy industry growth spread to hardware and materials. Technological innovation breakthroughs and capital expenditure expansion bring about high certainty growth on the upstream infrastructure side, actively layout the computing power (optical chips/connectors/switches/liquid cooling/heat dissipation/ceramic shells/storage/PCBs, etc.) and the coordinated development of midstream and downstream hardware and applications (media/games/servers/information innovation software and hardware, etc.).
Main line 3: the new three-year action plan for national reform and the construction of the capital market system with Chinese characteristics, "special valuation + high dividend + industrial integration" both offensive and defensive: equipment manufacturing/energy/transportation.