The Shanghai Composite Index fell another 3,000 points
Edited by: Xiao Ruidong
On December 5, the three major indexes fluctuated downward, and the Shanghai Composite Index fell to 3,000 points again. The Shanghai Composite Index closed down 1.67% at 2,972.3 points, the Shenzhen Component Index fell 1.97% to 9,470.36 points, the ChiNext Index fell 1.98% to 1,871.1 points, the STAR 100 Index fell 1.70% to 1,059.33 points, and the Beijing Stock Exchange 50 rose 7.28%.
On December 5, the full-day market turnover was 837.9 billion yuan, and the actual net selling of northbound funds was 7.521 billion yuan, of which 4.894 billion yuan was net sold through Shanghai-Hong Kong Stock Connect and 2.627 billion yuan was net sold through Shenzhen-Hong Kong Stock Connect. In terms of industries, food and beverage led the gains, many stocks rose to the limit, the pharmaceutical industry was partially active, gold, real estate, coal, and liquor fell first, and the technology sector pulled back across the board.
Source: Wind
On December 5, the aquaculture sector rose against the market, but the aquaculture ETF (159865) finally lost to the pressure of the broader market and closed down 1.34%.
Source: Wind
The recession of the breeding sector has lasted for more than a year, and the current valuation of the sector is at a low position, and the financial pressure on the enterprise side has reached a high position.
Recently, activities such as pickling in the south and enemas in the north have been increasing slowly, and the slaughter volume has increased steadily. But on the other hand, the temperature does not drop quickly, the temperature in the south is still high, and the pickling has not yet opened in large quantities. On the basis of the peak season of pig prices, the market's perception of excess supply side has further fermented, and the main hog futures contracts have fallen sharply, and the main contract LH2401 has fallen nearly 15% in the past 10 trading days. At the end of November, the national breeding sow herd decreased by 2.82% month-on-month (the previous value was down 1.40%), and decreased by 5.69% year-on-year (the previous value was down 1.26%).
In 2023Q3, the average asset-liability ratio of the key 11 listed companies involved in the pig breeding business rose to 75.79%, the highest point since 2015. There has also been some deterioration in the current ratio. On the supply side, the completion of the group's slaughter this year is insufficient, and the year-end slaughter plan will be accelerated, and the slaughter will rise. The risk of disease has increased, and panic slaughter has increased. Considering the marginal changes in both ends of supply and demand, in the next six months, pig breeding is still facing continuous loss pressure, and it is expected that the cash flow of industry enterprises will be further tightened, or drive the accelerated elimination of production capacity.
The pessimistic statements of CDMO leaders continued to ferment, and the market's pessimism about the sovereign credit rating downgrade event continued to decline, and the innovative drug sector continued to fall on December 5. However, it should be noted that there are many subdivisions of biological drugs, and the new crown CDMO field is indeed suffering from the decline in prosperity, and preclinical CRO has been affected by the decline in demand or project delays caused by the global and especially domestic investment and financing recession, but there are still many biopharmaceutical subdivisions in the boom or upward trend, such as large and small molecule CDMO business, generic CXO, and clinical CRO.
In recent years, with the gradual maturity of life science technologies such as CGT, ADC, polyclonal antibodies, and peptides, and the emergence of large products such as GLP-1, emerging businesses and potential innovative drug products are expected to open the second growth curve of CXO. The commercialization of peptide drugs is imminent, and the CDMO space is broad. Domestic enterprises are mainly engaged in small molecule CDMO business, and the production capacity of large molecule CDMO is still catching up with overseas leaders. Benefiting from various policies such as consistency evaluation and centralized procurement, generic drug CXOs still maintain a high degree of activity. It is also necessary to pay attention to the changes in the positive factors of the entire pharmaceutical sector (the bottom of the policy is warming up + the impact of the high base is decreasing + the volume of innovative drugs). The 2023H1 CRO sector is greatly affected by the domestic and foreign investment and financing environment and unfavorable factors, and it is expected that the clinical CRO sector is expected to continue to grow rapidly as the unfavorable factors gradually subside.
At present, the layout of the pharmaceutical sector is still cost-effective, and the bottom area can continue to pay attention to biomedical ETF (512290), medical ETF (159828), vaccine ETF (159643), innovative drugs Shanghai-Shenzhen-Hong Kong ETF (517110) and other targets.
The gaming sector pulled back sharply on December 5, with the game ETF (516010) closing down 3.75%. The sector currently has a margin of safety and is showing signs of recovery on the fundamentals.
Source: Wind
The National Press and Publication Administration announced yesterday the November game version number, a total of 87 domestic online games have been approved, and 87 products have applied for mobile version numbers. Among them, 77 are mobile games (including 25 mobile-casual puzzle games), 7 mobile--client games, 2 mobile--browser games, and 1 mobile--client-Switch game.
According to the statistics of the Securities Times, many of the approved editions are from listed companies, including Zhongqingbao's "Contract Battle Song", "Ant Clan War", "Seal of Mitheus", ST Meisheng's "Finger Rescue" and "Lost Town", Perfect World's "Zhuxian 2", Gigabit's "Button Brothers", etc. Up to now, a total of 931 game versions (including 58 imported games) have been issued this year, which has exceeded the 579 in 2022 and 748 in 2021, approaching the 1,000 mark expected by institutions. The regular issuance of edition numbers will be conducive to promoting the orderly growth of the industry. (Mention of individual companies or products does not constitute an investment recommendation, the same below)
In addition, the combination with AIGC is still the focus of the market on the industry. Theoretically, AIGC can not only save the art and sound costs of game manufacturers, but also increase the user experience by improving the interaction ability of NPCs. Since the beginning of this year, NetEase Games has laid out its self-developed "Danqing" (graphic generation) and "Yuyan" (LLM) large models in "Against the Cold", and miHoYo has launched the "Memetic Resonance Machine", a diagram tool in "Star Iron". It can also be seen from the recruitment websites of major game manufacturers that they are currently stepping up the relevant layout of talents.
NetEase Game Technology Art Engineer Recruitment Instructions
Source: NetEase Games official website
In terms of industry fundamentals, it is expected that this year and next year will be in the trend of performance recovery and upward prosperity. According to gamma statistics, from January to August this year, the domestic game market will grow by 7.15% year-on-year, and the global game market will grow at a compound growth rate of 4.2% from 2024 to 2026. Interested investors can continue to pay attention to the related opportunities of the game ETF (516010).
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National Business Daily