A-share market closing review | Shanghai Composite Index slightly higher closing, continuous benefits from AI applications! Sector limit up trend.

Today's early market showed a slight differentiation, with the Shanghai Composite Index closing slightly higher, while the ChiNext Index showed weaker performance. The Spring Festival box office is heating up, coupled with the popularity of Seedance, leading to a new outbreak in the media sector. The market saw a total turnover of 2.1 trillion yuan for the day, a decrease of over one trillion yuan compared to the previous trading day, with more stocks falling than rising in the two markets. On the market front, there was a surge in limit-up stocks in the AI application sector, with areas such as film and television, short plays, ByteDance, corn economics, and multimodal all experiencing a collective surge. In terms of news, recent advancements in artificial intelligence applications continue to emerge, with ByteDance's AI video generation model Seedance 2.0 sweeping the Internet in a small-scale test phase; additionally, ByteDance's image generation model Seedream 5.0 targets Nano Banana Pro; Alibaba Thousand Questions launched a new generation image generation basic model Qwen-Image-2.0. In other hot spots, the biopharmaceutical sector saw a surge, with innovative drug stocks leading the way, and stocks like Wanbangde Pharmaceutical Holding Group hitting the limit-up. Stocks related to computing power continued their upward trend, with Dawei Technology (Guangdong) Group and Allied Machinery both seeing two consecutive days of limit-up. On the downside, retail and liquor consumption stocks saw adjustments, with Hangzhou Jiebai Group hitting the limit-down, and Gansu Huangtai Wine-Marketing Industry nearing the limit-down. In focus stocks, the new commercial aerospace stock Electric Blue Sky saw a maximum surge of 750% on its first day of listing, ultimately closing nearly 600% higher, with a total market value exceeding 110 billion yuan. The company's main business is the research, development, production, sales, and service of electric energy products and systems. The company's main products and services include aerospace power, special power, and new energy applications and services. Looking ahead, China Securities Co., Ltd. stated that due to the influence of the long holidays, the short-term bull-bear game is likely to be mild, with the market probably focusing on consolidation and oscillation. Guosen also mentioned that this current spring market may have further room for development, with short-term holding strategies potentially being relatively more advantageous. In terms of individual stocks, 2195 stocks rose in the two markets, while 3128 stocks fell, and 159 stocks remained unchanged. There were a total of 70 stocks hitting the limit-up and 12 stocks hitting the limit-down. As of the close, the Shanghai Composite Index rose by 0.13% to 4128.37 points, with a turnover of 882.2 billion yuan; the Shenzhen Component Index rose by 0.02% to 14210.63 points, with a turnover of 122.33 billion yuan. The ChiNext Index fell by 0.37% to 3320.54 points. Funds Flow Today, major funds focused on seizing opportunities in the film and television industry, publishing, digital media, and other sectors. Stocks with significant net inflows from major players included Beijing Enlight Media, Sungrow Power Supply, and Eoptolink Technology Inc., among others. Key News Recap 1. Ministry of Industry and Information Technology and five other departments: Strengthen construction of information and communication industry to support the development of low-altitude infrastructure The offices of the Ministry of Industry and Information Technology and five other departments issued the implementation opinions on strengthening the construction of the information and communication industry to support the development of low-altitude infrastructure. The document emphasizes the coordinated development of the information and communication industry and low-altitude equipment manufacturing industry, continuously improving the technical capabilities, industrial supply capabilities, network support capabilities, and security capabilities of the information and communication industry, orderly promoting the construction of low-altitude scenario communication networks, enriching and expanding perception technologies, assisting in improving navigation positioning accuracy, and supporting the construction of low-altitude intelligent network systems. 2. Involving 316 common drugs, the first to eighth batches of national centralized drug procurement continued to open bids According to the National Medical Insurance Administration, on February 9th, the new round of bidding for the first to eighth batches of national centralized drug procurement produced the proposed list of selected products. This round of continued procurement involves 316 common drugs from the first to eighth batches of national centralized procurement, covering 26 treatment areas such as anti-infection, anti-tumor, hypoglycemic, antihypertensive, lipid-lowering, nervous system, respiratory system, and digestive system. 51,000 medical institutions nationwide participated in the bidding, with 4,623 products from 1,091 domestic and foreign companies participating in the bidding, of which 4,163 products from 1,020 companies qualified for the proposed list. 3. Prices are expected to rise again! CHOW TAI FOOK plans price adjustments after the New Year, stores respond: fixed-price products may increase by 15%-30% Market reports suggest that CHOW TAI FOOK may adjust prices for gold products after the holiday season, drawing widespread attention from the industry and consumers. According to verification from CHOW TAI FOOK stores, the price adjustment is expected to officially start in mid-March, with some stores already receiving relevant notices. The focus of the price increase will be on fixed-price products, with an estimated increase of 15%-30%. However, the specific details of the price adjustment and execution time are subject to adjustments to store pricing labels. Market Predictions 1. China Securities Co., Ltd.: The small red envelope market before the Spring Festival may continue China Securities Co., Ltd. stated that influenced by the long holiday effect, the short-term bull-bear game is likely to be mild, with the market mainly consolidating and oscillating. Previously, major chips have been partially released in stages, and regulatory agencies have focused on stable operation before the holidays. Coupled with the expectation of boosting consumer spending during the Spring Festival, the policy outlook is generally favorable. On the overseas front, U.S. Treasury Secretary Bezent recently stated that the new U.S. chairman is unlikely to take swift action to shrink the balance sheet. It may take at least a year and a half, meaning that the probability of the Fed shrinking its balance sheet before the mid-term elections in 2027 is low. Combining current pricing, the market still expects the Fed to cut interest rates at least twice in 2026, with overall macro liquidity remaining ample. Overall, the index is expected to continue to oscillate around the holiday season, and some stocks previously misjudged due to chip movement will gradually recover in the next few days, potentially leading to a continuation of the small red envelope market before the Spring Festival. 2. Guosen: This current spring market may have further room for development, with short-term holding strategies potentially being relatively more advantageous Guosen stated that historically, the spring market in bull markets typically sees an increase of around 20% in indices. Since December 17, 2025, the maximum increase in the Shanghai Composite Index has been 9.8%, significantly lower than historical comparisons, indicating that there may still be further room for development in this current spring market. Short-term holding strategies may be relatively more advantageous. 3. Soochow: The week before the holiday is the best window for index layout According to a research report from Soochow, the week before the holiday is the best window for index layout, with a turnaround point often seen around the fifth day before the holiday. Looking back at Spring Festival market trends since 2006, after a period of consolidation, the indices typically start a trend reversal around five trading days before the holiday; in terms of the continuation of the rebound, the market usually sees a clear upward trend until around six days after the holiday, with the upward slope gradually slowing down. In terms of style, the reversal between large and small cap stocks around the Spring Festival is prominent. Historically, large cap stocks have outperformed small caps before the holiday, and growth stocks have generally outperformed value stocks; post-holiday, small and micro caps take the lead over large caps. The reversal effect between large and small cap styles is particularly significant. This article was republished from Tencent Stocks. Editor: Liu Jiayin.