A-share market midday report | The ChiNext Index rose 0.82% in half a day! How to respond to the style change from "drinking and drug use" to "embracing computing power"?

On April 17, the three major indexes of A-shares showed mixed movements, with the Shanghai Composite Index weakly fluctuating and the ChiNext Index rising by over 1% during intraday trading. By the midday close, the Shanghai Composite Index fell by 0.3%, the Shenzhen Component Index rose by 0.33%, and the ChiNext Index rose by 0.82%, reaching a new high in nearly 11 years. The total turnover of the Shanghai and Shenzhen stock markets in the morning session was 1.58 trillion yuan, an increase of 118.6 billion yuan from the previous trading day. It is worth noting that there is a shift in market style with a comparison between the "new king" and the "old god." Yuanjie Semiconductor Technology continued to strengthen during trading, with its stock price breaking through 1410 yuan, surpassing Kweichow Moutai to become the new "stock king" of A-shares. Since September 24, 2024, Kweichow Moutai has accumulated a nearly 20% increase, while Yuanjie Semiconductor Technology has accumulated a nearly 1500% increase. "Stock god" Kweichow Moutai fell by over 4% after releasing its annual report for 2025, showing a decline in annual revenue and net profit for the first time since its listing. In terms of market performance, the market style is divided, with "technology newcomers" like Yuanjie Semiconductor Technology and Zhongji Innolight rising, while traditional sectors like "drinking and medicine" showing weaker performance. Hardware stocks such as optical modules, copper foils, PCBs, and fiber optic cables collectively rose, with several stocks hitting the daily limit, including Cig Shanghai and Shenzhen Everbest Machinery Industry. Zhongji Innolight reached a new historical high again, while Yuanjie Semiconductor Technology's stock price surpassed Maotai to become the new "stock king" of A-shares. Chip stocks like lithography machines, storage chips, and advanced packaging also rose, with Wuhan DR Laser Technology Corp. and TDG Holding hitting the daily limit. The concept of computing power leasing was active again, with Jiangsu Lettall Electronic hitting the daily limit. The battery industry chain was strong again, with Shandong Sacred Sun Power Sources hitting the daily limit. The real estate sector surged at one point, with companies like Metro Land Corporation hitting the daily limit. Sectors like non-ferrous metals, 6G, wind power, photovoltaics, and consumer electronics all showed some performance. On the downside, pharmaceutical stocks continued to decline, with sectors like pharmaceutical commerce, traditional Chinese medicine, weight-loss drugs, and CRO leading the way. The oilfield services sector declined again, with Xinjiang Zhundong Petroleum Technology leading the losses. The tourism and hotel, pork, liquor, and other consumer concept sectors showed weak performance, with Kweichow Moutai falling by over 4%. Chemical stocks fluctuated lower, with Jiangsu Yangnong Chemical experiencing a significant drop. Concepts like gaming and virtual humans in AI applications underwent adjustments, with Shanghai Wondertek Software hitting the daily limit. Sectors like coal, agriculture, and the automotive industry chain were mostly in the red. Looking ahead, Yao Pei, chief strategy analyst at Huachun Securities, stated that this round is not a rebound but a counterattack, with the key being optimism about profit recovery under positive PPI. Meng Lei, China stock strategy analyst at UBS Securities, expressed optimism about growth and cyclical styles in the medium term, as the profit recovery and narrowing PPI declines are expected to drive the outperformance of cyclical stocks. Popular sectors: 1. Hardware stocks such as computing power collectively rose, with companies like Cig Shanghai and Shenzhen Everbest Machinery Industry hitting the daily limit, and Zhongji Innolight reaching a new historical high. 2. The battery industry chain showed repeated activity, with Shandong Sacred Sun Power Sources hitting a continuous streak of gains. 3. Minor metal concepts were strong, with companies like Zhuzhou Smelter Group and Huludao Zinc Industry leading the way. 4. The computing power leasing concept rebounded, with companies like Jiangsu Lettall Electronic hitting the daily limit. Institutional views: - Huachun Securities: This round is a counterattack, not a rebound, driven by optimism about profit recovery under positive PPI. - UBS Securities: A-share company profits are entering an upturn cycle, with high performance realization in the technology sector. - CITIC SEC: The surge in Token calls due to applications like Agent & multimodal is causing a shortage of computing power, with domestic chips accelerating breakthroughs in inference, presenting opportunities for growth in the industry chain.