A-share market review | Shanghai Composite Index rose 0.32%, ChiNext Index rose 1.49%, CPO, real estate, and liquor sectors all saw significant surges.

On August 12, the three major indexes of A-shares opened lower but rose throughout the day, closing collectively in the positive. The ChiNext Index and the Sci-Tech 50 Index led the gains, with both indexes rising over 1%. By the end of the trading day, the Shanghai Composite Index was up 0.32% at 3946.68 points; the Shenzhen Component Index rose 1.09% to 14414.43 points; the ChiNext Index was up 1.49% at 3602.08 points; the Sci-Tech 50 Index gained 1.61% to 1737.04 points; and the BSE 50 was up 0.23% at 1115.78 points. The total trading volume of the Shanghai and Shenzhen stock markets was approximately 2.15 trillion yuan (21,524.23 billion yuan), a decrease of about 168.6 billion yuan compared to the previous trading day. A total of 4,128 stocks rose while 1,280 fell, resulting in a profit effect of about 76%; 96 stocks hit the daily limit up, while none hit the limit down, indicating a broad market rise and a significant recovery in market sentiment. Sector-wise, CPO, optical modules, real estate, telecommunications, semiconductors, liquor, and optical fiber were among the top gainers; in contrast, sectors such as oil and gas, coal, oil and petrochemicals, energy equipment, and electricity saw the most significant declines, while film and TV and innovative pharmaceuticals continued their previous days strength. Driving Factors The market exhibited a repair pattern resonating with technology growth and low-positioned consumer spending: the three major indexes opened lower but rose collectively, with the ChiNext Index up 1.49% and the Sci-Tech 50 up 1.61% leading the way, while funds clearly directed towards AI hardware and low-positioned real estate consumption. The combined trading volume of the Shanghai and Shenzhen stock markets was about 2.15 trillion yuan, a decrease of about 168.6 billion yuan from the previous trading day, with 4,128 stocks rising and only 1,280 falling, while 96 reached the daily limit up and none hit limit down, displaying a broad rise in individual stocks and a noticeable warming of sentiment. However, under the backdrop of reduced trading volumes, funding was primarily characterized by sector rotations rather than incremental influx. CPO/optical module sectors saw a breakout, with news from TrendForce raising the global shipment growth rate expectation for AI servers from the top nine cloud service providers (CSP) for 2026 to nearly 31%, estimating total capital expenditure to grow about 90% to exceed 886.7 billion dollars, with visible orders for liquid cooling, advanced packaging, and 1.6T optical modules entering a longer visibility phase. The real estate sector was catalyzed by policy easing, with Beijing optimizing purchase limits and housing fund policies, combined with expectations for the "Golden September and Silver October" peak season, leading over a hundred cities nationwide to adjust their housing market policies. The U.S. July CPI data (with overall expectations at 3.4% year-on-year and core at 2.5% year-on-year) is set to be released tonight, and its strength or weakness will influence the expectations for the September interest rate cut and the performance of interest rate-sensitive growth chains such as AI computing power and semiconductors. Popular Sectors 1. CPO/Optical Modules: The sector saw an explosive performance throughout the day. Focuslight Technologies Inc. hit the daily limit up (20.00%), Yangtze Optical Electronic rose over 13%, and companies like PNC Process Systems and Tongding Interconnection Information also hit the daily limit up, while Suzhou Everbright Photonics and East Point saw significant increases. TrendForce released an AI server industry report, revising the expected annual growth rate for global shipments of AI servers from the nine major CSPs in 2026 from 28% to nearly 31%, with total capital expenditures growing approximately 90% and surpassing 886.7 billion dollars, and an expected further increase to 1.32 trillion dollars in 2027. The focus of AI investment has shifted from "piling up GPU quantities" to upgrading full-chain infrastructure, with increasing visibility for orders of liquid cooling, advanced packaging, HBM4, 1.6T optical modules, high-speed orthogonal PCBs, and cabinet power supplies, benefiting OEM, packaging and testing, as well as server assembly chains directly. 2. Real Estate: The sector continued to rise, with several stocks like Hangzhou Binjiang Real Estate Group, CCCG Urban Development Holding Group, and Risesun Real Estate Development hitting the daily limit up. In news, the Beijing Housing and Urban-Rural Development Commission and others jointly issued a notice reducing the required duration for social security or personal income tax payments for non-Beijing households purchasing commodity housing within the Fifth Ring Road from "2 years" to "1 year," and raised the maximum loan limit for couples housing funds to 3.4 million yuan. The traditional peak season for the real estate market, "Golden September and Silver October," is approaching, with over a hundred cities nationwide reportedly adjusting housing market policies, lowering the minimum down payment ratio for first-time homebuyers to generally 15% and for second homes to 25%, while maintaining low interest rates, with many regions implementing tax reductions on selling houses for purchasing new ones and offering interest subsidies. 3. Liquor: The concept showed active performance, with Jiangsu King's Luck Brewery Joint-Stock hitting the daily limit up (9.99%), as the low-positioned consumption sector attracted capital inflows during the rotational market alongside real estate and pharmaceuticals, forming the main recovery line of "drinking, taking medicine, and buying houses" for the day. 4. Film/Innovative Pharmaceuticals (continuing the previous day's strength): The film sector continued its strong performance from the previous day, with Beijing Jingxi Culture & Tourism achieving three consecutive limit-ups; the innovative pharmaceutical concept again gained strength, with Xinjiang Bai Hua Cun Pharma Tech achieving seven consecutive limit-ups, while Zhejiang Medicine and Delong Composite Energy Group hit the daily limit up, with the pharmaceutical sector continuing to attract capital after the high-tech sectors were realized. Adjusting Sectors Oil and gas, coal, and other cyclical sectors collectively adjusted: the oil and gas sector saw Sino Prima Gas Technology drop over 7%; the coal mining and processing sector saw Sundiro Holding decline over 9%. The oil and petrochemical, energy equipment, electricity, and motorcycle sectors also weakened simultaneously. These directions were primarily high-position cyclical varieties that had seen significant earlier increases; on the day, funding was clearly withdrawing, showing significant declines, forming a sharp contrast with technology growth and low-positioned consumption.