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On July 16, all three major indexes closed in the green. The Shanghai Composite Index closed up 2.29 points, or 0.08%, at 2976.3 points; the Shenzhen Component Index closed up 75.4 points, or 0.86%, at 8877.02 points; and the ChiNext Index closed up 23.33 points, or 1.39%, at 1696.34 points.

The trading volume of the Shanghai and Shenzhen stock markets today was 640.7 billion, an increase of 38.6 billion from the previous trading day. In terms of individual stocks, the number of stocks that rose exceeded 2,400.

Most industry sectors rose rather than fell, AI chip concept stocks soared, precious metals, complete vehicles, electronic components, semiconductors, automotive services, and consumer electronics sectors led the gains, while the fertilizer industry, beauty care, insurance, and cultural media led the declines.

Before looking at today's market, let's talk about the hot event after the market last night: the release of the Shanghai Composite Total Return Index.

On July 15, the Shanghai Stock Exchange and China Securities Index Co., Ltd. jointly issued an announcement. In order to facilitate investors to observe the overall returns of the Shanghai securities market, the Shanghai Stock Exchange and China Securities Index Co., Ltd. decided to officially release the real-time quotes of the Shanghai Composite Total Return Index from July 29, 2024, and at the same time adjust the index code and abbreviation to "000888" and "Shanghai Stock Return" respectively. The index is a derivative index of the Shanghai Composite Index. It is composed of samples of eligible stocks and depositary receipts listed on the Shanghai Stock Exchange, and the sample dividends are included in the index returns, reflecting the overall performance of listed companies on the Shanghai Stock Exchange after the dividend income is included. It takes July 21, 2020 as the base date and 3320.89 points as the base point.

For many years, the 3,000-point mark of the Shanghai Composite Index has always been an important psychological barrier for investors. From the perspective of constituent stocks, there is no shortage of high-dividend stocks with excellent performance in the Shanghai Composite Index. Therefore, regarding the release of the Shanghai Composite Yield Index, an investor commented on Snowball: "The change in the compilation method of the Shanghai Composite Index will reflect the real money-making effect. The index that is no longer ex-dividend is much better than the current index. A good index rise and fall data will attract more funds to enter the stock market. Not everyone knows the difference between dividends and no dividends. They only know that the Shanghai Composite Index will be 3,000 points in 10 years."

But today's Shanghai Composite Index remained calm. The Shenzhen Component Index and the ChiNext Index both rose well, but the Shanghai Composite Index only rose by 0.08%.

After reading the index news, let’s take a look at the most popular sector on the market today: the consumer electronics sector.

Last night, Apple's U.S. stock rose 1.67%, and its share price hit a new record high. Recently, Morgan Stanley analyst Erik Woodring raised Apple's target price from $216 to $273. He said that Apple Intelligence has the potential to drive a record number of device upgrades, and iPhone shipments will approach 500 million in the next two years, higher than the record-breaking upgrade cycle in 2021-2022.

Boosted by the news, A-share Apple industry chain stocks surged today. The A-share Apple Index (884116) rose 2.88%, Xinwangda hit the daily limit of 20cm, Dongshan Precision surged 9.33%, and Derun Electronics and Goertek also surged.

However, the logic behind the rise of individual stocks in the Apple industry chain is not simply following the trend of US stocks. More importantly, during this year's mid-year report window, many listed companies gave brilliant performance forecasts.

As shown in the 2024 first-half performance forecast released by Goertek, a leading "Apple supply chain" company on July 14, the company expects to achieve an attributable net profit of 1.181 billion to 1.265 billion yuan in the first half of this year, a year-on-year increase of 180% to 200%; the non-net profit is expected to be 1.146 billion to 1.234 billion yuan, a year-on-year increase of 160% to 180%.

Goertek Co., Ltd. stated that during the reporting period, under the company's business orientation of strengthening lean operations and improving profitability, the profitability of its smart acoustic equipment and smart hardware businesses improved.

In this regard, many analysts have expressed their affirmation of Goertek's performance growth. Dongwu Securities pointed out that Goertek's interim report forecast exceeded expectations and its profitability improved significantly. With the recovery of shipments of various terminal products and the optimization of product structure, profitability is expected to continue to improve.

Guotai Junan Securities said that many domestic chip design companies have announced earnings forecasts, the global semiconductor industry has recovered, and the high growth trend in the Chinese market has continued. Considering that the third quarter is the peak season for consumer electronics, the performance of downstream companies in the Apple industry chain, digital SoC companies, downstream storage companies, and downstream server companies are optimistic.

In addition to the consumer electronics sector today, the recently popular autonomous driving sector remains strong as a whole, but there has been differentiation among individual stocks.

According to media reports, Shanghai's driverless taxis will start public testing within a week at the earliest. At that time, users who have obtained the test qualification can place orders on their mobile phones and get them on call. The first batch of taxis has been put in place in Lingang.

Influenced by this good news, the driverless driving sector continued to rise sharply. Jinjiang Online rose for six consecutive days, Railwei 20cm rose for two consecutive days, Volkswagen Transportation rose by the daily limit, and many stocks such as StarNet Yuda, Zhongwei Electronics, Haowen Auto and Huace Navigation rose.

However, some other driverless concept stocks that were hyped up in the early stage suffered a correction. In particular, Tianmai Technology fell 6.66% on the day. Previously, starting from July 8, Tianmai Technology's maximum increase in the range of just 6 trading days exceeded 90%.

Tianmai Technology's decline this time is related to the abnormal trading announcement released last night. In the announcement, Tianmai Technology clearly stated that the company has noticed that the market has recently paid close attention to concepts related to driverless driving and "Carrot Run" online car-hailing, and pointed out that "the company's current business is mainly based on technologies such as the Internet of Vehicles to provide digital solutions for operation and management of urban public transportation. It does not have driverless body control and algorithm-related products, and has not carried out relevant cooperation with Baidu Carrot Run."

The direct clarification that there is no cooperation with Luobokuaipao has an obvious suppressive effect on the stock price. On the other hand, listed companies such as Jinjiang Online and Dazhong Transportation have also reminded investors to pay attention to the uncertainty and other risks of future business development related to driverless cars in recent stock price fluctuation announcements. However, the announcement clearly stated that it is directly related to the driverless business, which has boosted investors' short-term sentiment. The following is a screenshot of Jinjiang Online's announcement last night:

Finally, let’s take a look at the joys and sorrows of today’s market.

On July 16, the Saudi ETFs under Huatai-PineBridge and China Southern Fund were listed on the Shanghai Stock Exchange and Shenzhen Stock Exchange respectively. The two Saudi ETFs are among the first domestic funds that can invest in the Saudi Arabian market. They mainly track the FTSE Saudi Arabia Index in the form of ETF cross-listing. They rose sharply on the first day of listing and closed at the daily limit.

Saudi Arabia is the largest economy in the Middle East, the world's largest oil exporter and the second largest oil producer and reserve country. It is known worldwide for its resource endowment as the "Kingdom of Black Gold". In addition, the overall performance of the Saudi stock market has a low correlation with other major capital markets in the world, and occupies an important position in the current global diversified and decentralized asset allocation pattern. The long-term performance of the FTSE Saudi Arabia Index is outstanding. As of July 11, 2024, the index has accumulated a 31.72% increase since 2021, significantly outperforming the FTSE Emerging Markets Index.

Tianfeng Securities Research Report pointed out that the core investment value of the Saudi Arabian Stock Index lies in its rare beta of "real asset country + developing country + stable exchange rate fluctuations" among global stock indices. The Saudi Arabian Stock Index has a significant additive effect on the asset portfolio of Chinese investors, not only improving the portfolio's alpha, Sharpe and other return indicators, but also hedging volatility and exchange rate risks.

Netizens' comments were even more powerful: "Everyone is speculating on Saudi Arabia, and the Nasdaq ETF has no volume." The investors who subscribed to the Saudi ETF "won a lot."

However, investors who still held China Guanghui Auto at the close felt like they had been shortchanged.

Today is the 19th trading day since Guanghui Auto closed below 1 yuan on June 20. In the fierce game, Guanghui Auto rose to 0.99 yuan during the trading session, but finally could not withstand the surging selling orders and closed at the limit down, with a closing price of 0.87 yuan.

In other words, even if Guanghui Auto hits its daily limit tomorrow, it will only close at 0.96 yuan, which basically locks in the final outcome of "delisting at par value".

Investment is risky, independent judgment is important

This article is for reference only and does not constitute a basis for buying or selling. You should bear the risks of entering the market at your own risk.

Cover image source: Daily Economic News, photo by Liu Guomei

Reporter Wang Yandan, editor Ye Feng

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