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In the morning trading today, A-shares continued to fluctuate and adjust, with the Science and Technology Innovation 50 Index falling by more than 2%, and major stock indices such as the Shenzhen Component Index and the ChiNext Index also falling by more than 1%. More stocks fell than rose in the two markets, and trading volume showed a trend of further shrinking.

On the market, public transportation, ST, banking, environmental protection and other sectors led the gains, while nonferrous metals, daily chemical products, semiconductors, and 100-yuan stocks led the losses.

Screenshot from: Wind

01

ST stocks rebounded against the trend

In the morning, ST stocks rose against the trend, and the sector index rose by more than 1%.

Individual stocks triggered a surge in daily limit prices, with more than 30 stocks including ST Lingda, ST Huke, and ST Molong hitting the daily limit or rising by more than 5%.

Among them, ST Chuntian had 9 consecutive daily limits, *ST Renle and *ST Longjin both had 8 daily limits in 9 days, ST Infinova had 5 daily limits in 6 days, and *ST Boxin had 6 consecutive daily limits.

Since the beginning of this year, ST stocks have continued to fall sharply. As of today's midday close, among the 143 ST stocks (excluding those that have been delisted), only 4 stocks have recorded an increase this year, and the rest have suffered heavy losses, among which *ST Baoli, *ST Chaohua, ST Changkang, *ST Meishang, etc. have all plummeted by more than 90%, and the median decline is as high as more than 52%.

In order to avoid delisting, ST stocks have launched self-rescue measures such as restructuring and repurchase.

As *ST Renle announced a few days ago, it plans to transfer 100% of the equity of 14 subsidiaries (grandchildren) and the company and its subsidiaries' corresponding claims against 13 of the target companies with operating stores through public listing.

*ST Renle stated that if this listing and transfer can be successfully implemented, it will be conducive to improving the financial and operating conditions of the listed company. The 14 target companies will no longer be included in the consolidated financial statements of the listed company, and the business structure and asset structure of the listed company will be optimized. After obtaining cash flow, the company will focus more financial, human, material and other resources on operations in advantageous areas, which can enhance the company's core competitiveness and promote the overall efficiency of the company.

ST Chuntian, which has had its stock price hit the daily limit for nine consecutive days, also announced recently that from April 18 to July 17, it spent a total of 33.7411 million yuan to repurchase 14.7038 million shares, with an average repurchase cost of 2.29 yuan per share.

However, when ST stocks rebound sharply, investors should be cautious about chasing the rise and carefully study whether the fundamentals of the relevant companies have changed substantially. For example, *ST Renle has been losing money for three consecutive years, and continued to lose 132 million yuan in the first quarter of this year, and its main business income also fell by 38.94% year-on-year. It is expected that the performance loss in the first half of the year will be 260 million to 300 million yuan.

Data from the Dragon and Tiger List shows that in the past three months, the business departments under Oriental Fortune Securities have been extremely active in the transactions of *ST Renle, with five business departments appearing on the list a total of 26 times.

According to Wind data, as of today's midday close, a total of 94 ST stocks have released their 2024 semi-annual performance forecasts, of which only 10 are expected to turn losses around in their semi-annual reports, and 4 are expected to increase their earnings. Other ST stocks continue to be mired in losses, with an expected profit rate of less than 15% and an expected loss rate of up to 85%.

02‍

Environmental protection stocks collectively strengthened

Environmental protection stocks collectively strengthened in the morning, and sub-sectors such as sand control, garbage sorting, automobile dismantling, energy conservation, and carbon neutrality all rose against the trend.

Jinmo Technology hit the 20% daily limit in just 8 minutes after opening, Zhongfutong also hit the 20cm limit during intraday trading, and Huakong Sage also hit the daily limit from the green in just 10 minutes.

Recently, the Ministry of Ecology and Environment released the "National Carbon Market Development Report (2024)", which mentioned that in the next step, the Chinese government will continue to improve the relevant policy supporting system of the national carbon emission trading market, comprehensively consider the industry's carbon emission level, data quality foundation, pollution reduction and carbon reduction coordination, high-quality development of the industry and other factors, and promote the carbon emission trading market in stages and steps to cover more key industries.

The report also emphasizes the need to actively develop a national voluntary greenhouse gas emission reduction trading market with high-quality carbon credits, build a scientific, reasonable, open, transparent and widely participated institutional system, focus on supporting the development of ecosystem carbon sinks, renewable energy, methane emission control, energy conservation and efficiency improvement projects, promote the application of low-carbon, zero-carbon and negative carbon technologies, explore the use of information technology to strengthen data quality management, and promote the widespread application of certified voluntary emission reductions.

Huatai Securities said that the water and solid waste industries are becoming more mature and gradually entering a period of stable operation. Operating companies are deepening their presence in the stock market, with capital expenditures declining year by year, and free cash flow is expected to improve, with significant high dividend characteristics. At the same time, some companies are expected to benefit from the increase in water fees and the expansion of the industrial chain, and their performance is expected to continue to grow.

Editor: Chen Lixiang

Proofreading: Yang Lilin