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The news that many places have suspended the vaccination of Sanofi influenza vaccine and Longi Green Energy has raised prices has set off a fire in the vaccine and photovoltaic sectors.

On August 27, the market continued to fluctuate and diverge, with all three major stock indexes falling. On the market, industries such as games, chemical pharmaceuticals, biological products, medical devices, and coal performed well, while consumer electronics, lithium batteries, photovoltaic equipment, real estate, wind power equipment, and aerospace fell.

Bio-vaccine stocks rose strongly in the early trading session. On the news front, Sanofi, one of the world's largest influenza vaccine suppliers, decided to temporarily stop the supply and sales of influenza vaccines in China. The photovoltaic sector rose sharply during the trading session due to the price increase of the leading company Longi Green Energy.

It is worth mentioning that CSI 1000ETF collectively increased its trading volume before the midday closing. Currently, the trading volume of Southern CSI 1000ETF (512100) and Huaxia CSI 1000ETF (159845) exceeded 500 million yuan, and the trading volume of GF CSI 1000ETF (560010) and Fuguo CSI 1000ETF (159629) exceeded 200 million yuan. Among them, the trading volume of Huaxia CSI 1000ETF (159845) has exceeded the whole day yesterday.

In terms of Hong Kong stocks, affected by the sharp drop of Pinduoduo, Hong Kong Internet stocks generally fell, Alibaba and JD.com fell by more than 4%, Meituan fell by 3%. Tencent Holdings performed better than other Internet companies with the support of buybacks.

Flu vaccine stocks perform strongly

Influenza vaccine stocks performed strongly today. As of press time, Jindik and Hualan Vaccine achieved a 20% daily limit, followed by CanSino Biologics, Kanghua Biologics, and Beike Biopharmaceuticals.

On the morning of August 27, market news said that private medical institutions such as United Family Healthcare and Jiahui Healthcare have suspended the vaccination of Sanofi's Pasteur influenza vaccine, involving trivalent and quadrivalent vaccines.

In response, Sanofi said that influenza vaccine products themselves are highly complex. During the ongoing stability study, Sanofi observed that the potency (reference data related to the expected biological effect of the vaccine) of the influenza vaccines Valeline and Valeja for the 2024-2025 influenza season showed a downward trend. It is expected that the efficacy of the vaccine may be affected before the end of the product's validity period. As a precautionary measure, Sanofi decided to temporarily suspend the supply and sale of these vaccines in China.

Sanofi said that the influenza vaccines Valeline and Valga, which have been launched and circulated this year, have been approved for marketing, strictly abide by various laws and regulations, national drug standards and various statutory requirements, and meet the release standards. No signs and evidence of product safety and effectiveness have been found. The decision to temporarily suspend the supply and sale of these vaccines in China is only a precautionary measure.

In addition to Sanofi, domestic influenza vaccines include Beike Bio, Hualan Vaccine, Sinovac Biotech, China National Biotec Group, and Jindik, etc. Influenced by the above news, Hualan Vaccine and Jindik, etc., saw significant increases.

The leader of the photovoltaic industry announced a price increase

Longi Green Energy, the leader in the domestic photovoltaic industry, announced on August 26 that it would increase the price of silicon wafers, which will be implemented on August 29.

Stimulated by the above news, the A-share photovoltaic sector rebounded rapidly during the trading session on August 27. The industry index rose sharply after falling by more than 2%, and once reversed to positive. As of press time, King Kong Photovoltaic rose by more than 12%, Dico shares rose by more than 10%, Xinzhu shares hit the daily limit, Qingyuan shares rose by more than 4%, Longi Green Energy rose by more than 2%, and TCL Zhonghuan and Tongwei shares followed suit.

Specifically, LONGi Green Energy announced that it would begin communicating with customers about the silicon wafer price increase from August 26. The specific adjustment range is that the price of N-G10L products will increase from 1.06-1.08 yuan to 1.15 yuan, and the price of N-G12R products will increase from 1.2-1.23 yuan to 1.3 yuan. The new price will be officially implemented on August 29.

In the photovoltaic sector, against the backdrop of "global demand growth declining year-on-year in 2024 + rapid supply release", the prices of major products quickly fell below the cash costs of companies in the main industry chain in the first half of the year. By mid-2024, companies in the main industry chain will enter a stage of full cash loss. Huaan Securities believes that considering the cash flow situation, the photovoltaic sector may have reached the end of the downward cycle.

Huaan Securities said that the negative impact of the sector is currently well recognized and fully responded to by the market, including prices falling below corporate cash costs, declining capacity utilization, delayed or suspended projects, and the inability of most companies' cash flow to support losses in the long term. At present, the photovoltaic sector is more concerned about the stabilization and rebound of β. Production scheduling, demand, clearance, price exploration, etc. are all stimulus points for subsequent market conditions, and subsequent positive impacts of the sector will gradually accumulate. Crossing the cycle will test the company's cash flow and cost advantages.

Stable high-dividend assets are favored again

As the market continued to fluctuate and fall this year, stable high-dividend assets continued to be favored by investors. Today, stable high-dividend assets such as oil, coal, and banks rose again.

In the oil sector, CNOOC Development rose more than 6%, Sinopec and PetroChina rose more than 3%, and China National Offshore Oil Corporation rose 2%.

In the coal sector, Haohua Energy rose by more than 8%, Baotailong and China Shenhua rose by more than 2%.

In fact, the A-share high dividend strategy has continued to outperform the market since 2021, and its relative price advantage over the risk-free interest rate has been increased by funds with low risk preferences. Huaxi Securities believes that the fund heavy holdings index has continued to adjust since 2022. Correspondingly, the scale of newly issued funds has dropped significantly, and it is still at a "freezing point" so far, and public funds are weak in entering the market. During this period, domestic real estate market pressures gradually emerged, inflation levels declined, and high-profit growth sectors in the A-share market gradually became scarce. Against the backdrop of a downward trend in 10-year treasury bond interest rates and a shortage of asset allocation, high-dividend assets such as Chinese-character stocks and dividend indexes have shown "bond-like" allocation value and have attracted the attention of allocation-type incremental funds. In addition, the complexity of the overseas political environment and frequent geopolitical conflicts in recent years have also prompted the preference of existing funds to shift to low-risk assets, and the policy orientation of the capital market has also strengthened the high dividend trend.

Looking ahead, Huaxi Securities believes that there is still room for domestic interest rate cuts in the second half of the year, and the upward trend of short-term risk-free interest rates may have limited impact on A-shares. Overseas, with the US election approaching in November, relations between major powers may disturb market sentiment, while the Chinese-character and high-dividend sectors have a good safety margin. From the perspective of dividend yield spread, the current spread of the CSI dividend yield relative to the 10-year treasury bond yield is still at a relatively high historical level, and in a period of increased volatility in the bond market, high-dividend assets are an important allocation direction for long-term funds.