A-share midday review | The three major indexes have a slight adjustment, with bank stocks rising and liquor sector rebounding.

On June 18th, the A-share market showed weak fluctuations in the morning, with over 4100 stocks trading lower. By the midday close, the Shanghai Composite Index fell by 0.20%, the Shenzhen Component Index fell by 0.15%, and the ChiNext Index fell by 0.36%. In terms of market sentiment, the market continued to show weakness, with sector themes across the board trending lower. Military electronics, arms integration, and AVIC concepts all showed strong performance, with several stocks hitting the limit up. AI hardware concepts such as PCB, optical modules, and high-speed copper cables also strengthened, with multiple stocks hitting the limit up. The digital currency concept was partially active, with some stocks hitting the limit up. Liquor concepts rebounded, and the nuclear pollution prevention and control concept remained strong. Banking, consumer electronics, and oil were among the few sectors showing strength. On the downside, pharmaceutical concepts such as CRO, innovative drugs, and generic drugs continued to decline. The rare earth concept experienced a pullback, with Zhejiang Zhongke Magnetic Industry falling by over 10%. New consumer concepts like beauty care, medical beauty, and grain economy all trended lower. Cultural media, short dramas, and gaming concepts all showed a collective downturn. Brokerages, insurance, and internet finance concepts experienced a pullback. Real estate and automotive industry chains collectively declined. Consumer concepts like food and beverages, dairy, and retail continued to show weakness. Concepts like solid-state batteries, humanoid Siasun Robot & Automation, and computing power all trended lower. Looking ahead, Huaxi believes that the A-share market's rally is still underway, focusing on the 6.18 Shanghai Lujiazui Finance & Trade Zone Development Forum. Hot Sectors: 1. Liquor sector rebounds The liquor sector saw a rebound, with Gansu Huangtai Wine-Marketing Industry hitting the limit up, and several other companies rising. Analysis: On the news front, People.cn Co., Ltd published an article stating that in some areas during the crackdown on illegal consumption, there exists the phenomenon of "layered escalation," equating "prohibition of illegal consumption" with "prohibition of consumption," which is seen as bureaucratic and formalistic, affecting businesses and people's livelihoods. 2. Strong performance of AI glasses concepts The AI glasses concept continued to show strength, with Impulse(Qingdao)Health Tech hitting the limit up, and other related companies rising. Analysis: Meta officially announced a partnership with the sports brand Oakley to launch a new model of AI glasses. The industry is transitioning from the management stage to the sales stage. 3. Rise of stablecoin concepts Concepts like stablecoins and digital currencies saw a rise, with GCL Energy Technology hitting a four-day limit up and other related companies rising. Analysis: The U.S. Senate passed a stablecoin bill, establishing a regulatory framework for stablecoins, filling a legal gap. As a result, the stock price of Circle, the "first stock of stablecoins" in the U.S., surged after trading hours. Institutional Views: 1. Huaxi: Focus on the 6.18 Shanghai Lujiazui Finance & Trade Zone Development Forum, A-share market rally still in progress. Huaxi believes that the A-share market rally is still ongoing, with recent progress in China-U.S. London negotiations meeting market expectations. However, the situation in the Middle East has once again disrupted global risk appetite, leading to short-term volatility in A-shares. Geopolitical events have a more emotional short-term impact domestically, and the core factors affecting A-shares remain structural issues. The risk premium on the Shanghai and Shenzhen 300 index has fallen to the lowest level since April, further improvement in risk appetite will require sustained efforts in economic fundamentals or incremental policies. The 6.18 Shanghai Lujiazui Finance & Trade Zone Development Forum will be an important policy observation window. During the forum, central financial authorities will announce significant financial policies, which investors are positively anticipating, potentially supporting market risk appetite and boosting A-share stability and growth. 2. China Galaxy: Focus on the pace of incremental policy implementation amidst external disturbances. China Galaxy believes that in the short term, pressure on the external trade environment is easing, but geopolitical conflicts are once again impacting market risk appetite. The Shanghai Lujiazui Finance & Trade Zone Development Forum on June 18-19 will announce significant financial policies, focusing on the pace of implementation of the next round of incremental policies. In the short term, the A-share market is likely to maintain a volatile trend, with a focus on structural opportunities. Looking ahead, increased external uncertainties will continue to be a major challenge for the fundamentals, but with sustained policy efforts, the domestic economy is expected to demonstrate strong resilience. Under the expansion of equity mutual funds, long-term capital inflows, and policy support, A-share liquidity may continue to stabilize in a positive direction. The trend of accelerating resident wealth re-allocation to financial assets is becoming clearer, with a focus on the recovery pace of market sentiment. 3. EB SECURITIES: Market currently dominated by stock game, focus on telecommunications sector. EB SECURITIES believes that looking ahead, the market is currently dominated by the stock game, and without significant unexpected positive stimuli, the trend of recent "index fluctuations and hot spot rotations" is likely to continue. Direction: Communications concept. The 2025 MWC Shanghai Mobile Communications Conference will be held from June 18 to 20, gathering operators, manufacturers, solution providers, and the Chinese Internet of Things ecosystem, potentially fueling speculation in related concepts. This article is reprinted from "Tencent Stocks Selection", edited by Wang Qiujia.