A-shares midday | The three major indices closed higher, with PCB and innovative drugs triggering a surge in the limit-up trend, over 3,000 stocks fell.

On August 7, the three major A-share indexes opened mixed, then fluctuated and rebounded, with the ChiNext Index leading the gains. By the close of the morning session, the Shanghai Composite Index was at 3919.51 points, up 0.49%, the Shenzhen Component Index was at 14295.08 points, up 1.31%, and the ChiNext Index was at 3577.20 points, up 1.75%. The Sci-Tech Innovation 50 Index was at 1718.59 points, up 1.02%. Across the entire market, 2353 stocks rose while 3046 fell; the trading volume in the Shanghai and Shenzhen stock markets for the half-day was 1.68 trillion yuan, down by 75.2 billion yuan from the previous trading day. Market Overview On the upside, the PCB concept surged across the board, with over a dozen constituent stocks hitting the daily limit. Innovative drugs and CRO concepts collectively strengthened, with multiple stocks hitting the limit. The rare earth permanent magnet concept was active, with China Rare Earth Resources And Technology hitting the daily limit; the 6G concept maintained strength, with Tongyu Communication Inc. achieving four limits in five days. On the downside, the information security concept experienced a collective adjustment; NSFOCUS Technologies Group and Renzihang both fell over 10%. The cross-border payment sector encountered turbulence, while the software development sector as a whole declined. Overall, the market showed a clear divergence in trends between indexes and individual stocks. Although the three major indexes collectively closed higher and the ChiNext Index rose over 1.7%, more than 3000 individual stocks still fell. Funds concentrated in a few high-prosperity sectors like electronics, pharmaceuticals, and communications, while sectors such as information security and software development faced profit-taking pressure. Popular Sectors 1. PCB Concept Surges Across the Board The PCB concept surged across the board, with Guangzhou Fangbang Electronics, Shenzhen Edadoc Technology, and Xian Taijin New Energy & Materials Sci-Tech hitting the daily limit of 20%. Baoding Technology achieved five limits in six days, Zhejiang Wazam New Materials achieved three limits in four days, Shenzhen Kinwong Electronic reached two consecutive limits, and over a dozen stocks, including Guangdong Ellington Electronics Technology, Bomin Electronics, Aoshikang Technology, Shengyi Technology, Jiangxi Redboard Technology, Nuode New Materials, and OK Science and Technology, also hit their limits. Commentary: On the news front, a Citi report noted that in August, the price of electronic cloth experienced the largest monthly increase of the year, with average prices for series 1080, 2116, and 7628 rising by 17% to 18%, leading to a cumulative increase for the year of 118% to 165%. Electronic cloth is a core reinforcing material for copper-clad laminates (CCL), and price increases are being transmitted along the "electronic cloth - copper-clad laminate - PCB" chain. Goldman Sachs simultaneously raised its forecasts for AI server PCBs and CCLs, projecting that by 2028, the market scale will reach 84 billion USD and 48 billion USD, respectively. Additionally, Nvidia's Rubin architecture is driving demand for AI computing hardware, further boosting the prosperity of the PCB upstream. 2. Innovative Drugs and CRO Concepts Strengthen Collectively Innovative drugs and CRO concepts strengthened collectively, with Bide Pharmatech, GemPharmatech, and Acrobiosystems hitting the daily limit of 20%. Xinjiang Bai Hua Cun Pharma Tech achieved four consecutive limits, while Asymchem Laboratories and Harbin Medisan Pharmaceutical reached two limits in four days. Harbin Pharmaceutical Group and Zhejiang Hisun Pharmaceutical hit their limits, and multiple stocks, including Novoprotein Scientific Inc., Porton Pharma Solutions, Shanghai Haoyuan Chemexpress, and Shanghai Medicilon Inc., rose over 10%. Commentary: On the news front, a Sinolink report pointed out that starting in 2023, the top 15 multinational pharmaceutical companies will invest approximately 200 billion USD annually in external collaborations. As of July 10, 2026, the external capital expenditure of this year's top 15 multinational pharmaceutical companies has reached 200.3 billion USD, close to 73.5% of the total amount for 2025. A high prosperity pattern in global pharmaceutical industry mergers and acquisitions has basically been established. Additionally, recent interim reports from several innovative pharmaceutical companies, including BeOne Medicines Ltd., REMEGEN, and INNOVENT BIO, exceeded expectations. WuXi AppTec's revenue in the first half of the year grew nearly 39% year-on-year, and the company significantly raised its full-year revenue guidance to 58.5 billion to 60.5 billion yuan, confirming a recovery in the industry's fundamentals. 3. Rare Earth Permanent Magnet Concept Shows Activity The rare earth permanent magnet concept showed activity, with China Rare Earth Resources And Technology and Grinm Advanced Materials hitting their limits. Zhejiang Zhongke Magnetic Industry rose over 9%, and JING JU LIN rose over 10%, with China Northern Rare Earth, China Rare Earth Nonferrous Metals, and Shenghe Resources Holding also following suit. Commentary: According to data from the China Rare Earth Resources And Technology industry association, the average price of praseodymium-neodymium oxide in July was 758,913 yuan/ton, an increase of approximately 6.57% month-on-month. In the first half of 2026, the average price of praseodymium-neodymium oxide was 731,000 yuan/ton, a significant year-on-year increase of 73.6%. On the supply side, data from the General Administration of Customs shows that the import volume of rare earth ore in May decreased by 44.4% year-on-year, while the production of recycled oxides shrank by 19.5% month-on-month, further expanding the supply-demand gap and supporting the maintenance of high rare earth prices. 4. 6G Concept Maintains Strong Momentum The 6G concept maintains strong momentum, with Tongyu Communication Inc. achieving four limits in five days, Wuhan Fingu Electronic Technology reaching two consecutive limits, and GHT Co., Ltd. rising over 10%. Guangdong Shenglu Telecommunication Tech., Jiangsu Cai Qin Technology, Shenzhen Sunway Communication, and Jiangsu Allfavor Intelligent Circuits Technology also followed suit. Commentary: On the news front, according to the Science and Technology Innovation Board Daily, Nvidia is accelerating its entry into the telecommunications operator market and is seeking base station manufacturers in China to develop 6G base stations that meet overseas market requirements. Tongyu Communication Inc. previously announced that its stake in Jiaxian Communication is based on Nvidia's CUDA Aerial open-source ecosystem platform for the development of 6G AI-RAN base station technology, and it has not yet signed any R&D cooperation agreements or strategic cooperation framework agreements with Nvidia.