A-share opening report | Shanghai Composite Index opened down 0.20% but turned positive, with the paper and biotechnology sectors leading the gains.

Opening Data On August 26, the Shanghai Composite Index opened down 0.20% at 3,881.74 points, the Shenzhen Component Index opened up 0.11% at 13,761.36 points, the ChiNext Index opened up 0.35% at 3,409.28 points, and the STAR Market 50 opened up 0.07% at 1,605.74 points. As of 9:31 AM, there were 2,761 stocks rising and 2,427 declining across the two markets and the Beijing Stock Exchange, with 362 stocks unchanged. Leading the gains were sectors such as paper, bio-products, other power supply equipment II, passenger vehicles, industrial metals, and automotive services; leading the declines were oil and petrochemicals, coal, media, textiles and apparel, public utilities, and transportation. Market Situation On August 26, the A-shares opened with a weak Shanghai and strong Shenzhen trend, with index divergence. The Shanghai Composite Index opened down 0.20% at 3,881.74 points, while the Shenzhen Component Index opened up 0.11%, the ChiNext Index opened up 0.35%, and the STAR Market 50 opened up 0.07%. As of 9:31 AM, 2,761 stocks were rising and 2,427 were falling, with the rise percentage around 50%, showing a relatively balanced long and short position. Influenced by the overnight significant drop in international oil prices, oil and petrochemicals and coal sectors led the decline among the Shenwan first-level industries; however, sectors such as paper, bio-products, passenger vehicles, and industrial metals performed strongly against the trend. Overnight News Brief U.S. stocks closed higher. International oil prices plummeted: On August 25, all three major U.S. stock indices closed higher, with the Dow Jones Industrial Average up 0.30%, the S&P 500 up 0.32%, and the Nasdaq up 0.66%. Nvidia rose 2.19%, ending its seven-day losing streak. The decline in WTI crude oil futures by 3.12% to $82.36 per barrel and Brent crude by 3.89% to $88.58 per barrel was impacted by the U.S. pivoting towards sanctions against Iran and the increased expectations of shipping resuming in the Strait of Hormuz. Central Bank MLF Continues with Reduced Amounts The overnight reverse repurchase forecast has been released: On August 25, the central bank conducted a 500 billion yuan one-year Medium-term Lending Facility (MLF) operation, maturing 600 billion yuan that month, resulting in a net withdrawal of 100 billion yuan. On August 24, the central bank announced that from August 27 to September 1, it would carry out overnight reverse repurchase operations, with a daily amount not exceeding 600 billion yuan. Intensive Disclosure of Mid-year Reports State-owned enterprises tackle 6G: On the evening of August 25, a series of mid-year reports were disclosed. Wus Printed Circuit reported a 73.72% year-on-year increase in net profit for the first half of the year, Jiangxi Copper's net profit rose by 106.77% year-on-year, and CMSC's net profit increased by 104.87% year-on-year. The State-owned Assets Supervision and Administration Commission held a meeting on August 20 to promote the future 6G industry by state-owned enterprises, focusing on technological breakthroughs and accelerating the move towards a commercial closed loop. Market Trend Analysis Today, the four major indices opened with divergence: the Shanghai Composite Index down 0.20%, while the Shenzhen Component Index, ChiNext Index, and STAR Market 50 opened slightly higher, showing a trend of weakness in Shanghai and strength in Shenzhen. The U.S. stock market rose overnight, with all major indices closing higher and Nvidia halting its seven-day decline, leading to a rebound in optical communication and memory sectors, which may boost the sentiment towards technology growth; however, the drop in international oil prices over 3% weighs on resource-heavy sectors like oil and petrochemicals and coal, dragging down the Shanghai Composite Index. The domestic central bank has conducted a 500 billion yuan MLF operation and announced arrangements for overnight reverse repurchase at the end of the month; the strong growth in performance for optical communication and PCB mid-year reports continues to support the fundamentals of the computing power industry chain. Institutional consensus leans towards the relatively dominant directions of electric power equipment exports and high demand in computing power, with no systemic negative feedback appearing in the capital market yet. Short-term resource sectors may be under pressure, while technology growth and pharmaceutical consumer sectors may remain relatively active, leading to continued fluctuations in the indices.