Chinese A-shares witnessed a long-awaited surge in trading volume today, with the Shanghai Composite Index (SCI) rising by more than 1% at one point, and the ChiNext Index surging nearly 4% during the session; the total turnover of the two markets hit a one-month high; Hong Kong stocks also strengthened, with the Hang Seng Index (HSI) reclaiming the 18,000 point mark during the session, and the Hang Seng Technology Index rising nearly 3%.

Specifically, the main stock indices of the two markets rose strongly during the session, with the Shenzhen Component Index and the ChiNext Index showing particularly robust performance. By the close, the SCI was up 0.68% at 2,842.21 points, the Shenzhen Component Index was up 2.38% at 8,348.48 points, the ChiNext Index was up 2.53% at 1,580.46 points, and the combined turnover of the two markets was 876.6 billion yuan, an increase of nearly 27 billion yuan from the previous day.

Nearly 4,700 stocks turned red in the market, boosted by a positive news item, the real estate sector soared, with Gemdale Corporation's stock hitting the daily limit, and Tefa Service's stock rising by more than 10%, while Vanke A's stock briefly hit the daily limit; the securities sector rose, with China Galaxy's stock hitting the daily limit, and CICC's stock rising by more than 4%; the Huawei HiSilicon concept was active, with Shenzhen Huaqiang achieving 11 consecutive board gains in 12 days, accumulating a nearly 200% increase; the smart wearable concept was eye-catching, with Fenda Technology achieving 3 consecutive board gains, and Koson Technology achieving 5 consecutive daily limits; the online gaming concept rose in the afternoon, with Starway Entertainment's stock hitting the daily limit, and Huayi Brothers' stock rising by more than 15%; the banking sector continued to adjust, with Bank of Communications' stock falling by about 6%, China Construction Bank's stock falling by nearly 5%, and both Agricultural Bank of China and Industrial and Commercial Bank of China's stocks falling by about 4%.

Advertisement

Hong Kong stocks also rose significantly, with the Hang Seng Technology Index rising by more than 4% at one point. By the close, the HSI was up 1.14% at 17,989.07 points, and the Hang Seng Technology Index was up 2.87% at 3,560.61 points. In terms of individual stocks, NIO's stock rose by nearly 11%, XPeng Motors and Li Auto's stocks rose by about 8%, Oriental Selection's stock rose by more than 7%, and China Life's stock rose by more than 5%; China Merchants Bank's stock fell by more than 4%, and ICBC's stock fell by nearly 3%.

Real Estate Sector Eruption

The real estate sector soared across the board today, with Tefa Service's stock rising by more than 10% by the close, Gemdale Corporation and Tiandi Source's stocks hitting the daily limit, Vanke A's stock rising by more than 8%, and briefly hitting the daily limit during the session.

Hong Kong-listed mainland real estate stocks also rose, with Jingrui Holdings' stock rising by more than 60% by the close, Vanke Enterprises and Sunac China's stocks rising by nearly 10%, and Country Garden Services' stock rising by about 8%.

Today, there were market rumors that relevant parties are considering further reducing the interest rates on existing mortgages, allowing the existing mortgage pool of up to 38 trillion yuan to seek mortgage refinancing, in order to reduce the debt burden on residents and stimulate consumption. According to the relevant plan, existing mortgage customers can renegotiate mortgage interest rates with banks without waiting until January next year (the usual time for interest rate adjustments). However, this rumor has not yet been officially confirmed.

In addition, the Ministry of Housing and Urban-Rural Development recently proposed key tasks for building a new model for real estate development, one of which is to study and establish a housing health check, housing pension fund, and housing insurance system, to build a long-term mechanism for the safety management of housing throughout its life cycle. Currently, 22 cities including Shanghai are piloting, and personal accounts already exist through the payment of special maintenance funds for residential buildings. The focus of this pilot is for the government to establish relevant public accounts.

Huafu Securities believes that establishing a housing pension fund system is beneficial for providing a more stable source of funds for the renovation of old residential areas, providing safety guarantees for housing throughout its life cycle, and thereby improving the quality of residents' living conditions and stabilizing housing prices. Under the structural recovery of existing home sales and second-hand home sales, the stabilization of housing prices is expected to gradually spread from the second-hand home market to the new home market. Against the backdrop of global liquidity improvement and continuous relaxation of real estate policies, it is recommended to pay attention to leading real estate developers.Securities Firms Sector Rises

The securities firms sector saw a strong intraday lift, with China Galaxy hitting the daily limit up, Huaxin Shares surging nearly 8%, and Guotai Junan, Guo Tou Capital, and CICC all rising over 4% by the close.

In terms of industry developments, Guosen Securities recently announced its intention to acquire 53.0892% of Wanhe Securities, gaining control and initiating a wave of mergers and acquisitions under the same actual controller. This also signals an acceleration in the consolidation process of securities firms.

Guotai Junan Securities stated that the catalysts to watch for the sector moving forward are twofold: first, the recovery of market activity; and second, the accelerated progress of supply-side structural reforms within the sector. Mergers and acquisitions among securities firms, especially among top-tier firms, remain a focal point. At the current juncture, the sector still offers a high cost-performance ratio and odds, and subsequent industry investments should focus on the catalysts brought about by changes in market style and the acceleration of mergers and acquisitions.

The insurance sector also rose, with Tianmao Group hitting the daily limit up, New China Life Insurance nearing the daily limit up, China Pacific Insurance increasing nearly 7%, and Ping An Insurance rising over 3%.

Online Gaming Concept Active

The online gaming concept quickly gained momentum in the afternoon, with Star辉 Entertainment achieving a "20cm" daily limit up, Huayi Brothers surging over 15%, Jiayun Technology and Zhongqingbao increasing over 10%, and Caesar Culture also hitting the daily limit up, with Kingnet Technology rising nearly 4%.

Industry-wise, the China Game Industry Report for January-June 2024 indicates that the actual sales revenue of the domestic gaming market in the first half of this year has reached 147.267 billion yuan, a year-on-year increase of 2.08%, with a gaming user base of 674 million people. On August 20, the domestic game "Black Myth: Wukong" was launched globally, quickly topping sales charts on multiple platforms and trending on Weibo with multiple related topics. Data shows that "Black Myth: Wukong" broke 2.2 million concurrent players. Game Science announced that by the evening of August 23, "Black Myth: Wukong" had sold over 10 million copies across all platforms.

AVIC Securities pointed out that against the backdrop of a stable and rising gaming market and favorable gaming policies, the National Press and Publication Administration has accelerated the approval of domestic game licenses. The National Development and Reform Commission and other departments issued a notice on "Measures to Create New Consumer Scenarios and Cultivate New Growth Points in Consumption." With the support of multiple policies encouraging cultural and entertainment consumption, the industry supply side will show a trend of diversified growth, and the gaming industry may be on the verge of a new round of growth. The popularity of "Black Myth: Wukong" validates the product capabilities of domestic AAA games, coupled with AI enhancing game production efficiency and shortening game production time, accelerating the process of game intelligence, which is beneficial for the long-term development of the gaming industry. The gaming sector's performance and valuation are both expected to improve, offering continuous opportunities for investment in the sector.