Morning Review: The ChiNext Index surged nearly 5%, with the semiconductor sector leading the rally, and concepts like computing power remaining active.

In early trading on April 8, stocks in both markets saw a strong surge in market indexes; the Shanghai Composite rose by nearly 2%, while the ChiNext Index jumped nearly 5%, and about 5,000 stocks in the A-share market were in the green.

As of the midday close, the Shanghai Composite rose 1.92% to 3,964.72 points, the Shenzhen Component rose 3.87%, the ChiNext Index rose 4.81%, and the STAR Market Composite Index rose 4.53%. Trading volume across the three markets of Shanghai, Shenzhen, and Beijing totaled about 1.55 trillion yuan.

From the market performance, the oil sector saw a sharp drop, while the coal sector moved lower. Semiconductor, non-ferrous metals, insurance, steel, and brokerages rose, while areas such as computing power, the CPO concept, the gold concept, and AI application concepts were active.

Guotai Junan Securities said that the market structure at present is not a steady state. If the fighting escalates, the so-called resilient assets currently in place would also face a catch-up decline; if conditions ease, it may not be the best solution. In fact, the source of the current biggest shock is energy. Resolving the energy-related contradictions is what would truly make resilient assets. An increase in energy’s share of global GDP is a highly likely event.

Based on the information available, considering the combined expected value under the two scenarios, and adding expectations that the market could be optimistic, the following recommendations are made: 1) Global entry into an energy restocking cycle—new and old energy sources are expected to see a resonance together (oil, oil shipping, coal, lithium batteries, wind/solar, and energy storage); 2) After the U.S. dollar illusion gradually fades, the return of the financial attributes of commodities, together with a rebound in demand, for copper, aluminum, and gold; 3) Reassessment of China’s manufacturing: machinery and equipment, chemicals—when manufacturing in China becomes the global stabilizing anchor, the continued outperformance of exports beyond expectations and capital returning to the country will also bring new momentum to domestic demand that has been dormant for a long time. Look for structural opportunities that emerge after reversing factors that suppressed performance, such as tourism and scenic spots, seasoning and fermentation products, beer and other alcoholic beverages, pharmaceutical distribution, and medical aesthetics, among others.