Core Insights - The recent appreciation of the RMB, recovering above the 7.09 mark, is attributed to the weakening of the USD due to strong expectations of a Fed rate cut, alongside a significant increase in A-share buybacks, which have exceeded 130 billion yuan this year, indicating a recovery in market confidence [3][4] - The probability of a Fed rate cut in December has surged to 84.9%, driven by signs of a weakening labor market and expectations surrounding the new Fed chair selection, suggesting that a rate cut is highly likely [3][4] - The competition in the AI sector is intensifying, with companies like Nvidia and Google battling for market share, while Alibaba's Qianwen has secured a national AI project in Singapore, indicating a shift towards a more competitive landscape in AI technology [4] Currency and Market Dynamics - The appreciation of the RMB is supported by external factors such as the anticipated Fed rate cuts and a reduction in geopolitical uncertainties following positive communications between US and Chinese leaders [3][4] - A-share buybacks have reached a historical high, with over 100 companies seeing their stock prices double, reflecting a belief among companies that their stocks are undervalued [4] Investment Opportunities - Companies with high overseas business exposure and those holding USD assets are expected to benefit from the RMB appreciation [5] - High-dividend blue-chip stocks and quality growth stocks are likely to see valuation recovery in the context of anticipated rate cuts, with a focus on firms with solid cash flow and stable R&D investments [5] - The technology sector, particularly in AI and autonomous control, presents significant long-term potential, with emphasis on companies that possess core technologies and relevant application scenarios [5] Strategic Recommendations - Investors are advised to monitor sectors that benefit from currency appreciation and rate cuts, while also considering companies in the technology space that are involved in AI and robotics [5] - Companies with low valuations and buyback support, particularly in the food and beverage, chemical, and real estate sectors, should be placed on watchlists for potential investment as their fundamentals improve [5]

Core Viewpoint - The semiconductor equipment ETF (159516) has seen a significant increase of 9.55% in a single day and a total rise of 21.39% over the past five days, driven by short-term catalysts such as domestic lithography machine testing and Huawei's AI computing power announcement, which boosts semiconductor demand. However, the long-term trend is focused on domestic substitution in the semiconductor equipment sector, with potential breakthroughs expected in semiconductor manufacturing in the context of AI technology competition, suggesting investors should maintain attention on this sector [1][5]. Industry Insights - The investment logic in the semiconductor equipment industry is closely tied to domestic substitution and self-sufficiency, particularly in critical areas like lithography and etching machines, where the domestic production rate is below 20%. Chinese companies are making progress from zero to one in these areas, gradually replacing foreign manufacturers. Domestic wafer fabs are shifting from hoarding imported equipment to sourcing from local suppliers, with capital expenditure continuing to rise and orders transitioning from overseas giants to domestic firms, indicating a vast potential for domestic production and a significant volume-price increase effect [3]. Market Performance - Currently, the global semiconductor sales remain at a high peak, with July's sales showing a year-on-year growth of 20.6%. Overseas AI capital expenditure is expected to support the semiconductor industry's prosperity. On the policy front, domestic policies are focusing on supply chain security and self-sufficiency, reducing external dependencies and trade risks, and emphasizing "technology as the forefront" to promote modernization in China. Overall, the long-term logic for semiconductor equipment remains positive, and investors are encouraged to look for opportunities to buy the semiconductor equipment ETF (159516) on dips [5].

Market Overview - The A-share market showed strength today, with the Shanghai Composite Index rising by 0.83% to 3853.64 points, and the Shenzhen Component Index increasing by 1.80% [1] - The semiconductor industry chain remained strong, with significant gains in semiconductor equipment, chips, and related sectors [1] - The overall market sentiment is strong, with over 4400 stocks rising and less than 900 declining [1] Investment Strategy - The current market is driven more by sentiment and valuation, with a clear structural differentiation, particularly in the STAR Market [1] - Two potential future scenarios are identified: continued active micro liquidity leading to sustained market performance, or macroeconomic improvement allowing for broader market expansion [2][6] - Recommended focus on sectors supported by structural themes and fundamentals, such as chip ETFs and photovoltaic ETFs [1][6] Bond Market Insights - The ten-year government bond ETF fell by 0.16%, with a 5-day decline of 0.44%, reflecting a weak trend [2][6] - The core factors influencing bonds remain policy-driven, with the central bank maintaining a steady stance on liquidity [8] - Despite short-term pressures on the macro environment, there is a divergence between macro reality and expectations, impacting long-term bond performance [8] Semiconductor Sector - The semiconductor equipment ETF rose by 9.55% today, with a 5-day change of 21.39%, driven by events such as domestic lithography machine testing and AI demand from Huawei [9] - The long-term investment logic in the semiconductor sector focuses on domestic substitution and self-sufficiency, particularly in critical areas with low domestic production rates [12] - Global semiconductor sales increased by 20.6% year-on-year in July, supported by overseas AI capital expenditure [11] Economic Outlook - The domestic economy faces short-term pressure, but potential recovery in overseas demand due to the Federal Reserve's preventive rate cuts may benefit export-oriented sectors [5] - The current economic environment is seen as a normal outcome of "anti-involution" policies aimed at controlling supply-side expansion [5] - Key areas to watch include the progress of US-China tariff negotiations and domestic policy statements [4]