A-shares kick off the Year of the Horse with a bang: over 4,000 stocks in the green, with precious metals and oil & petrochemical sectors surging.

A-shares today ushered in a Year of the Horse opening rally. By the close, the Shanghai Composite rose 0.87%, closing at 4,117.41 points; the Shenzhen Component Index increased 1.36%, closing at 14,291.57 points; and the ChiNext Index gained 0.99%, closing at 3,308.26 points. The combined trading volume of the Shanghai, Shenzhen, and Beijing markets reached 2.2184 trillion yuan, up 219.3 billion yuan from the previous trading day.

Most industry sectors closed higher, with precious metals, oil and petrochemicals, glass fiber, agrochemical products, chemical raw materials, and non-metallic materials leading gains. The biggest declines were in film and television cinemas, media, tourism and scenic spots, and software development.

In individual stocks, over 4,000 stocks rose, with more than 100 hitting the daily limit. The precious metals and oil and petrochemical sectors surged, with Tongyuan Petroleum hitting the 20-cent limit, and stocks like Hunan Silver, China Oil Engineering, Zhun Oil, Zhongman Petroleum, and CNOOC Services also hitting the limit.

Today’s Highlights

U.S. considers new tariffs on about six industries citing “national security”

On the 23rd, U.S. media reported that the U.S. government is considering imposing a new round of tariffs on about six industries on the grounds of “national security.” Sources say the proposed tariffs may cover sectors such as large batteries, cast iron and iron fittings, plastic pipes, industrial chemicals, and power grid and telecommunications equipment. These new tariffs will be implemented separately from the recent announcement of a 15% global tariff measure.

Ministry of Commerce: 20 Japanese entities added to export control list

The Ministry of Commerce announced that Mitsubishi Shipbuilding Co., Ltd., Mitsubishi Heavy Industries Aerospace Engines Co., Ltd., and 18 other Japanese entities have been added to the export control list. This move aims to safeguard national security and interests, and to fulfill international obligations such as non-proliferation. The announcement takes effect immediately upon release.

Gold prices return to $5,200! Precious metals surge collectively, optimistic outlook for 2026?

Market consensus indicates that gold and silver have recently strengthened again, closely linked to rising market risk aversion. This is mainly driven by two factors: first, tariff issues; second, geopolitical tensions.

Geopolitical tensions and tariff disruptions spark a surge in oil and gas stocks, with many concept stocks gaining additional funding this year

On the news front, international crude oil markets rebounded strongly during the Spring Festival holiday, with Brent crude futures rising over 5% and U.S. WTI crude futures up over 4%. Fluctuations in U.S.-Iran relations and sudden changes in U.S. trade policies are key factors influencing oil prices.

Institutional Views

CITIC Securities: Post-holiday spring market expected to continue

February marks an important turning point. The leap in AI coding capabilities has pushed the global effective code volume into exponential growth, while the total physical production value and income growth are lagging behind the expansion of AI-generated code under current physical AI technology conditions. The world is likely to experience a phase of code expansion, excess execution capacity, intensified competition, and reduced capital returns. Based on industry dependence and regulatory/emotional barriers, industries can be classified into four categories: impacted (low physical dependence, low barriers), reshaped (low dependence, high barriers), fortified (high dependence, high barriers), and benefiting (high physical dependence, low barriers). In the near future, the gap in returns between beneficiaries of physical scarcity and those harmed by code expansion may widen further, and this divergence trend will continue. This is a new factor that must be considered when analyzing market trends and sector allocations. In the short term, the A-share industry landscape is dominated by manufacturing and finance, which are less affected by the current AI wave compared to U.S. and Hong Kong markets. Capital inflows and investor optimism remain unchanged, and the spring market after the holiday is expected to continue, with price increases remaining a key investment theme for Q1.

CITIC Construction Investment: A-shares likely to enter a new upward phase

During the Spring Festival, global stock markets performed strongly overall, with no major risk events. Market sentiment remains high, and A-shares are expected to start a new upward cycle after the holiday. Sector allocation continues to focus on two main themes: “Technology + Resources.” The technology theme centers on AI, humanoid robots, new energy, and innovative drugs; the resource theme focuses on precious metals, oil and petrochemicals, and basic chemicals. Key sectors include semiconductors, AI (optical communication, liquid cooling, electronic fabrics, high-end copper foil), machinery, non-ferrous metals, oil and petrochemicals, basic chemicals, power equipment (energy storage, ultra-high voltage, photovoltaics, solid-state batteries), and innovative drugs.

Shenwan Hongyuan: Expecting a second phase of medium-term rally

We maintain the view that there will be a “second phase of rally” in the medium term, likely starting around 2026. During the Spring Festival, many risk factors persisted, and a short-term correction may continue after the holiday. Once the lower boundary of the fluctuation range is identified, preparations for the “second phase of rally” can begin, opening a window for medium-term allocations. This phase is likely to start slowly, allowing for a measured deployment. The two sessions in March and the U.S.-China relations outlook in late March and early April may produce rebound opportunities amid market oscillations. The best opportunities during these oscillations are in new technological directions, with recent highlights from the holiday serving as primary sources of short-term structural opportunities. Focus areas include: robotics (not yet reaching low-cost, high-performance segments), AI large models (more application diffusion in A-shares), and storage. Additionally, concerns over U.S.-Iran conflicts may boost oil and shipping stocks. Medium-term, sectors such as technology and cyclical stocks remain favorable, with non-bank financials also expected to see revaluation opportunities.

Industrial Securities: Continuing to favor a new round of post-holiday rally

Before the holiday, A-shares adjusted following overseas asset movements, releasing some risk. After the holiday, a high-probability window for gains is emerging, supported by factors such as U.S. tariffs being deemed unconstitutional and the confirmation of Trump’s visit to China, which boost risk appetite and provide macro and industry catalysts. Continued optimism is expected for a new upward phase. Relative to other sectors, technology manufacturing, resource stocks, and infrastructure are particularly favored. In technology manufacturing, focus remains on “pan-AI assets,” especially infrastructure for computing power and commercialization. For resource stocks, the structural nature of price increases driven by supply-demand improvements is key; sectors like midstream materials and manufacturing are likely to sustain gains, while upstream resources and downstream consumer-related stocks require further observation of supply-demand transmission. Lastly, attention should be paid to the recovery opportunities in export chains following tariff reductions, especially in light industries, consumer electronics, batteries, auto parts, and medical devices with significant U.S. revenue exposure and existing capacity or trade re-exports in ASEAN regions affected by previous high tariffs.