Zhitong Hong Kong Stock Exchange Unravels | PCB takes the lead, and technology groups ushered in a V-shaped rebound, double catalysis for non-ferrous metals

[Anatomy Dashboard]

After a continuous freezing point, A-shares finally experienced a V-shaped rebound. Hong Kong stocks also followed suit this time, closing up 0.52%.

As mentioned yesterday, the intensity of the US-Iran conflict is increasing. The US military used precision-guided bombs to attack Iran's coastal defense system, missile and drone bases, and maritime military facilities. Iran's Revolutionary Guard Corps attacked the Fifth Fleet of the US Army in Bahrain with missiles and drones, claiming to destroy its radar system, “Patriots” air defense system, and unmanned boat control center. The focus now is on control of the strait. Trump announced the reinstatement of the maritime blockade against Iran, charging 20% of all cargo passing through the Strait of Hormuz. The blockade came into effect early this morning, which means that a double blockade has been added to the strait. According to Xinhua News Agency, the UAE's Abu Dhabi National Oil Company confirmed on the 14th that the “Mombasa” and “Bahia” tankers were hit by projectiles while passing through the Strait of Hormuz on the same day, and the lifeblood of global energy was once again strangled. International oil prices skyrocketed last night — WTI surged 9.42% to $78.14, and Brent soared 9.59% to $83.30, the biggest one-day increase in 6 years. Shandong Molong (00568), CNPC (00857), and CNOOC (00883) all rose more than 3%.

Shipping has also become more strained. Apart from the Strait of Hormuz, the Mander Strait, another shipping hub, has also become unsafe. To retaliate against Saudi air strikes against Sana'a International Airport, the capital of Yemen, the Houthis attacked Saudi Abha International Airport with multiple missiles and drones. Furthermore, the Suez Canal Authority announced a drastic increase in the toll fees for all types of ships starting July 15. Haifeng International (01308) and Oriental Overseas International (00316) rose more than 6%, and COSCO Marine Control (01919) rose more than 4%.

Although the war in the Middle East has had little impact on the market, they are all used to this pattern of “fighting each other”. As long as there are no ground forces, no matter how you fight, it won't hurt your bones, unless you hit a very important person or facility. However, once again, the strait is blocked, and various negative effects on the economic level will gradually become apparent. For example, short-term and large-scale transportation of oil and gas is blocked, which will trigger various chain reactions.

Today's market turning point is in the afternoon. The technology trend still depends on South Korea. News broke out in South Korea: the four major departments of the Finance Committee, the Bank of Korea, and the Financial Supervisory Service will hold a special high-level meeting on July 16 to address yesterday's leveraged ETF crash in a targeted manner. SK Hynix and Samsung, which plummeted yesterday, both rebounded more than 3%, driving overall technology stocks to strengthen.

On July 16 (Thursday), Changxin Technology (688825.SH)'s IPO will welcome an online subscription. Participating companies involving Hong Kong stocks include Zhaoyi Innovation (03986), which directly holds about 1.88% of Changxin Technology's shares and is the exclusive foundry for Changxin Technology's DRAM products. This has benefited the most, both direct shareholding and business collaboration. Today, the Midea Group (00300) has rebounded more than 9%; another Midea Group (00300) indirectly holds about 0.76% of Changxin Technology's shares through a wholly-owned subsidiary, which is a long-term value shareholder. Basically, it is a financial investment. The return on investment was obtained. Today, it has risen slightly.

The main force behind the technological rebound is PCB. Since July, the PCB industry chain has been intensively releasing signals of price increases. Jiantao Laminate (01888), the world's leading copper-clad board company, announced the sixth price increase notice during the year. FR-4 sheets increased 15%, CEM-1 and 22F sheets increased 10%, PP (semi-cured sheet) prices increased 15%, and copper foil processing fees increased by 5 to 8 yuan/kg. Today's increase is over 14%; industry performance is also quite strong. Yesterday, quite a few PCBs announced strong performance forecasts. A-share Shengyi Technology (600183.SH) and Shengyi Electronics (688183.SH) all forecast a year-on-year increase of more than 100% in the first half of the year. Shanghai Electric Power (002463.SZ) is expected to achieve net profit of 2.83 billion yuan to 30 billion yuan, an increase of 68.17% to 78.28%. Jin'an Guoji (002636.SZ) expects net profit for the first half of the year to be 78.28% 100 million yuan, an increase of 935.75% to 1,063.45%, and the above categories all rose by more than 10%; in terms of Hong Kong stocks, Dingtai Hi-Tech (01377) also showed impressive performance. The net profit for the first half of the year is expected to be 640 million yuan to 700 million yuan, a sharp increase of 300.62% to 338.18% over the previous year; the performance exploded by more than 10% today. Guanghe Technology (01989) expects to achieve net profit of 910 million yuan to 960 million yuan in the first half of the year, an increase of 85.12% to 95.29% over the previous year; an increase of more than 11%.

The direction of the optical module resonates with the PCB. According to institutional research reports, the global optical module market size is about 10.9 billion US dollars in 2023, and is expected to increase to about 41.7 billion US dollars in 2028. The compound growth rate is about 30.8%. 800G is the main driving force for growth. 1.6T will enter the rapid expansion stage in 2026, and Cambridge Technology (06166) will increase by more than 7%. The optical fiber category was affected by the expansion of production in the early stages, and was interpreted as being bad. In fact, supply is still tight. Today, the industry has taken the opportunity to rebound sharply, with Lingyi Manufacturing (01688) and Changfei Optical Fiber (06869) both surging by more than 10%.

Non-ferrous metals are also collectively strengthening today, mainly aluminum and copper. The direct catalyst is performance. Looking at aluminum first, Innovation Industry (02788) expects net profit of about 2.2 billion yuan to 2.4 billion yuan in the first half of the year, an increase of about 154.1% to 177.2% over the previous year, a sharp increase of nearly 15%; China Aluminum (02600) revealed its performance forecast for the first half of the year, which is expected to increase by 58% to 73% over the previous year. Today's increase of more than 9%, China Hongqiao (01378) estimates that the performance will not be bad. Second, supply and demand were misaligned. Production capacity in the Middle East was reduced by 2.86 million tons during the year, compounded by Mozambique's shutdown of 520,000 tons, resulting in a 1.2 million ton gap in global electrolytic aluminum supply. LME aluminum inventories have fallen below the historic low of 300,000 tons, and the pace of domestic dewarehousing continues to accelerate. Looking at copper, China's nonferrous mining industry (01258): The net profit for the first half of 2026 is expected to be about US$420 million, an increase of about 60% and a year-on-year increase of nearly 7%. Congo Gold KCC stopped production. On July 9, Congo Gold sealed KCC, an important global producer of copper and cobalt. The company produces about 190,000 tons of electrolytic copper per year, directly impacting the global copper supply. Domestic copper stocks have dropped to around 200,000 tons, and the gap between supply and demand continues to expand; others include nickel. Zhongwei New Materials (02879) expects net profit to increase by up to 84.23% year on year in the first half of the year. Earnings from laterite nickel ore have steadily increased, rising more than 8% today. The molybdenum industry's Luoyang Molybdenum Industry (03993) and the tungsten industry's Jiaxin International Resources (03858) also both increased by more than 7%.

Pharmaceutical stocks, which have been strengthening repeatedly recently, have entered into downsizing speculation. The latest direction is domestic early research CRO+ small molecule CMO, and domestic early research CRO's new orders are increasing month-on-month. At the same time, the third quarter was a major inflection point in the report. Small-molecule CMO binds GLP-1, performance is determined, and there is room for improvement in valuation; there is also in-hospital anti-corruption leading to additional CXO allocation. The main ones include Zhaoyan New Pharmaceutical (06127), Kanglong Chemical (03759), Gloria (06821), and Pharmaceutical Kangde (02359).

The US Bureau of Labor Statistics will release the June CPI report at 20:30 Beijing time. According to economists surveyed by the media, the drop in gasoline prices is expected to turn the June CPI increase negative month-on-month. This will be the first time in 6 years. The release of the CPI data comes just a few hours before Federal Reserve Chairman Walsh's semi-annual congressional testimony. The performance of the inflation data may not only affect the Fed's decisions in the July interest rate decision, but may also directly determine the market's pricing logic for the Fed's monetary policy in the second half of the year. Today's gold stocks are also reflecting expectations ahead of schedule, such as China Gold International (02099), Lingbao Gold (03330), and Zijin Gold International (02259).

[Section Focus]

El Niño is extremely hot, and electricity consumption explodes at its peak in summer. Jiangnan was in full bloom in mid-July, and the country continued to have high temperatures of 38°C+. The maximum electricity consumption load this summer is estimated at 1.6 billion kilowatts, 90 million kilowatts more than the previous year; due to the drought in the Yangtze River Basin, hydropower output fell by 20%-40%, and photovoltaic wind power output weakened, and the electricity gap was all filled by thermal power.

There has been a marginal improvement in fundamentals: the price of 5,500 kilocalories of coal at the port has stopped falling; coal shipping costs have rebounded markedly, and the cost of imported coal has rebounded; the port has gradually entered storage (the willingness of traders to ship has weakened); temperatures have rebounded and the daily consumption of power plants has begun to rise seasonally; and overseas oil and gas prices have clearly rebounded.

The main varieties of Hong Kong stocks: China Shenhua (01088), Yankuang Energy (01171), China Coal Energy (01898), Yancoal Australia (03668).

[Individual Stock Mining]

Cambridge Technology (06166): Semi-annual performance growth continues to increase production capacity layout for high-speed optical modules

The company expects net profit attributable to shareholders of listed companies for the first half year of 2026 to be 310 million yuan to 359 million yuan, an increase of 157%-197% over the previous year. Meta recently announced that it will spend more than 9 billion US dollars to build a large-scale data center in Canada, simultaneously promoting 1GW AI clusters and multiple titan clusters, and the overall AI infrastructure capital expenditure has reached hundreds of billions of dollars.

Comment: The increase in performance is mainly due to significant growth in the high-speed optical module business. Strong market demand in this business led to a sharp increase in orders. Timely delivery of the company supported a sharp year-on-year increase in delivery amounts, and product structure changes drove a significant increase in gross sales margin. Meta's computing power expansion continues to be catalyzed, and it is expected that it will continue to drive demand for high-speed optical modules and optical communication infrastructure. The company continues to increase the R&D and production capacity expansion of 800G/1.6T high-speed optical modules on the basis of building a solid basic market and ensuring stable profits in the traditional telecom optical communication business, and is simultaneously deeply tied to the construction of overseas AI computing power clusters. The overseas channel layout is perfect, and the supply chain responsiveness is outstanding. The global AI big model and the wave of data center construction are the core growth drivers for the company's future. The demand for high-bandwidth, low-latency connectivity in AI networks is driving optical modules to iterate at 800G, 1.6T, and higher speeds. The company closely follows the pace of global computing power construction, continuously increases the production capacity layout of high-speed optical modules, optimizes overseas production capacity support, and guarantees high-end product delivery capabilities; 800G and 1.6T high-speed optical modules have been successfully delivered in batches to meet the interconnection needs of next-generation hyperscale computing power centers and data centers.

Relying on mature overseas customer channels and localized delivery service capabilities, it is deeply tied to overseas computing power markets such as North America and Southeast Asia. Overseas orders continue to land, while the product structure continues to be optimized, and the proportion of high-end high-speed optical modules has steadily increased. The JDM mode locks down long-term orders. The company is Cisco's largest supplier of optical modules: co-developed by exclusive JDM, 800G supplies account for about 60% of Cisco's annual purchases (over 600,000 units shipped in 2025), and the cooperation continued from 400G to 1.6T. Successfully entered the Nvidia AI cluster supply chain, 800G/1.6T entered Google, Meta, and Amazon factory audit and verification, and orders from overseas cloud companies are expected to double and expand in 2026.

800G is currently the main force in need of AI computing power. The company's revenue for high-speed optical modules in 2025 was 1,675 billion yuan, a sharp increase of 240% over the previous year; the 1.6T silicon optical module 2026Q1 was shipped on a large scale, and the single value and gross margin were significantly higher than 800G. The agency expected the share of optical module revenue to increase to more than 60% in 2026, and the sector's gross margin would impact 35% +. The company continues to develop the overseas telecom broadband access equipment business, deeply exploiting the communication construction needs of emerging markets around the world. The revenue scale of the overseas communication business has steadily increased, and provided channel and operating experience support for the global expansion of optical modules. Relying on the global supply chain layout and overseas localization operation teams, the “communication equipment + high-speed optical module” dual business collaboration is realized, and the dual needs of overseas computing power and communication infrastructure are accurately matched.