The three major A-share indices closed mixed, with the minor metals sector leading a surge in limit-up stocks

The three major A-shares indices showed mixed performance today. By the close, the Shanghai Composite rose 0.39%, closing at 4,162.88 points; the Shenzhen Component declined 0.06%, closing at 14,495.09 points; and the ChiNext Index fell 1.04%, closing at 3,310.30 points. The combined trading volume of the Shanghai, Shenzhen, and Beijing markets reached 2.51 trillion yuan, a slight decrease of 50.4 billion yuan from yesterday.

Industry sectors mostly gained, with small metals, rare earths, precious metals, energy metals, non-ferrous metals, coal, and power sectors leading the gains. Glass fiber, components, and electronic chemicals sectors saw the biggest declines.

In individual stocks, over 3,200 stocks rose, with nearly 100 hitting the daily limit. The small metals sector surged, with stocks like Oriental Zirconium, Xianglu Tungsten, Huaxi Nonferrous, Xiamen Tungsten, Minmetals, Guoyan Platinum, China Rare Earth, China Tungsten High-tech, Zhangyuan Tungsten, Baotai, Baowu Magnesium, and Tin Industry hitting the limit.

Today’s Highlights

Central Political Bureau Holds Meeting to Discuss the Draft Outline of the 14th Five-Year Plan and Government Work Report

On February 27, the Central Political Bureau held a meeting to review the draft outline of the 15th Five-Year Plan for national economic and social development and the draft government work report, which are to be submitted to the Fourth Session of the 14th National People’s Congress.

Central Bank: Forward Foreign Exchange Sales Risk Reserve Ratio Reduced from 20% to 0%

To promote the development of the foreign exchange market and support enterprises in managing exchange rate risks, the People’s Bank of China has decided to reduce the risk reserve ratio for forward foreign exchange sales from 20% to 0%, effective March 2, 2026. Moving forward, the PBOC will continue guiding financial institutions to optimize foreign exchange hedging services for enterprises and maintain the RMB exchange rate at a reasonable and balanced level.

2026 Plans Include Two Manned Space Missions and Full Effort to Build Lunar Support Infrastructure

According to the China Manned Space Agency, in 2026, China’s manned space program will deepen the implementation of the 15th Five-Year Plan, advancing the application and development of space stations and lunar exploration. The goal is to accelerate the construction of a space power. In 2026, two manned space missions and one cargo spacecraft resupply mission are planned. Astronauts from Hong Kong and Macau are expected to perform space station missions as early as this year, with the Shenzhou 23 crew conducting a one-year residency experiment.

“Rare Earth Shortage” Worsens! Some US Aerospace and Semiconductor Suppliers Unable to Accept Orders

Industry insiders revealed that US aerospace and semiconductor suppliers are facing increasingly severe shortages of rare earth elements, with at least two suppliers refusing certain customer orders. The shortages mainly involve yttrium and scandium, which are niche metals within the 17 rare earth elements. These elements are crucial in defense technology, aerospace, and semiconductors, and are almost entirely produced in China.

Institutional Views

CICC: International Monetary Order Rebuilding in 2026 Remains the Main Global Asset Theme

CICC research reports that the restructuring of the international monetary order will continue to be the main theme for global assets in 2026. 2025 is expected to be a year of accelerated reform, and this trend will persist into 2026. These trends support a continued bull market for Chinese stocks and gold, and favor Chinese stocks over US stocks. Regarding current market disagreements, CICC believes this trend provides key arguments: first, about the pace of the Chinese stock bull market, the “new order” of monetary restructuring will not happen overnight; global capital’s recognition process is ongoing, and the logic is still strengthening, favoring a slow bull market and ongoing asset revaluation in China. Second, regarding the impact of the “Vosh shock” on Fed easing, considering political, economic, and market constraints, the Fed currently lacks conditions for aggressive balance sheet reduction. Moreover, Vosh may push the Fed to cut rates more than expected, but this cannot reverse the decline in the Fed’s credibility and the safety of dollar assets. Third, the risk of a bubble in US AI stocks: CICC believes that AI can effectively improve productivity and does not carry systemic leverage or debt risks. Under the global reallocation of funds, high-quality assets tend to have higher valuation tolerance and overall performance remains solid. Asset allocation advice: overweight Chinese stocks and gold, maintain exposure to commodities, US stocks, and US bonds, and underweight Chinese government bonds.

Orient Securities: Next Phase Investment Focus in Mid-Cap Blue Chips

Huang Yanming, director of Orient Securities Research Institute, stated that the next phase of A-share investment will focus on mid-cap blue chips. The previous three years of high-growth tech and low-volatility, high-dividend markets have largely ended. The focus will shift to three main areas: first, globally priced cyclical commodities such as chemicals, non-ferrous metals, agricultural products, and global shipping; second, manufacturing sectors related to technological and national strength enhancement, such as military industry, robotics, and new energy; third, technology sectors entering performance realization, including large models related to AI.

CITIC Construction Investment: AIDC Construction Drives Demand for Supporting Equipment, Focus on Gas Turbines and Engines

CITIC Construction Investment reports that AIDC construction is entering a period of rapid growth. From 2025 to 2028, the demand for electricity capacity driven by US AI needs is expected to grow at a CAGR of about 55%, with a total demand exceeding 150 GW over three years, creating significant opportunities for supporting equipment. North America faces a power shortage, making self-built power sources a major trend. Gas turbines, with their quick response, high power adaptability, low generation costs, and high reliability, are the preferred main power source for AIDC. Currently, leading global gas turbine companies have order backlogs far exceeding their current capacity, and they are expanding production. However, overseas upstream supply chain expansion is cautious, leading to ongoing shortages in the industry chain. Domestic manufacturers of complete gas turbine units and core components are presented with opportunities. Additionally, attention is needed on replacement solutions for aircraft and ship fuel.

Galaxy Securities: Semiconductor Industry Sales Hit New High, Long-term Logic Remains Stable

Galaxy Securities reports that in December 2025, global semiconductor sales reached $78.9 billion, up 2.7% month-on-month and 37.1% year-on-year. Overall, the semiconductor industry achieved a new high in 2025, with sales of $791.7 billion, up 25.6% year-on-year. Regionally, except for Japan, which saw a 4.7% decline, other regions experienced year-on-year growth in semiconductor sales. The report expects that domestic and international AI infrastructure construction will continue strongly in 2026, and China’s push for localization will persist. Investment opportunities remain favorable in domestic computing chips, storage chips (which are in a large cyclical price increase), PCBs, semiconductor manufacturing and equipment, advanced packaging, and semiconductor materials.