China Market Pre-Open Preview
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A-shares are set to open on a positive tilt Wednesday. China's 15th Five-Year Plan earmarks roughly ¥2 trillion for data-center infrastructure, while overnight U.S. tech strength adds momentum — AI computing power and EV charging are the two lead themes, though escalating Middle East tensions could cap follow-through after the gap-up.
¥2 trillion for data centers — what is the policy saying?
The 15th Five-Year Plan names AI a priority sector and, for the first time, puts a number on it: roughly ¥2 trillion into national data-center infrastructure over five years.
This means → computing power and related equipment have moved from "market consensus direction" to a priceable policy anchor — exactly the narrative benchmark offshore investors were missing.
The release of the first large-scale offshore quantitative report on AI chips is prompting foreign institutions to revisit valuation models for China's computing-power supply chain.
Exports beat, inflation flat — how to read the macro data?
Customs data released Tuesday showed May exports up 11% year-on-year, beating expectations. The trade surplus widened to $36 billion.
Chip-manufacturing equipment imports turned positive for the first time after a steep year-on-year drop, signaling a recovery in domestic fab expansion demand. This means → the urgency of the "domestic substitution" narrative may soften in the near term.
On inflation, May CPI came in at +1.2% y/y, in line; PPI at -3.9% y/y — industrial deflation persists but the decline is narrowing. Wells Fargo Securities' Hong Kong-based chief economist noted: "The stabilization in PPI is worth watching — if demand picks up in H2, manufacturing margins could recover faster than expected."
3 million charging stations, a rocket launch — which sectors have fresh catalysts?
EV charging: the government plans to deploy over 3 million charging stations by end-2027, covering every county-level district — well above prior industry forecasts. This means → valuation frameworks for charging-station operators, grid-equipment makers, and automakers face a reset.
Aerospace: China's heavy-lift rocket Long March 10 completed its maiden flight Tuesday, opening a new phase of crewed lunar-mission validation. Satellite and commercial-space concept stocks are likely to draw flows.
In plain terms = the two directions with the densest policy catalysts — on the ground (charging) and in the sky (aerospace) — both just received timelines or milestones that beat expectations.
Why is sentiment split in semiconductors?
Taiwan is evaluating further restrictions on AI-chip exports to China; the timing remains unclear, lifting uncertainty.
At the same time, the near-term rebound in chip-equipment imports is prompting some houses to reassess the pace of equipment localization — if the import channel is less constrained, the valuation premium on domestic substitution names is harder to justify.
This reflects the sector's core tension: policy restrictions may tighten (bullish for domestic substitution) while import data is loosening (bearish for it). The two signals point in opposite directions, raising the odds of near-term pressure.
Middle East tensions and the Fed — how big is the external risk?
The main external disruption comes from Iran: tensions continue to escalate and the U.S. military has announced "defensive strikes." In plain terms = when geopolitical conflict flares, Asian-session capital tends to de-risk first and ask questions later — whether A-share tech can hold its opening gap is an open question.
The Fed's policy path and dollar movements remain the key variables for northbound fund flows.
Goldman Sachs' latest demand-outlook model revised up its data-center power-consumption forecast, providing additional support for domestic power and renewables names — but the market is divided on the model's underlying assumptions.
How to position today?
The short-term bullish case holds. Lead themes are AI infrastructure (computing power, data centers, optical modules) and EV charging stations.
Semiconductor equipment names are worth accumulating on dips — watch for the expectation-gap repair as import data recovers.
Watch for a sharp risk-off move if the Iran situation escalates further; moderate defensive positioning is warranted as a hedge.
Content is for reference only, not financial advice.