Last week, the A-share market showed a divergent trend: the CSI 300 fell 0.83%, the CSI 500 dropped 0.94%, and the CSI 1000 declined 1.08%. Meanwhile, the ChiNext 50 rose 1.50%, while the STAR 50 fell 1.52%. In terms of trading activity, the average daily turnover in the A-share market was around RMB 1.82 trillion.
The recent Optoelectronics Expo held in Shenzhen boosted the communications sector's recovery. The optical communications industry is currently experiencing a four-fold resonance of strong demand growth, constrained supply, technological iteration, and domestic substitution. The sector faces a tight balance where high-end products are in short supply. We recommend continuing to focus on the ChiNext 50 Index, which heavily weights core tech leaders in AI computing, optical communications, chips, and new energy batteries.
The overall valuation of the tech sector has significantly retreated into a cost-effective range. The ChiNext 50 Index's PE ratio has fallen back to around the 24% percentile over the past decade. The ChiNext board serves as a direct financing platform for growth-oriented, innovative entrepreneurial companies.
In terms of sector weights, the ChiNext 50 Index focuses on four new quality productivity tracks: information technology, new energy, fintech, and biomedicine, giving it a pure tech-growth characteristic. ChiNext 50 Index Four Major Sectors Data source: Wind, Hua'an Fund, as of 2026-9-11.
The ChiNext 50 Index: chasing "light", recognizing "innovation", and digging for "gold". Horizontally, the ChiNext 50 Index has a higher content of optical modules, new energy batteries, and fintech compared to the broader ChiNext Index and mainstream broad-based indices.
ChiNext 50 ETF Hua'an (159949) brings together leading white-horse stocks in ChiNext's advantageous sectors, focusing on leading enterprises with high-tech growth attributes. Its ROE has remained at a high level of 15%-20% over the past six years, outperforming other mainstream broad-based indices. Its net profit attributable to the parent company grew by 22%/48% in 2025/H1 2026. Its current valuation is 32.18 times earnings, at the 24.13% percentile over the past decade (Data source: Wind, as of 2026-9-11). ChiNext 50 Index (399673.SZ)
Key Industry Outlook for Weighted Sectors
Communications: The communications sector rose against the trend last week. The 27th China International Optoelectronic Expo (CIOE 2026) was held at the Shenzhen World Exhibition & Convention Center from September 9-11, 2026, attracting over 4,000 exhibitors. Reflecting on the expo: the high prosperity of optical communications persists, with all parts of the chain resonating and demand improving across the board. The core variable in the optical communications industry has shifted from the demand side to the delivery side, with the market entering a seller's market structure. We suggest continuing to focus on the optical communications industry chain. The "light" content of the ChiNext 50 Index is as high as 31%.
Five structural industry directions are clear. (1) In the pluggable module sector, 800G remains the main delivery force, while 1.6T is entering the volume ramp-up stage. New products like 3.2T, NPO, and XPO are being released intensively, with downstream coverage expected to gradually penetrate from Scale-out to Scale-up scenarios, opening up further market space. (2) Structural changes in the upstream industry chain are even more critical. DSP remains the most constrained supply bottleneck, with domestic manufacturers accelerating verification and adoption. Meanwhile, NPO tends to adopt linear direct-drive solutions, eliminating high-power DSPs and enabling TIA and Driver to take over the original signal compensation functions of DSP, increasing their value and strategic importance. (3) In the optical chip segment, 70mW CW light sources have shipped in large volumes, with 100mW gradually becoming mainstream, and 200mW and above entering R&D and verification stages. EML has achieved mass production at 100G, upgrading towards higher rates of 200G. Demand for silicon photonics PIC is rapidly increasing with adoption rates. Thin-film lithium niobate is a core material for the evolution to single-wavelength 400G, with demand appearing quickly. (4) Demand growth in the OCS field is clear, with NVIDIA potentially following Google's large-scale adoption. Shipments are projected at around 15,000 units in 2026, potentially rising to 50,000 units in 2027. Insufficient delivery capacity among overseas manufacturers forms a supply constraint. (5) The value focus of passive components is shifting towards high-density coupling and connectivity. MPO is in short supply, MMC demand is strengthening, and DFAU is expected to see volume growth next year with the commercialization of NPO/CPO.
New Energy Batteries: The electrical equipment and new energy sector faced overall pressure last week. The main contract for lithium carbonate fell over 5% for the week, mainly due to adjustments in SMM inventory methodology, with visible inventory revised up to 169,300 tons, raising supply concerns. However, September production schedules increased by about 6% month-on-month, energy storage demand remains strong, and price increases for midstream materials are gradually being implemented. The battery consumption tax took effect in September, with a 2% rate squeezing profits in the short term; leading battery manufacturers have started passing costs to automakers, and capacity filing suspensions are tightening supply. CATL completed its first share buyback of about RMB 200 million, signaling confidence. Progress is also being made on solid-state battery pilot and mass production lines. Overall, the decline was driven by lithium price sentiment rather than a deterioration in fundamentals. Watch for support at RMB 130,000/ton for lithium carbonate and the pass-through of price increases. (The above stocks serve as examples only and do not constitute investment advice)
Electronics: The electronics sector experienced overall volatility last week. Memory chips continued their structural divergence. On the DRAM front, supply continues to tighten. Samsung Electronics was the first to suspend DDR5 contract price quotes for October, with SK Hynix and Micron following suit. Spot supply has become nearly "starved," with quote resumption potentially delayed until mid-November. NAND flash, however, is under pressure due to weak consumer demand. On the inventory side, Samsung and SK Hynix have less than 10 days of sellable inventory, and KB Securities has warned of a potentially unprecedented supply shortage next year. Domestic substitution has achieved a landmark breakthrough: CXMT has officially commenced mass production and commercial use of LPDDR6, debuting in the Xiaomi Mix Fold 18, with peak rates of 12,800 Mbps. The company also confirmed that the tight DRAM supply situation will persist in the second half of the year. In the short term, we are watching the persistence of DRAM price pass-through and the pace of domestic storage capacity ramp-up. The tight supply-demand balance in the memory chip sector may remain a core medium-term support. (The above stocks serve as examples only and do not constitute investment advice)
Introduction to ChiNext 50 ETF Hua'an (Code: 159949): The ChiNext 50 ETF Hua'an tracks the ChiNext 50 Index. The index selects 50 companies with high visibility, liquidity, and market capitalization on the ChiNext board. It currently primarily covers leading companies across five advantageous technology tracks, including communications, electronics, new energy batteries, internet finance, and biomedicine, offering relatively high investment value. The ChiNext 50 ETF Hua'an (Code: 159949) offers ample liquidity, with an average daily turnover of RMB 1.997 billion over the past year, ranking among the top ETFs on the Shenzhen Stock Exchange. The fund has a latest scale of RMB 24.659 billion, making it one of the larger funds tracking ChiNext-related indices in the market. Regarding ETF subscription/redemption fees, investors may be charged a fee/commission of up to 0.5% by sales institutions for cash subscriptions or redemptions, which includes fees charged by exchanges and clearing institutions.
Risk Disclosure: The above is merely an objective introduction to the current constituent stocks of the target index and does not constitute any investment advice or guarantee of investment returns. The index company may adjust the index compilation methodology in the future, and the composition and weights of index constituents may change dynamically. Please be aware of the risks associated with large weights and high concentration of certain index constituents. This fund is an equity fund, which is a higher-risk, higher-expected-return fund category. It primarily invests in the constituent stocks of the target index and alternative constituent stocks. Its feeder funds primarily track the performance of the target ETF. The expected returns and risks of this fund are higher than those of money market funds, bond funds, and hybrid funds, and it has risk-return characteristics similar to the target index. Fund management companies do not guarantee that this fund will be profitable or guarantee a minimum return. Past performance of the fund does not indicate future performance. The performance of other funds managed by the fund manager does not constitute a guarantee of this fund's performance. Fund product returns are subject to volatility risk. Investment requires caution. Please carefully read the fund's contract, prospectus, and other fund legal documents for details.