In the past week, the three major A-share indexes experienced fluctuations and declines, with the Shanghai stock index falling 2.01% on August 11, marking the largest single-day drop of the year. As of the latest close, the Shanghai Index reported 3189.25 points, a weekly drop of 3.01%; the Shenzhen Component Index reported 10808.87 points, a weekly drop of 3.82%; the ChiNext Index reported 2187.04 points, a weekly drop of 3.37%.
Within the week, 15% of individual stocks rose, with 36 stocks rising more than 15% and 27 stocks falling more than 15%. Leading the gains were sectors such as pharmaceutical business, medical services, traditional Chinese medicine, chemical pharmaceuticals, and airport shipping, while sectors such as real estate services, complete automobiles, insurance, automobile services, and communication equipment led the decline.
One notable trend within the pharmaceutical sector was the rise in weight-loss drug concept stocks. Keyuan Pharmaceutical, the most bullish stock, saw its stock price double in just four days. The pharmaceutical sector experienced a slight recovery after the previous “slump,” with the concept of weight-loss drugs gaining attention in both Wall Street and Asian markets.
On August 8, Novo Nordisk, a leading pharmaceutical company, announced positive results from its Phase III trial of “SELECT,” which exceeded expectations. This trial focused on their weight-loss drug Wegovy and its potential role in reducing the risk of severe cardiovascular disease. This news led to a record high in Novo Nordisk’s stock price. The company also released better-than-expected first-half results and raised its full-year performance guidance.
The concept of weight-loss drugs continued to ferment, leading to an increase in domestic companies’ response to this development. Keyuan Pharmaceutical, a weight-loss drug concept stock, saw a significant increase of 98.19% and achieved four consecutive daily limits, resulting in a cumulative increase of 107.34% within the week. Other related concept stocks, such as Cenobiology and Saili Medical, also performed well.
Meanwhile, the stock price of Tieke Railway, a high-speed rail company, experienced a significant decline, dropping by 29.78% and hitting a 20CM limit on August 8. This decline comes after the company announced positive semi-annual results on August 7, which showed a significant increase in operating income and net profit. However, market insiders suggest that the unexpected drop limit may be due to profit-taking after the interim report was disclosed.
Despite the fluctuations and declines in the market, analysts remain optimistic about the medium and long-term growth of the consumer healthcare sector. They recommend focusing on leading companies with strong product iteration capabilities and large-scale medical networks. Additionally, they see potential growth in the pharmaceutical outsourcing service industry, the recovery of in vitro diagnosis, and the performance of private hospitals.
As the market enters the third quarter and the mid-term report disclosure period, the performance of individual stocks will be driven by the performance of the mid-term report. Analysts advise investors to focus on stocks whose performance exceeds expectations and maintain an “overweight” rating on the medical service industry.