Northbound funds flowed out again by billions, contra-trading in non-ferrous metals and automobiles, "trading in old for new"

This week, the net outflow of northbound funds was 11.417 billion yuan, with a net outflow of 2.152 billion yuan through the Shanghai-Hong Kong Stock Connect and 9.265 billion yuan through the Shenzhen-Hong Kong Stock Connect. On the evening of July 26th, the Shanghai and Shenzhen Stock Exchanges decided to adjust the information disclosure mechanism for the Shanghai-Hong Kong Stock Connect starting from August 19, 2024. After the adjustment, after the close of each trading day for the Shanghai-Hong Kong Stock Connect and the Shenzhen-Hong Kong Stock Connect, the total trading volume and number of transactions for the day, ETF trading volume, the list of top ten active securities traded, and their total trading volume will be disclosed, and the summary of the above data will be published on a monthly and annual basis. In addition, on the fifth trading day of each quarter for the Shanghai-Hong Kong Stock Connect and the Shenzhen-Hong Kong Stock Connect, the total number of shares held by investors through the Shanghai-Hong Kong Stock Connect and the Shenzhen-Hong Kong Stock Connect for a single security as of the end of the previous quarter will be disclosed. Contrarian Buying in Non-ferrous Metals In terms of industries, this week, the northbound funds bought into non-ferrous metals, automobiles, and electronics. The prices of hot metal continued to weaken this week: spot gold has fallen by nearly 5% since hitting a new high on July 17; on July 25, Shanghai silver futures fell by 5.3%; since hitting historical highs on May 20 this year, London copper futures and Shanghai copper futures main contracts have been fluctuating downward, with the lowest points on July 25 reaching $8,900 per ton and 72,800 yuan per ton respectively, representing cumulative declines of 19.85% and 18.41% from their previous highs. The stock prices of related companies have also continued to decline. Haitong Futures stated that the recent significant adjustments in precious metals coincide with a decline in domestic positions, especially with total silver positions dropping from nearly 1 million contracts at the high point in May to less than 900,000 contracts today. This indicates that more funds are taking profits or cutting losses and exiting, rather than significantly increasing positions due to a bearish market outlook. The outlook for precious metals in the second half of the year remains optimistic, with room for further upside. According to China Securities Journal, industry insiders stated that the market has a pessimistic outlook on the macro level, coupled with high copper market inventories, leading to a high-level pullback in copper prices. Currently, bearish factors continue to be released, and in the short term, copper prices may continue to be weak. In the automobile sector, on July 25, the National Development and Reform Commission and the Ministry of Finance issued the "Several Measures to Further Support Large-Scale Equipment Upgrades and the Replacement of Consumer Goods with New Ones." The measures have increased the subsidy standards from the previous 10,000 yuan for the purchase of new energy passenger vehicles and 7,000 yuan for the purchase of fuel passenger vehicles to 20,000 yuan and 15,000 yuan respectively, doubling or more. CITIC Securities stated that this comprehensive automobile replacement policy exceeded market expectations, and is expected to significantly boost industry sales, with the industry's prosperity expected to rise, leading to an overweight position in the automobile sector. Bottom Fishing in Zijin Mining On individual stocks, the top buys by Northbound investors this week include Zijin Mining, Huatai Medical, and Haier Smart Home. Zijin Mining is the only mining company in China and Asia with a copper production exceeding one million tons, ranking among the top five globally. It is also one of the fastest-growing companies in terms of copper and gold production among leading mining companies. With the decline in gold and copper prices, Zijin Mining has dropped nearly 20% since its peak on July 17. Huatai Medical, the second most bought stock this week, closed at 317 yuan after ex-dividend on Friday, remaining the top stock price on the Sci-Tech Innovation Board. The company is a leader in domestic products in the field of electrophysiology and vascular intervention. Earlier this year, Mindray Medical acquired a controlling stake in Huatai Medical for 6.65 billion yuan in cash, rapidly expanding its presence in the cardiovascular field. After the transaction, Mindray Medical and its concerted parties will hold 24.61% of Huatai Medical's shares, with Li Xiting and Xu Hang becoming the actual controllers of Huatai Medical. Haier Smart Home, the third most bought stock, surged 8.3% the day after the favorable policy of old-for-new replacement was introduced on Thursday. CITIC Securities stated that under optimistic assumptions, the domestic demand growth driven by the old-for-new subsidies in the next five months will be 50.9%. Increasing Positions in Vitamin Leaders From the perspective of the increase in positions, the top buys by Northbound funds this week include Zhejiang Medicine, Zhongtong Bus, and Aerospace Intelligent Manufacturing. Zhejiang Medicine's main products include fat-soluble vitamins and pseudo-vitamins. Against the backdrop of continuously rising vitamin prices, the company's stock price has risen by over 30% since mid-June. Zhongtong Bus, the second most bought stock, hit the daily limit up on Friday stimulated by the new policy of old-for-new replacement. The company is one of the earliest bus manufacturers and listed bus companies in China. Aerospace Intelligent Manufacturing, the third most bought stock, announced on July 15 that its net profit for the interim report was between 320 million and 370 million yuan, representing a growth of 6512.66% to 7545.89% compared to the same period last year before/after restructuring. The company is affiliated with China Aerospace Science and Technology Corporation, with businesses in automotive components, smart cabins, unmanned driving, and oil and gas equipment