A Middle East artillery shot over the weekend, will A-shares pay the bill on Monday?

Friday’s market was quite interesting with the index diverging: the Shanghai Composite turned positive, while the ChiNext fell over 1%, and trading volume across the two markets shrank below 2.5 trillion yuan. The number of advancing and declining stocks was decent—over 3,000 stocks rose—but the profit-taking effect was concentrated in a few sectors—small metals, electricity, and computing power—while the previously hot AI hardware (PCB, CPO) stocks collectively took a hit. [Taoguba]
This kind of seesaw pattern has become the norm recently.
Over the weekend, the Middle East situation suddenly escalated. Iran’s top leader was attacked and killed, and news of a blockade in the Strait of Hormuz was announced, causing international oil prices and gold to surge. Some friends joked online: “Planning to go all-in on military industry and gold this weekend, will the market open high and then fall on Monday, letting the hidden funds get slapped in the face?”

First, let’s talk about the most explosive event over the weekend.
This incident in Iran directly tightened global market nerves. The Strait of Hormuz transports about 20 million barrels of crude oil daily, accounting for 20% of global supply. If the blockade continues, a surge in oil prices is inevitable. Brent crude already rose over 2% on Friday, and it’s likely to continue rising at Monday’s open.
But there’s a problem: too many funds are already positioned.
Since last week, oil, gold, and military stocks have already moved ahead of the curve. Zhanyuan Tungsten, Jiangwu Equipment, and Northern Rare Earth have all hit new highs—these resource stocks have been front-running. If Monday opens sharply higher, should you chase or wait? My view is: don’t get caught up. Referencing the 2019 attack on Saudi Aramco, after the initial emotional premium, if production capacity isn’t truly disrupted, prices will quickly fall back. The same applies here—first watch whether the Strait of Hormuz blockade persists, don’t be fooled into buying on the open high.

Besides resources, another theme being discussed over the weekend is AI + military industry.
It was reported that the US military used space forces (Starlink) and AI large models (Claude) to assist decision-making. Some summarized it as “AI killed Khamenei.” This logic is quite interesting: modern warfare increasingly relies on space reconnaissance and AI data processing, and the dual-use nature of commercial space is being reinforced. The Economic Daily also published articles supporting commercial space, with companies like China Academy of Space Technology and LandSpace actively moving.
On Monday, observe whether the commercial space sector gains market recognition. On Friday, stocks like Aerospace Power and Fushun Special Steel showed unusual activity. If combined with military sentiment, this could become a new direction.

Back to domestic news: the Two Sessions will start next week, with the NPC opening on March 5 to deliver the government work report.
Electricity stocks already reacted early on Friday, with Ganneng Power hitting three consecutive limit-ups, Huayin Electric Power and Shama Electric Power hitting two. The logic is simple: first, Trump’s side wants tech companies to handle data center power consumption themselves, which in China translates to “integrated computing and power”; second, the Two Sessions are expected to revise renewable energy laws and draft the 14th Five-Year Plan, both catalysts for electricity stocks.
In small metals, tungsten prices broke through 1,800 yuan/kg, up 470% in a year, with Zhanyuan Tungsten and Zhongwugao New reaching new highs. Rare earths, germanium, gallium—these strategic resources—are also being referenced for pricing by the US, so supply-side stories still have room.

AI hardware stocks adjusted on Friday, mainly due to Nvidia’s earnings report and prior gains. Zhongji Xuchuang fell over 6%, and Xinyi Sheng dropped over 5%. However, domestic computing power stocks strengthened, with Yunnan Energy Holding hitting seven consecutive limit-ups, Tuo Wei Information opening its first limit-up, and Hang Steel Shares hitting the daily limit. News shows that China’s AI call volume has surpassed the US, with four large models ranking in the top five globally, indicating a domestic surge in computing demand.
So, AI isn’t over; it’s a sector with internal differentiation—hardware (CPO, PCB) is temporarily consolidating, while domestic computing power (Huawei Ascend, cloud leasing) is taking over. The upcoming GTC conference and Huawei partner event will serve as catalysts, and after adjustments, there may be new opportunities.

Friday’s continuous limit-up stocks broke through new heights: Yunnan Energy Holding hit seven consecutive limit-ups, Jinchengda four, and Ganneng Power three. The loss-making effect has significantly diminished, and the A-shares sell-off has basically disappeared. But the market is still in a chaotic phase, with no clear main theme, and sector rotation is rapid. In this environment, chasing high can lead to losses, while low-positioning is more comfortable.

With so many news events over the weekend, Monday is likely to see resource stocks opening high, but the subsequent trend depends on how funds judge the sustainability of the geopolitical situation. If prices retreat after a surge, funds may flow back into tech or the Two Sessions themes. In short, don’t rush; watch more, act less, and wait for half an hour after the market opens.

Tomorrow’s key trend stocks (for review purposes only, not investment advice):
Small metals: Zhanyuan Tungsten, Zhongwugao New, Northern Rare Earth
Electricity: Ganneng Power, Huayin Electric Power, Shama Electric Power
Domestic computing power: Yunnan Energy Holding, Tuo Wei Information, Taijia Shares
Commercial space: Aerospace Power, Fushun Special Steel, China Academy of Space Technology (not listed, watch related concept stocks)
Oil & gas: Zhunyou Petroleum, Tongyuan Petroleum (watch for high open risk)

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