The concept of innovative drugs becomes active again, and the total market transaction volume returns to 2 trillion yuan.

March 31, the A-share market saw choppy consolidation, and the Shanghai Composite briefly turned positive during the trading session. By the close, the Shanghai Composite Index closed at 3,891.86 points, down 0.80%; the Shenzhen Component Index closed at 13,478.06 points, down 1.81%; the ChiNext Index closed at 3,184.95 points, down 2.70%; and the STAR Market Composite Index closed at 1,618.58 points, down 2.48%. The trading value across the Shanghai, Shenzhen, and Beijing markets totaled 200.58 billion yuan for the full day, up by 78.3 billion yuan from the previous trading day.

Innovative drug concepts stay active and rebound repeatedly

On March 31, the pharmaceutical sector continued to remain active. The innovative drug concept performed strongly: Tianjin Yaoye Pharmaceutical surged straight to the daily limit within the first minute after opening, producing a three-session winning streak. In addition, momentum stocks also continued their upward trend, with Wanbangde, Kailaiying, and Luyan Pharmaceutical all closing at the daily limit.

On the news front, the annual meeting of the American Association for Cancer Research will be held in San Diego, U.S., from April 17 to April 22, 2026, and 104 Chinese pharmaceutical companies will showcase more than 250 innovative drug candidates.

According to a report from Huatai Securities, from a global perspective, since the beginning of the year, China’s share of the number of domestic innovative drug BD projects and disclosed amounts have respectively reached 20% and 75%. Among 21 major transactions that have been concluded, 15 are China-related, accounting for more than 70%.

A report from Huayuan Securities believes that China’s pharmaceutical industry has completed the shift in momentum from generic manufacturing to innovation, and that innovative drugs have become a new growth engine for the sector. For 2026 investment, the focus should center on two main lines: “science and technology innovation led” and “earnings and valuation repair.” Key attention should be paid to innovative drug leaders with global competitiveness and companies with strong overseas expansion capabilities. At the same time, actively lay out cutting-edge technology directions such as AI-enabled healthcare and brain-computer interface technology.

In addition, yesterday’s consumer discretionary sector saw a localized rebound. Sectors such as food and beverage, alcohol, and home appliances all showed some performance. By the close, Midea Group rose nearly 6%, Huangtai Wine Industry rose nearly 4%, and Kweichow Moutai was up more than 4% at one point during the day.

On the evening of March 30, Kweichow Moutai issued an announcement stating that, starting from March 31, the contract price for Feitian 53%vol 500ml Kweichow Moutai (2026) would be adjusted from 1,169 yuan per bottle to 1,269 yuan per bottle, and the retail price in its self-operated distribution system would be adjusted from 1,499 yuan per bottle to 1,539 yuan per bottle.

An Open-Source Securities research report expects that in the second half of 2026, the overall Baijiu industry may stabilize, with marginal improvements gradually becoming visible. The Baijiu sector has continued to follow the principle of certainty. It recommends allocating to leading high-end Baijiu brands.

Institutions: A layout window is arriving for high-quality AI stocks

Looking ahead, an Eastern Securities strategy weekly report said that the marginal negative impact of geopolitical conflicts in the Middle East on Chinese assets has weakened. Due to the strong full industrial chain ecosystem, China’s domestic economic system has significantly enhanced its ability to withstand pressure, and China’s relative advantage in asset safety still remains strong.

A report from Changjiang Securities argues that April is a dense period for A-share annual reports and first-quarter reports. Earnings-driven factors may become the core force behind market divergence in the short term. In terms of strategy, it focuses on three main themes: first, energy security—watch for an upward shift in the price center of gravity of traditional energy such as coal and petrochemicals under the backdrop of potential replenishment demand, as well as new energy directions under substitution demand; second, technology—continue to focus on the favorable cycle main line of AI infrastructure, including areas such as power, storage, and computing power, for example, optical modules, storage, and semiconductor equipment; third, focus on rebound opportunities for previously oversold names, such as precious metals and commercial aerospace.

On March 31, the Wealth Management Investment Director’s office at UBS Capital Management published a view stating that the current adjustment in the Chinese market may have been overdone, and investors may have an opportunity to increase holdings of high-quality Chinese AI stocks at relatively low valuations. The Chinese internet sector’s 12-month forward price-to-earnings ratio is currently around 13 times, which is close to the level before the release of DeepSeek. The current valuation has not yet fully reflected the returns brought by AI investment and monetization over the past year.