Understanding the Market | Innovative drug concept stocks are under pressure across the board, with tightening liquidity directly suppressing sector valuations. Institutions indicate that the impact of the BINSA draft is more emotional
Affected by the strengthening expectations of the Federal Reserve's interest rate hikes and tightening liquidity, innovative drug concept stocks are under pressure across the board, with stocks like INNOVENT BIO and 3SBIO declining. In addition, the release of the BINSA draft in the United States has caused short-term emotional fluctuations, but institutions believe that there is significant resistance to its implementation. The current volatility is largely driven by emotional panic rather than a deterioration in fundamentals, and it is recommended to focus on competitive leading companies
According to the Zhitong Finance APP, innovative drug concept stocks are under pressure across the board. As of the time of publication, Innovent Biologics (01801) is down 4.9%, trading at HKD 72.85; 3SBIO (01530) is down 3.44%, trading at HKD 15.14; China National Pharmaceutical Group (01177) is down 3%, trading at HKD 4.52; and Shanghai Pharmaceuticals (01093) is down 2.49%, trading at HKD 7.06.
On the news front, as tensions in the Middle East drive up energy prices, a strong labor market has reinforced market bets on the Federal Reserve raising interest rates within the year. Guohai Securities previously pointed out in a risk warning that if the pace of global and domestic macro monetary policy does not meet expectations, it will directly affect the valuation levels and investment environment of the pharmaceutical sector. Growth tracks such as innovative drugs and CXO are sensitive to liquidity; if the Federal Reserve's interest rate cut cycle is delayed, or if domestic reserve requirement ratio cuts and interest rate reductions do not meet expectations, tightening market liquidity will directly suppress the valuations of growth tracks.
In addition, on June 2, the U.S. "Biotechnology Investment National Security Act (BINSA)" was announced. Everbright Securities pointed out that overall, the current BINSA draft is still in the early stages, facing significant implementation obstacles. Short-term fluctuations are more about emotional panic rather than fundamental deterioration. Many leading companies with global competitiveness, high compliance barriers, and strong performance certainty may be mispriced. It is recommended to actively position in high-quality innovative drugs and leading companies in the innovative drug industry chain
