Understanding the Market | Concept stocks related to CRO collectively rise, with the Federal Reserve nearing interest rate cuts and multiple favorable policies emerging, the sector is expected to see marginal improvement

Concept stocks related to CRO collectively rose. As of the time of publication, Tigermed rose by 4.75% to HKD 28.65; GenScript Biotech Corporation rose by 4.66% to HKD 13.02; Pharmaron climbed by 3.76% to HKD 46.95; and Joinn Laboratories China increased by 2.56% to HKD 8.8. On the news front, with U.S. inflation falling more than expected in June and Powell frequently adopting a dovish stance, the market is now predicting a 100% probability of a rate cut by the Federal Reserve in September. Open Source Securities previously pointed out that as the Fed enters a rate-cutting cycle, improved liquidity will help optimize the investment and financing environment and boost the innovation drug research and development sentiment, potentially bringing greater valuation repair space to innovative drug targets that are still at the bottom. Furthermore, favorable policies continue to support the development of the innovative drug industry. Orient Securities stated that based on the latest data of key indicators of the CRO industry sentiment: global liquidity has basically stabilized, while domestic investment and financing are still relatively tight; enthusiasm for research and development remains high, with IND and new clinical trials still at high levels. The bank believes that the CXO sector, after experiencing a double blow in performance and valuation, is expected to see marginal improvement