8 minutes after opening, 20% limit-up! Major positive news continues to unfold!

CPO Resurges Again!

On February 3rd, during the early trading hours of the A-shares market, the ChiNext Index surged by 2% at one point, with CPO concept stocks soaring. Tianfu Communication rose over 10%, and XinYisheng and Zhongji Xuchuang increased by more than 3%. Zhishang Technology hit the 20% daily limit just 8 minutes after opening.

A brokerage research report indicates that, based on industry surveys, Nvidia’s CPO switches may begin shipments, with an estimated volume of 10,000 units. Spectrum5 is expected to lead the volume, and from Q2 onwards, Spectrum6 and Quantum CPO switches could see small-scale shipments. If Nvidia introduces CPO technology in scale-up applications by 2027, the optical interconnect scene will further expand.

Meanwhile, is the overall market stabilizing again, and is it conducive to thematic stocks’ performance?

CPO Positive Sentiment Continues to Ferment

According to Xunshi Optical Communications Network on January 30, Light Counting released a new report stating that AI development is driving rapid growth in the optical transceiver and Co-Packaged Optics (CPO) markets. The market size is projected to reach $16.5 billion by 2025 and surge to $26 billion in 2026, with an annual growth rate of up to 60%. Although supply chain shortages are easing, the capital expenditure frenzy of top cloud companies supports the market. Meta and Oracle plan to double their capital expenditures in 2026, while other companies have yet to update their 2026 spending plans.

Some brokerage research institutions suggest that, based on current assumptions, the sales of optical devices to the top five cloud providers in 2026 will account for 3.1% of their capital expenditures (up from 2.7% in 2025), and this will increase to 4.1% by 2031. Increased optical connection spending can be attributed to new applications such as Scale-up networks and the rapid growth in GPU bandwidth for Scale-out and Scale-up connections. The adoption of CPO in Scale-up connections may exceed expectations and lead the market to stronger growth between 2028 and 2031.

Additionally, Nvidia will hold a webinar on February 3rd regarding co-packaged silicon photonic switches, titled “Co-Packaged Silicon Photonic Switches for Billion-Watt AI Factories.” The event is scheduled for February 3, 2026, at 14:00-15:00 Singapore time / 17:00-18:00 Australian Eastern Time. Nvidia describes that ultra-large-scale AI is redefining what modern data centers must deliver. As next-generation AI workloads evolve toward massive models, real-time inference, and cross-region interconnectivity, infrastructure must continuously develop to achieve unprecedented scale, connectivity, and energy efficiency. The webinar will focus on how AI models are growing larger, with real-time inference, and how data centers can achieve supercomputing performance through Nvidia’s photonic switches, NVLink, and Spectrum-X Ethernet.

Some brokerages believe that 2026 will be the inaugural year for mass production of CPO. The core advantages of CPO are reducing TCO and power consumption. For example, in the GB300 NVL72 cluster, under extreme conditions, using CPO technology can reduce the transceiver power consumption of a 3-layer network by 84%, and overall network power consumption by 23%. Industry surveys suggest that Nvidia’s CPO switches are expected to ship around 10,000 units, with Spectrum5 leading the volume. From Q2 onwards, Spectrum6 and Quantum CPO switches may see small-scale shipments. If Nvidia introduces CPO technology in scale-up applications by 2027, the optical interconnect scene will further expand.

Is the Market Already Stabilizing?

So, is the market conducive to thematic performance? Have recent liquidity crises been resolved? Analysts believe that in the short term, on one hand, the external liquidity decline appears to have temporarily stabilized, but geopolitical uncertainties remain; on the other hand, considering the upcoming long holiday, internal deleveraging in China may still occur sporadically. Therefore, the market may trend sideways.

First, from last night to this morning, precious metals rebounded strongly, the US leverage lending index also showed a slight stabilization, and virtual currencies rebounded as well. However, it’s still uncertain whether this marks a reversal, as the rebound in leverage lending is modest, and virtual currency recovery is limited. Bitcoin remains below $79,000. It’s hard to say that liquidity patterns have completely reversed.

Geopolitically, issues in the Middle East still carry uncertainties. Trump said the US is in dialogue with Iran, “If we can reach some agreement, that would be great. If not, bad things could happen.” He reiterated military threats against Iran, mentioning that the US has sent a “massive” fleet, “even larger than in Venezuela,” among other remarks.

Second, internally, the current consensus is that during the last week before the Spring Festival, the market may gradually calm down. Although the current trading volume and financing balance in the A-shares market have decreased from previous highs, they remain relatively high. As the long holiday approaches, these two indicators are expected to converge. According to Wind data, the total financing buy-in in Shanghai and Shenzhen on that day was 241.866 billion yuan, down from 266.979 billion yuan the previous trading day; financing repayment was 247.876 billion yuan, down from 290.522 billion yuan; and the short selling volume was 182 million shares, compared to 95.36 million shares the previous day. Under this background, market volatility is also expected to subside.

(Article source: China Securities Journal)