A-share midday review: Funds fluctuate around 4000 points, ChiNext up more than 1%; securities, non-ferrous metals concepts and other sectors rise.

On October 29th, the A-share market fluctuated in the morning and rose, with funds around 4000 points in a tug of war. Over 3200 stocks drifted lower in the market, with a turnover of 1.42 trillion yuan in half a day, compared to 71.9 billion yuan on the previous trading day. By midday close, the Shanghai Composite Index rose by 0.37%, the Shenzhen Component Index rose by 0.90%, and the ChiNext Index rose by 1.35%. Orient believes that in the context of economic transformation, the importance of the capital market is highlighted, with favorable policies and funds. Combined with the industrial breakthroughs in the Fifteen-Year Plan, it indicates that reaching 4000 points does not mean the end of the market. The "technology bull" driven by the industrial revolution in technology is slowly coming. Firstly, looking at the process, the last two times the Shanghai Composite Index broke through 3000 points to reach 4000 points in less time, indicating that this time was prepared for. Secondly, from a valuation perspective, although the number and market value of A-share listed companies have increased significantly, the overall valuation is lower than the previous two times. Thirdly, looking at the future trends, although there were setbacks after the last two breaks through 4000 points, they continued to rise within six months. This time, in the context of the technology-driven era, there is reason to go further. On the market, sector rotation is fast-paced, with leading stocks in the bull market such as brokerage stocks showing unusual movements, Huaan hitting the limit up. The Hainan free trade zone concept continued to rise, with Hainan Development Holdings Nanhai and others hitting the limit up. There was a rebound in the non-ferrous metal sector, with Dazhong Mining hitting the limit up. The quantum technology concept repeatedly showed strength, with Digital China Information Service Group hitting the limit up. Computing hardware remained active, with businesses like Yufu Lian, Zhongji Innolight, Eoptolink Technology Inc., and Foxconn Industrial Internet hitting new highs. Solar power, solid-state batteries, and other new energy stocks rose, with Fangda Carbon New Material rising for two consecutive days. In terms of declines, the banking sector fell, with Bank of Chengdu dropping by over 5%, and the consumer goods, semiconductor, and pharmaceutical sectors showing the biggest declines. Popular Sectors: 1. Quantum technology concept shows strength The quantum technology concept has been showing strength recently, with Digital China Information Service Group hitting the limit up, and Western Superconducting Technologies, GuoChuang Software, Quantumctek Co., Ltd., and Topsec Technologies Group Inc. following suit. Analysis: On the news front, NVIDIA launched NVQLink, connecting quantum computing with GPU computing for 17 quantum computing companies and 9 research laboratories. NVQLink is an open system architecture that tightly couples the extreme performance of GPU computing with quantum processors to build an accelerated quantum supercomputer. According to a study by the China Research Institute of PwC, the global quantum technology market is expected to exceed $6.1 billion by 2025, with the Chinese market expected to reach 11.56 billion yuan, with a compound annual growth rate of over 30% over five years. 2. Hainan free trade zone concept rises The concept of the Hainan free trade zone continues to rise, with Hainan Development Holdings Nanhai, Hainan Haide Capital Management hitting the limit up, and Honz Pharmaceutical, Hainan Haiqi Transportation Group, and Hainan Mining following suit. Analysis: According to Xinhua News Agency, the whole-island closure operation of the Hainan Free Trade Port has entered the sprint stage and will officially start on December 18th of this year. Currently, various regions and industries in Hainan are continuing to expedite the implementation of free trade port policies and are making efforts to achieve the full-island closure operation. Institutional Views: 1. The Pacific Securities: The breakthrough of the ten-year bottom provides a foundation for A-shares to hit new highs The Pacific Securities believes that after ten years, the Shanghai Composite Index has once again seen 4000 points during trading. Although there was a break below on Tuesday, the breakthrough of the ten-year bottom provides a solid foundation for A-shares to hit new highs in the future. Any support after a pullback is a buying point from an index perspective; the Shanghai 50 Index is the most stable in terms of volume and price and is a more secure choice. The Fourth Plenary Session of the Central Committee of the Communist Party of China has catalyzed a sharp rise in the technology sector, and many star technology stocks have either reached new highs or are approaching previous highs. Investors without technology positions are not advised to chase after highs in times of high volatility at high levels. Sectors such as non-ferrous metals, coal, banks, nuclear power, and defense are still at low levels, and the bull market will smooth out every "dip," buying where no one cares and selling when it is crowded is a necessary condition for achieving excess returns. 2. Industrial: Focus on strategic layout around the Fifteen-Year Plan Industrial believes that with China-US trade negotiations, expectations of a Fed rate cut, the overseas turbulence may have gradually subsided; more importantly, the positive tone of the Fifteen-Year Plan boosts confidence, consolidates consensus, and solidifies the narrative of this round of the market turning positive in the medium to long term. The focus should still be on strategic layout around the Fifteen-Year Plan. Structurally, after the issue of the "rebalancing" brought about by previous risk-averse trading is gradually digested, the combination of favorable economic conditions, industry trends, and policy support should primarily focus on actively exploring opportunities in the technology growth industries, with a focus on AI, defense, and innovative drugs. 3. Orient: Reaching 4000 points does not mean the end of the market Orient believes that first of all, looking at the process, the previous two times the Shanghai Composite Index broke through 3000 points to reach 4000 points in less time, showing that this time it was prepared. Secondly, from a valuation perspective, although the number and market value of A-share listed companies have increased significantly, the overall valuation is lower than the previous two times. Thirdly, looking at the future trends, although there were setbacks after the last two breaks through 4000 points, they continued to rise within six months. This time, in the context of the technology-driven era, there is reason to go further. Overall, in the context of economic transformation, the importance of the capital market is highlighted, with favorable policies and funds. Combined with the industrial breakthroughs in the Fifteen-Year Plan, reaching the 4000-point mark does not mean the end of the market. The emergence of the "technology bull" driven by the industrial revolution in technology is slowly approaching. This article is reprinted from "Tencent Self-selected Stocks". Editor: Wang Qiujia.