A-share midday review | Volume adjustment of the index, nearly 4000 stocks in the whole market fell, medical stocks rose against the trend.

On December 2nd, the early market was weak, with all three major indexes collectively falling. By the close of trading, the Shanghai Composite Index fell by 0.55%, the Shenzhen Component Index fell by 0.77%, and the ChiNext Index fell by 0.88%. The total turnover in the Shanghai and Shenzhen markets reached 1.05 trillion yuan for the morning session, a decrease of 179.6 billion yuan from the previous trading day. Nearly 4,000 stocks in the market fell. In terms of the market, sector rotation was weak, with Fujian and the Taiwan Strait seeing significant gains, with stocks like HaiXin Foods, Zhongfu Straits, and Fujian Rongji Software all hitting the limit up. The retail sector fluctuated higher, with Maoye Commercial hitting the limit up. The AI mobile phone concept remained active, with Daoming Optics & Chemical and Sichuan Furong Technology hitting the limit up. The commercial aerospace concept strengthened again, with Addsino Co., Ltd. and Tongyu Communication Inc. hitting the limit up. Real estate stocks rose, with Shenzhen Worldunion Group Incorporated briefly hitting the limit up. Some mining hardware stocks rebounded, with Sai MicroElectronics Inc. rising by more than 14% at one point, reaching a new high. The ice and snow industry concept fluctuated upwards, with Bingshan Refrigeration & Heat Transfer Technologies hitting the limit up. Additionally, the shipping, pharmaceutical commerce, new energy vehicles, and Hainan Free Trade Zone concepts all saw some performance. In terms of declines, the non-ferrous metals sector collectively retreated, with Guangxi Huaxi Nonferrous Metal falling by over 7%. The battery industry chain had a weaker trend. The AI application concept fluctuated downwards, with Shifeng Cultural Development and Omnijoi Media Corporation falling by over 7%. The CRO sector declined, with Shanghai InnoStar Bio-tech falling by over 7%. Additionally, the oil and gas, Siasun Robot & Automation, and chemical sectors did not perform well. Looking ahead, China Galaxy Securities stated that the market is still in a phase of frequent style changes in December, with structural market trends likely to dominate. They suggest focusing on defensive sectors for opportunities in the year-end style rotation and positioning for next year's economic outlook. Popular Sectors: 1. Pharmaceutical Commerce on the Rise The pharmaceutical commerce sector continued to rise, with Shenzhen Neptunus Bioengineering hitting 5 consecutive limit ups, HPGC Renmintongtai Pharmaceutical Corporation hitting the limit up, and Sichuan Hezong Medicine Easy-To-Buy Pharmaceutical, Cowealth Medical China, and others following suit. 2. Strong Performance in Fujian Stocks Local stocks in Fujian showed strong performance, with Zhongfu Straits and Fujian Rongji Software hitting the limit up, Strait Innovation Internet rising by over 10%, and Fujian Zhangzhou Development, FULONGMA GROUP, and Xiamen XGMA Machinery following suit. Institutional Views: 1. China Galaxy: Focus on Defensive Sector Opportunities in the Market China Galaxy Securities believes that the market is still in a phase of frequent style changes in December, with structural market trends likely to dominate. They suggest focusing on defensive sectors for opportunities in the year-end style rotation and positioning for next year's economic outlook. 2. Shenwan Hongyuan Group: Effective Rebound in Attacking Assets Likely, but Logic for Breakthrough is Difficult to Realize Shenwan Hongyuan Group believes that an effective rebound in attacking assets (technology and cyclical stocks) is likely to occur, but the logic for a breakthrough is difficult to realize, and the upper limit of the spring market rally is not high. 3. Industrial: Focus on Overseas Disturbances Easing, Continue Positioning for Recovery in Chinese Assets Industrial believes that with previous disturbances gradually fading, the market may enter a new phase. They suggest maintaining a bullish mindset and continuing to position for the recovery of Chinese assets.