Fangzheng Securities: The probability of further extreme stylization in the future is not high.

Fangzheng Securities stated that the necessity of style rebalancing has further increased, with the current value/growth ratio reaching the bottom area, indicating that the probability of continued extreme stylization is small. Looking at the potential direction of rebalancing, it is still focusing on industries with better mid-year performance expectations for rebalancing, rather than simply "high cutting low" in any industry. Some industries that were mistakenly hit before due to the siphoning of technology funds, such as securities, chemicals, innovative drugs, and AI applications, have seen a recovery in the past week. In addition, after the release of US PCE data, the Fed's expected interest rate hikes for the year have shifted back slightly, and with oil prices falling, the most pessimistic expectations of interest rate hikes may already be over, which is a good thing for style rebalancing. On the other hand, technology is currently in a period of observation, with the earlier strong rise in hardware prices further spreading. However, after the announcement of Micron's financial report, the market began trading as storage costs increased, squeezing the profit space of other links in the industry chain. The focus will be on the guidance provided by major US CSP factories in the mid to late July financial reports.