A-share market midday review | Adjustment in the index, GEM fell by 1.46% in half a day, strong positive news coming, power stocks surged against the trend.

A-shares weakened and adjusted, with the Shanghai Composite Index fluctuating narrowly in the morning and the ChiNext Index falling by more than 1%. By midday, the Shanghai Composite Index fell by 0.17%, the Shenzhen Component Index fell by 0.68%, and the ChiNext Index fell by 1.46%. The total turnover of the Shanghai and Shenzhen stock exchanges in the morning was 1.59 trillion, a decrease of 53 billion from the previous trading day. It is worth noting that multiple positive factors have emerged, with the power and power grid equipment concepts becoming active again. The stocks of Jiangxi Ganneng, Henan Yuneng Holdings, and DaTang HuaYin Electric Power all rose rapidly, with Chongqing Fuling Electric Power Industrial and Gepic Energy Development experiencing significant increases. According to Securities China, in addition to the recent announcement by the National Energy Administration of the list of pilot projects for the improvement of new power system construction capability, there is another very strong logic emerging. There are reports that China's AI call volume has surpassed the United States, with four large models ranking in the top five globally. The call volume for tokens is linked to power and computing power. With China's low electricity prices, companies can achieve overseas expansion through token call volumes. Furthermore, the HALO trading strategy, which stands for Heavy Assets, Low Obsolescence, has also bolstered the power sector. The HALO strategy believes that AI technology is disrupting the light asset industries such as software and IT services, leading to a significant demand for physical assets such as power, energy, and hardware. Investors are thus seeking companies with high barriers to entry in physical assets that are not easily replaced by technology as a "safe haven." In terms of the market, the computing power leasing sector continued to strengthen, with Yun Tian Li Fei rising by over 15%, Beijing Teamsun Technology and Talkweb Information System hitting the limit up. The AI programming concept became active at the beginning of the session, with Shanghai New Centurion Network Information Technology and Primeton Information Technologies, Inc. hitting the limit up. The non-ferrous metals sector continued to be strong, with stocks like Guangdong Orient Zirconic Ind Sci & Tech and China Rare Earth Nonferrous Metals hitting the limit, while the photovoltaic concept rose, with companies like Hainan Drinda New Energy Technology and Shuangliang Eco-Energy Systems hitting the limit. The fiber optic concept fluctuated upward, with Fiberhome Telecommunication Technologies and Hangzhou Cable hitting the limit up. The steel sector experienced a fluctuating rise, with Hang Zhou Iron & Steel hitting the limit up. The rare earth concept was on the rise, with China Rare Earth Nonferrous Metals hitting the limit, and the commercial aerospace concept fluctuated upward, with companies like Finework (Hunan) New Energy Technology and Beijing Highlander Digital Technology rising by over 10%. The diversified financial sector also saw a fluctuating rise, with Nanhua Futures hitting the limit up. In terms of declines, most AI hardware stocks retraced, with sectors like optical modules, PCBs, and fiberglass weakening, and Grace Fabric Technology hitting the limit down. The papermaking concept weakened, with companies like Zhejiang Hengda New Material and Wuzhou Special Paper Group falling by over 7%, and the real estate sector showed weak performance, with China Union falling by nearly 7%. Additionally, sectors like insurance, complete vehicles, oilfield services, and batteries performed poorly. Looking ahead to the future, Orient believes that the market rotation has accelerated since the beginning of the year, with the underlying trend being the reduced risk appetite in the market. While there is still potential for the stock index to rise, stocks that have shown overly strong short-term performance may need to be reduced. China Securities Co., Ltd. stated that they are particularly optimistic about the reversal opportunities in the heavy asset industry. Popular Sectors 1. The power and power grid equipment sector is becoming active again, with companies like Jiangxi Ganneng seeing continuous gains. 2. The non-ferrous metals sector is becoming active again, with companies like Chongyi Zhangyuan Tungsten leading the way. 3. The space photovoltaic concept continues to strengthen, with companies like Hainan Drinda New Energy Technology and Shuangliang Eco-Energy Systems hitting the limit up. 4. The computing power hardware sector is seeing retracements, with companies like Grace Fabric Technology hitting the limit down. Institutional Views - Orient: The market risk appetite is decreasing, but the stock index still has potential to rise. - EB SECURITIES: The transition to a double control of energy consumption to carbon emissions will lead to a reassessment of carbon costs, with a focus on non-electrical applications of green electricity.