A-shares opening news: A-shares collectively opened lower, with the Shanghai Composite Index falling by 0.37%. The oil and gas sector and other related sectors are showing strength.

On May 18, the three major A-share stock indexes collectively opened lower, with the Shanghai Composite Index falling by 0.37% and the Growth Enterprise Index falling by 0.87%. On the market, the oil and gas sector was active, with Tong Petrotech Corp. rising by nearly 3%; while precious metals, photovoltaic, and other sectors led the declines. Institutional Views on the Market CITIC SEC: How to adjust? Rebuilding a barbell structure CITIC SEC believes that the funds driving this round of structural bull market mainly come from stock adjustments and inflows from financing plates. After TMT turnover ratio peaked, we estimate that the turnover rate for the entire A-share market will gradually fall below 1.8%. Trump's visit to China has established a framework for Sino-US relations to return to "competition without conflict." However, market sentiment may be at a temporary high point. Once sentiment falls, expectations of global liquidity tightening will begin to increasingly influence investors' decisions. After the cooling off period, the market's diversified structure is expected to return, and the need to return to a barbell structure will increase. It is expected that AI+ energy will be a more suitable structure this year. We recommend focusing on the most in-demand links in the supply chain, as reflected in recent price increases in copper-clad laminates, fiberglass, high-speed silicon, electronic special gases, optical fibers, MLCC, chromium, lithium carbonate, rare earths, and carbon fibers. For traditional cyclical products, it is recommended to focus on varieties where systemic capacity clearance has actually occurred or where supply is absolutely constrained, such as phosphate chemicals, MDI, spandex, dyes, glyphosate, urea, rubber, and refrigerants. Huaan: Adjustment is an opportunity Huaan stated that April's US inflation exceeded expectations, with Kevin Warsh, who emphasized controlling inflation as the main goal, officially taking office as Chairman of the Federal Reserve. Milan, a dovish director, resigned from the Federal Reserve, leading the market to bet that the Fed may accelerate its shift towards a hawkish stance, temporarily suppressing global market risk appetite. April's inflation data continued to improve, but mainly due to input factors, domestic demand still needs to be boosted, as confirmed by the credit weakness in financial data. However, considering the current strong exports, the overall price level has not changed, and the necessity of implementing loose monetary policy tools has further decreased, with the monetary policy implementation report indicating an intention to tighten liquidity marginally. Therefore, in the short term, one should be cautious about the possibility of liquidity shocks. In terms of allocation, the AI industrial chain recently experienced overheated trading followed by a cooling off period, but this adjustment is only temporary. In the medium term, it is recommended to seize the opportunity of adjustment and actively participate, continuing to focus closely on core industries: embracing the entire AI industrial chain, especially focusing on computing power and supporting facilities. Secondly, emphasize industries with strong alpha effects and in bullish areas, including energy storage chains, mechanical equipment, storage and semiconductor equipment, and military industries. Industrial: "Summer Chill", Three Strategies to Address Industrial believes that after the short-term "chill," the "midsummer" and "late autumn" are more worth looking forward to. 1) Stick to long-term positions, continue to focus on sectors with the most certainty in prosperity such as optical communications, which have historically shown to be resilient in market fluctuations caused by external disturbances. 2) Diffuse strong trends, continue to explore niche opportunities within the AI industry. 3) If wanting to respond to market concerns, new and old energy sources are a good hedge choice. In terms of direction, combining the magnitude of gains and losses, the level of prosperity, and subsequent catalysts since this round of the market, emphasize the diffusion of the AI trend into upstream basic infrastructure (electric power grids, optical fiber cables, computing power leasing, liquid cooling), downstream hardware (consumer electronics, Siasun Robot&Automation, commercial aerospace), and downstream applications (games, film and TV, advertising and marketing). This article is reprinted from "Tencent Stock Picks." Editors: Feng Qiuyi.