CITIC Securities: Since the beginning of this year, the market driven by AI is not an internet bubble market. It is difficult for interest rate hikes to affect the valuation of "AI-type cyclical stocks".

Citic Securities research believes that the market driven by AI this year is driven by massive infrastructure investment, resembling the bull market driven by investment and heavy asset companies in 2006-07, rather than the internet bubble market. It is difficult for interest rate hikes to affect the valuation of "AI-related cyclical stocks" unless interest rate hikes actually affect AI terminal demand, commercialization assumptions, and capital expenditure growth. The interest rate hike process globally first affects sectors with relatively weak demand growth, and the K-shaped differentiation between AI and non-AI stands globally. However, as the strong dollar narrative begins to return and the market as a whole shows a pattern of structural adjustment of stock funds, A-share non-AI cyclical sectors are significantly weaker compared to their overseas counterparts. Similarly, there is K-shaped differentiation, but the breadth of the A-share market is relatively weaker compared to overseas markets. Changing the weakness of non-AI sectors will require positive changes in their own narratives in the future, or changes in the funding environment, rather than waiting for adjustments in AI.