Huatai Securities: The current adjustment of A-shares is the result of both the clearing of crowdedness and the switch to mid-year pricing, rather than a refutation of industry logic.

Huatai Securities pointed out that last week, A-shares showed volume differentiation, with global AI funds rebalancing from high-end hardware to low-end applications and Chinese assets. A-shares simultaneously showed both high and low points, with a defensive advantage. Huatai Securities believes that this round of adjustment is a combination of crowding out and switching to mid-year report pricing, rather than a refutation of industrial logic. Looking ahead, the spread between IC/IM futures has significantly narrowed, and pessimistic expectations have been released. In terms of rhythm, next week will enter a window of Longxin's subscription and intensive disclosure of mid-year reports, where technology may maintain high volatility, and the landing of IPOs combined with performance validation windows may provide opportunities for bottom-fishing. In terms of operations, continue with balanced allocation. On the technology side, it may be beneficial to buy into sub-sectors such as storage, semiconductor equipment/materials during the subscription window when profit expectations are still upward. In addition, increase allocation in industries with relatively conservative pricing expectations, such as coal and commercial vehicles. Continue to hold dividends.