CITIC Securities' Huang Wentao: Silicon-based industries continue to be highly prosperous, domestic demand awaits policy support.

CITIC Construction Investment analyst Huang Wentao released a research report stating that June data shows a slight improvement in the growth rate, but structural differentiation has not been reversed yet. The deepening of K-shaped differentiation is reflected in four aspects: production is stronger than demand, external demand is stronger than internal demand, high technology is stronger than traditional sectors, and short-term financing is stronger than long-term financing. The recent policy direction is more in line with current contradictions. The policy focus is on improving consumer power, revitalizing urban stock, and building modern infrastructure. Urban renewal and the "Six Sheet Network" are expected to support investment, while consumption and employment policies determine the sustainability of domestic demand repair. High-tech manufacturing, modern services, and related external demand continue to strengthen. Industrial and service production are accelerating simultaneously. The manufacturing PMI rose to 50.3% in June. In the first half of the year, the value added of equipment manufacturing and high-tech manufacturing increased by 9.3% and 13.3% respectively. Industrial robots, lithium-ion batteries, and 3D printing equipment continue to grow at a high rate, with the information communication industry growing by 10.7%. At the same time, the export structure is further tilting towards technical products. The export of electromechanical products increased by 20.1%, accounting for over 60% of total exports. Silicon-based productivity remains the main driver of output, profits, and external demand.