Huatai Securities: Managing Uncertainty with Position Control and Individual Stock Research

Huatai Securities pointed out that last week, A-shares traded with shrinking volume and volatility. From the perspective of market trading structure and fund behavior, overall risk appetite has cooled down, while geopolitical risks and rising oil prices are still the core contradictions in market pricing. Looking ahead, on a macro level, short-term risks have not been completely released, global stagflation concerns are rising, domestic broad liquidity is abundant, but the sustainability of improvements in import and export data and inflation data remains to be verified. On a micro level, global investors still have concerns about the disruptive impact of AI, and the most important financial reporting season of A-shares for the year is approaching, with a focus on the AI chain and resources. Currently, visibility on both macro and micro levels is relatively low, so it is recommended that investors reduce their positions and be flexible in their responses. In terms of allocation, seek out alpha in the power chain and essential consumer goods. In addition, as valuation pressures gradually dissipate, the upstream hardware in the computing power chain with short-term catalysts may offer high-risk returns, allowing for buying on dips and selling on rallies.