CITIC Securities: Style Rebalancing has actually begun

CITIC Securities released a research report stating that the recent cooling down of the technology sector may be related to the upcoming listing of Changxin Technology and the slowdown in the growth rate of ARR of overseas model giants. The market is concerned about two things: first, there is concern that the listing of Changxin Technology may cause significant short-term impact on the liquidity of the domestic technology sector, leading investors to reduce positions early; second, there is concern that the speed and space for commercial realization of model giants may be downgraded. In addition, there are accumulating concerns at a macro level. Although the media frequently releases information about a potential ceasefire agreement between the US and Iran, Iran's strong attitude recently seems to indicate that Iran wants to reshape its geopolitical position and discourse power in the Middle East. Regardless of whether a US-Iran agreement can be reached quickly, its impact on the market is different from that in April and May: if reached, the global industrial production recovery will change the macroeconomic situation of sustained weakness in the "non-AI" field, leading to a short-term correction in K-shaped differentiation; if prolonged, the increase in inflation and tightening expectations may have a negative emotional impact on overseas technology sectors. With the slowdown in the speed of large fund reduction and the weakening of selling pressure, the A-share market has begun to balance in terms of funding, and non-popular sectors are starting to recover. CITIC Securities believes that the style re-balancing has already begun in reality, but in terms of allocation, it is still necessary to focus on directions with clear performance logic, rather than switching for the sake of switching.