CITIC Construction Investment: The recovery of the A-share tech sector is relatively slow, mainly due to the crowded trading, financing pressure, and regulatory cooling that have accumulated from prior rapid increases, rather than a reversal in industrial trends.

CITIC Construction Investment released a research report stating that the global tech deleveraging essentially came to an end by the end of July. Overseas tech sectors have begun to recover first, aided by easing macro constraints and the validation of industry prosperity, shifting the market from capital-driven pricing back to fundamentals-driven pricing. The recovery in A-share tech is relatively slow, mainly due to the crowding of trades accumulated from previous rapid gains, pressure from financing, and regulatory cooling, rather than a reversal in industry trends. Historical experience shows that the structure of capital primarily affects market rhythm, while the medium-term direction is still determined by performance realization. Currently, the demand in the computing power industry chain remains resilient, and the recovery of A-share tech is not yet over. In terms of allocation, priority should be given to core assets with higher certainty in fundamentals, while also paying attention to innovative drugs and industrial metals. Key sectors to focus on include: optical communications, servers, innovative drugs, non-ferrous metals, machinery, and new energy.