Core Viewpoint - The A-share market is experiencing significant differentiation, with consumer stocks showing strong performance while AI computing and robotics sectors are under pressure [1][2][3]. Group 1: Consumer Stocks Performance - Consumer stocks such as Huanlejia (300997.SZ) and Sanyuan (600429.SH) have seen substantial gains, with Huanlejia rising by 19.99% to a price of 26.23 [2]. - Other notable consumer stocks include Baolingbao (002286.SZ) and Zhongliang Sugar Industry (600737.SH), both achieving a 9.99% increase [2]. - The rise in consumer stocks is attributed to supportive policies and positive macroeconomic data, indicating a potential recovery in consumer spending [3]. Group 2: Policy and Macroeconomic Data - The Ministry of Finance has announced continued efforts to boost consumption, including financial subsidies for personal consumption loans [3]. - October's CPI data shows a 0.2% month-on-month increase and a 0.2% year-on-year increase, with core CPI rising by 1.2%, marking the sixth consecutive month of growth [3]. - PPI has decreased by 2.1% year-on-year but shows signs of improvement, with a 0.1% month-on-month increase, the first rise this year [3]. Group 3: Market Outlook and Sector Analysis - Economic expert Pan Helin suggests that the active consumer sector is a response to policy support and previous underperformance, indicating a potential rebound [3][4]. - Despite the current pullback in AI and technology sectors, they remain the main focus of the ongoing bull market, with high demand for computing power from companies like OpenAI [4]. - Analysts from various securities firms suggest that while the market may experience short-term fluctuations, the overall trend remains bullish, with a focus on defensive and consumer sectors in the near term [4].

Investment Rating - The report maintains a "Positive" investment rating for the communication industry [10]. Core Insights - The communication sector has seen a 1.00% increase in the 45th week of 2025, ranking 15th among major industries in the Yangtze River region. Year-to-date, the sector has risen by 63.27%, placing it 2nd among the same industries [2][5]. - Lumentum's quarterly performance is strong, with revenue of $530 million for FY26Q1, a year-on-year increase of 58.4%. Over 60% of this revenue comes from cloud and AI infrastructure [6]. - The demand for indium phosphide (InP) laser chips is robust, with a supply-demand gap expected to widen to 25-30% in the coming quarters. Lumentum's production capacity is fully booked for the next six quarters, with an anticipated capacity increase of approximately 40% [6][8]. - The "AI x Space" initiative is accelerating, with companies like Starcloud, SpaceX, and Google launching projects to establish in-orbit computing capabilities, marking the beginning of a new era for space data centers [7][8]. Summary by Sections Market Performance - The communication sector's stock performance has been notable, with significant gains in individual stocks such as Keda (+24.6%), Yuanjie Technology (+16.2%), and Yihua Co. (+12.2%) [5]. Company Analysis - Lumentum's revenue growth is driven by strong shipments of InP laser chips, with component revenue reaching $380 million, a year-on-year increase of 64% [6]. - The company is transitioning from 3-inch to 4-inch wafer processes, focusing on cost and yield improvements [6]. Investment Recommendations - The report recommends several companies across different segments: - Telecom Operators: China Mobile, China Telecom, China Unicom - Optical Modules: Zhongji Xuchuang, Xinyi Technology, Tianfu Communication - Liquid Cooling: Yingweike - Hollow Core Fiber: Fenghuo Communication, Hengtong Optic-Electric - Domestic Computing: Runze Technology, Guanghuan New Network - AI Applications: Boshi Jie, Heertai - Satellite Applications: Huace Navigation, Haige Communication [8].

Report Industry Investment Rating No relevant content provided. Core Viewpoints of the Report - In a unilateral rising market, the momentum factor can amplify returns by concentrating on strong-performing stocks, resulting in significant excess returns. When combined with the growth factor, it can capture trends while adding a fundamental safety net to the investment portfolio, making it suitable for medium-risk preference investors. The "growth + momentum" dual-factor investment logic is systematically implemented in the ChiNext Momentum Growth Index and its linked product, the Huaxia ChiNext Growth ETF [1][11]. Summary According to the Directory Product Fund - Huaxia ChiNext Growth ETF (159967) - **Investment Attributes and Returns**: The Huaxia ChiNext Growth ETF closely tracks the ChiNext Momentum Growth Index, serving as a passive investment tool for high-growth and strong-momentum portfolios on the ChiNext board. Since its establishment in June 2019, it has achieved a cumulative return of 113.97%, significantly outperforming broad-based indices such as the CSI 300. In the rising market since May 2025, it has shown outstanding performance with a six-month return of 46.51%, demonstrating its offensive nature in a bull market. However, it has high volatility, with a three-year return of 1.10% significantly trailing the CSI 300's 22.70% [2][11][14]. - **Fund Manager and Fund Company**: The fund is managed by Rong Ying, who manages 21 funds with a total scale of approximately 138.292 billion yuan. As of October 22, 2025, the Huaxia ChiNext Growth ETF has a scale of 30.39 billion yuan. Huaxia Fund, the fund manager, has a total public fund management scale of 2041.571 billion yuan as of October 22, 2025, with 114 ETFs worth 896.351 billion yuan and 13 money market funds worth 774.607 billion yuan, consolidating its leading position in public offering index investment [15][19]. Tracking Index - ChiNext Momentum Growth Index (399296.SZ) - **Index Composition and Calculation**: The index is compiled by Guozheng Index Company, selecting 50 listed company securities with good growth ability and obvious momentum effects from the ChiNext board. It uses a Paasche weighting method with a single stock weight cap of 15% and adjusts samples and weights quarterly. The sample selection involves screening stocks based on liquidity and then using growth and momentum factors to calculate scores and determine the final 50 stocks [20][21][27]. - **Performance and Returns**: Since its release in 2019, the index has achieved a cumulative return of 157.46%, significantly higher than mainstream broad-based indices. In 2020, it had a return of 97.14%, showing high growth elasticity. In the period from May 1 to October 22, 2025, it had a cumulative return of 40.24%, also outperforming major broad-based indices [4][31][35]. - **Weighted Stocks and Industry Distribution**: The top ten component stocks account for 76.63% of the total weight, with high concentration in the technology growth sector. The top four industries (communications, power equipment, electronics, and non-bank finance) account for nearly 80% of the total weight, highlighting the index's focus on the technology growth sector [3][37][52]. - **Valuation and Earnings**: As of October 22, 2025, the index's PE TTM is 40.83 times, slightly lower than the historical median of 44.73 times, indicating a reasonable valuation. From 2019 to 2024, the index's component stocks showed strong growth in revenue and net profit, and it is expected to maintain double-digit growth from 2025 to 2026 [61][64]. - **Sources of High Growth and Excess Returns**: The index's high growth elasticity and excess returns stem from its precise sample screening, factor tilt weighting, high-growth and high-elasticity asset characteristics, and regular dynamic adjustments [71]. Sample Space - ChiNext Composite Index - **Market Value and Industry Structure**: The index shows a pattern where small-cap stocks dominate in number and large-cap stocks dominate in weight. The industry structure has been evolving towards power equipment, electronics, and communications, with the power equipment industry's weight increasing from 13.89% in 2020 to 23.46% in 2025, and the communications industry's weight rising from 2.90% to 9.69% [76][78]. - **Growth and Profitability**: The index has shown strong growth momentum in revenue, with its growth rate consistently higher than that of major market indices from 2020 to 2024. Its average net profit growth rate from 2020 to 2024 was 11.73%, significantly higher than that of mainstream broad-based indices. The average ROE in the past five years was 6.86%, indicating relatively good profitability [79][81][83]. - **Industry Focus and New Productivity Layout**: The index's industry structure focuses on technology growth, with a low financial sector weight and high weights in emerging technology fields such as communications and computers, reflecting the trend of new productivity development and industrial upgrading [88].

Group 1 - The MACD golden cross signal has formed, indicating potential upward momentum in certain stocks [1] - A-share computing power concept stocks have experienced declines, with Tianfu Communication dropping over 8%, Cambrian-U falling over 5%, and Hongxin Electronics, Zhongji Xuchuang, and Industrial Fulian each decreasing over 4% [1]

Group 1 - The core viewpoint indicates a decline in the AI concept stocks on the ChiNext board, with Tianfu Communication dropping over 8%, Zhongji Xuchuang falling over 4%, and Xinyi Sheng decreasing over 3% [1] - The ChiNext AI-related ETFs experienced a decline of approximately 3% [1] - Specific ETF performance includes: Guotai ETF down 3.21% to 1.716, Nanfang ETF down 3.17% to 1.800, and Dacheng ETF down 3.01% to 1.417 [2] Group 2 - Analysts suggest that the AI application ecosystem is becoming increasingly complete, with rapid penetration of large model technology in vertical fields such as finance, healthcare, and education, exceeding market expectations [2] - With increased policy support and accelerated domestic computing power construction, leading companies in the AI industry chain are expected to continue benefiting [2]

Core Viewpoint - The stocks of Tianfu Communication and Tengjing Technology fell over 8%, with Cambridge Technology, Jingwang Electronics, Shenghong Technology, Zhongji Xuchuang, and Industrial Fulian also experiencing significant declines [1] Group 1 - Tianfu Communication and Tengjing Technology saw a drop exceeding 8% in their stock prices [1] - Cambridge Technology, Jingwang Electronics, Shenghong Technology, Zhongji Xuchuang, and Industrial Fulian were among the companies with the largest declines [1]

Core Insights - Zhongji Xuchuang's stock price decreased by 5.03% to 465.33 CNY per share, with a trading volume of 11.98 billion CNY and a turnover rate of 2.24%, resulting in a total market capitalization of 517.04 billion CNY [1] Company Overview - Zhongji Xuchuang Co., Ltd. is located in Longkou City, Shandong Province, established on June 27, 2005, and listed on April 10, 2012 [1] - The company's main business involves the research, design, manufacturing, sales, and service of motor stator winding equipment and optical module equipment [1] - The revenue composition of the company is as follows: optical communication transceiver modules account for 97.58%, automotive electronics 1.74%, and optical components 0.67% [1] Fund Holdings - According to data from the top ten holdings of funds, one fund under Ruida holds shares in Zhongji Xuchuang [2] - Ruida Advanced Manufacturing Mixed Fund A (018226) held 2,900 shares in Zhongji Xuchuang, representing 3.45% of the fund's net value, ranking as the tenth largest holding [2] - The fund has experienced a floating loss of approximately 71,500 CNY today [2] - Ruida Advanced Manufacturing Mixed Fund A was established on April 14, 2023, with a latest scale of 15.18 million CNY, and has achieved a year-to-date return of 45.8%, ranking 1374 out of 8147 in its category [2] - Over the past year, the fund has returned 39.61%, ranking 1220 out of 8056, and since inception, it has returned 40.62% [2] - The fund manager, Zhang Xiying, has been in position for 1 year and 183 days, with total assets under management of 108 million CNY, achieving a best return of 97.45% and a worst return of 3.16% during the tenure [2]

Core Viewpoint - The A-share market experienced fluctuations around the 4000-point mark, with significant movements in the new energy sector, particularly in photovoltaic and superhard materials, leading to notable stock performances [1][2]. New Energy Sector - The new energy sector saw a strong surge, with the photovoltaic segment leading the way, particularly in perovskite batteries and HJT batteries, resulting in multiple stocks hitting the daily limit up [7][9]. - Key stocks included Zhonglai Co., Ltd. (300393) with a 20.06% increase, and several others like Tuojin New Energy (002218) and Xiexin Integration (002506) achieving around 10% gains [8]. Superhard Materials Sector - The superhard materials sector experienced a collective rise, with the cultivated diamond concept stocks increasing by over 10%, driven by a recent announcement from the Ministry of Commerce and the General Administration of Customs regarding the suspension of export controls on related items [3][4]. - Notable performers included Sifangda (300179) with a 19.99% increase and Huifeng Diamond (920725) with a 17.05% rise [4]. Storage Chip Sector - The storage chip concept stocks continued to strengthen, with Jiangbolong (301308) rising by 11.31%, reaching a new historical high [13][14]. Industrial Robotics - The market share of domestic industrial robots in China has surpassed 50% for the first time, reaching 58.5%, with a projected annual growth rate of 33.1% during the 14th Five-Year Plan period [16].

Core Viewpoint - The market for computing power hardware is expected to remain strong in the coming years, despite short-term fluctuations, driven by key indicators such as CAPEX, token consumption, and ARR [1][3]. Group 1: Market Performance - On the morning of the 11th, computing power stocks opened high but fell, with optical module stocks like Tianfu Communication dropping over 7% and Zhongji Xuchuang down over 4% [1]. - The AI ETF (159363) experienced a peak followed by a decline, with an intraday drop of over 2% and a real-time transaction volume exceeding 3.8 billion CNY, indicating a buying interest of over 60 million shares during the dip [1]. Group 2: Investment Recommendations - Companies are advised to focus on core opportunities in optical modules and computing power, particularly the first AI ETF tracking the ChiNext AI Index (159363), which has over 54% exposure to leading optical module companies [3]. - The AI ETF has a recent scale exceeding 3.5 billion CNY, with an average daily trading volume of over 700 million CNY in the past month, ranking first among seven ETFs tracking the ChiNext AI Index [3].

Market Overview - The three major indices collectively adjusted, with the Shanghai Composite Index down 0.38%, the Shenzhen Component down 0.52%, and the ChiNext Index down 0.74% [1] - The total trading volume in the Shanghai and Shenzhen markets was 12,680 billion yuan, a decrease of 1,864 billion yuan compared to the previous day [1] - Over 2,900 stocks in the market rose [1] Sector Performance - The sectors that saw the highest gains included cultivated diamonds, photovoltaic equipment, battery chemicals, gas, pharmaceutical commerce, and non-ferrous metals [1] - Conversely, sectors that experienced the largest declines included coal mining and processing, insurance, liquor, AI corpus, computing power hardware, and securities [1] Notable Stocks - The cultivated diamond and superhard materials sectors saw a collective surge, with Sifangda hitting the daily limit up, and Huanghe Xuanfeng also closing at the limit [1] - Huifeng Diamond, Power Diamond, and World Diamond saw intraday increases of over 10% [1] - The battery industry chain strengthened again, with upstream material stocks leading the gains; Fangyuan Co. hit the daily limit up, while Tianji Co., Shida Shenghua, Penghui Energy, and Xinzhou Bang were among the top gainers [1] - The photovoltaic equipment sector was also active, with Aters reaching a new high, and Guosheng Technology and Jincheng Co. achieving consecutive gains [1] - On the downside, several computing power hardware stocks fell, with Tianfu Communication down over 7%, and Cambridge Technology, Shenghong Technology, Zhongji Xuchuang, and Industrial Fulian also experiencing declines [1]