Macro Environment - The macroeconomic data for October shows a weak recovery, with the manufacturing PMI at 49%, down 0.8 percentage points from September's 49.8% [5][11] - The "Four Central Committee" meeting established the development direction for the 14th Five-Year Plan, emphasizing the expansion of domestic demand and the construction of a modern industrial system [5][11] - The Producer Price Index (PPI) decreased by 2.3% year-on-year, with the decline narrowing for two consecutive months, indicating some price recovery [5][11] Market and Industry Performance - In October, the bond market saw a rebound, with the 10-year government bond futures index rising by 0.74% and the 30-year index by 2.35% [5][43] - The equity market favored value over growth, with the Shenwan style index showing a rise in cyclical sectors by 3.23% and financial real estate by 1.98%, while technology (TMT) fell by 3.01% [5][48] - The top-performing industries in September included coal (10.02%) and steel (5.16%), while electronics (-3.53%) and automobiles (-3.58%) lagged [5][54] Monthly Allocation Recommendations - For November, the recommendation is to maintain low-volatility assets as a basic allocation, with potential adjustments to increase exposure to technology if valuations improve after corrections [5][63] - Key sectors to focus on include brokerage, insurance, banking, and pharmaceuticals [5][64] Current TMT Sector Status - The TMT sector has experienced multiple wave cycles from 2005 to 2025, with lower valuation stocks generally outperforming higher valuation ones [5][67] - The electronic industry shows a high PE ratio of 81.42, indicating relatively high valuations compared to historical extremes [5][73] - The relationship between inventory cycles and index performance in the electronic sector is complex, with cash flow growth not consistently aligning with index peaks [5][73]