Group 1 - The report discusses the conditions for breaking through the consolidation range in the market, indicating that historically, the end of a bear market often leads to a consolidation phase before a bull market begins. The conditions for breaking through this range align with those for confirming a bull market [3][4][7]. - Since 2024, the A-share index has established a new consolidation range, with historical examples showing that once this range is broken, it typically signals the start of a major bull market. The report emphasizes the need for three key elements: continuous inflow of incremental capital, cyclical and structural improvements in the fundamentals, and optimistic expectations for a bull market [4][8][9]. Group 2 - The short-term rebound in the A-share market is supported by a "wall of isolation" against macroeconomic disturbances, which reduces significant downside risks. This environment allows the market to attempt structural breakthroughs, particularly in new consumption and technology sectors [11][12]. - Core targets within the new consumption sector, such as jewelry, trendy IP toys, new snacks, and beauty products, continue to thrive within their respective growth trends. However, the report advises caution regarding the broader consumption expansion, as significant profit effects in new consumption often signal short-term adjustments [12][17]. Group 3 - The report maintains a mid-term structural view that the A-share market will return to a structural bull phase, relying on breakthroughs in technology sectors. Short-term rebounds in technology stocks are noted, but the market has not yet escaped the adjustment phase [12][19]. - The report highlights that new consumption is creating demand and is a key trend as household spending patterns shift. The expansion of new consumption into the broader consumption landscape is seen as a rational outcome based on fundamental trends, but caution is advised regarding the sustainability of this expansion [12][17].

Group 1 - The core viewpoint is that the banking sector is expected to see a performance turning point due to the accumulation of positive fundamental factors, supported by recent financial policies and stable interest margins [1] - The recent asymmetric interest rate cuts on deposits and loans have stabilized bank interest margins, providing a supportive environment for performance recovery [1] - The public fund allocation is expected to recover, accelerating the realization of bank dividend value in the medium to long term [1] Group 2 - The market is experiencing rapid rotation between large-cap and small-cap stocks, suggesting a need to focus on three main investment themes [2] - The first theme is to invest in assets with high safety margins, particularly dividend-paying sectors that offer stable returns amid increased external uncertainties [2] - The second theme emphasizes the technology sector, which remains a long-term investment focus, with short-term attention on undervalued sub-sectors [2] - The third theme highlights the consumer sector, which is expected to benefit from policy support and the ongoing importance of boosting domestic demand [2] Group 3 - The pharmaceutical sector is expected to prioritize innovative drugs, with a focus on consumption recovery as the industry progresses towards innovation by 2025 [3] - The aging population and unmet clinical needs are driving growth in the pharmaceutical industry, alongside improving innovation capabilities [3] - The pharmaceutical sector is anticipated to return to stable growth, particularly with the emergence of innovative drugs and the normalization of medical compliance [3]

Core Viewpoint - The market is expected to remain in a high central oscillation phase during Q2, with short-term adjustments anticipated due to increased uncertainty in the U.S. economy and limited expansion space for new consumption [1][2][3]. Group 1: Market Conditions - Q2 is characterized as a high central oscillation market, with short-term adjustments expected [2]. - The upper limit of the oscillation range is supported by a combination of wide monetary policy and external demand improvements, but concerns about economic downturns remain [2][3]. - The lower limit is influenced by the timely implementation of monetary policies and the role of stabilization funds in managing market sentiment [2][3]. Group 2: Sector Analysis - Technology and consumer sectors are currently not positioned to lead market breakthroughs, with technology still in a mid-term adjustment phase [2][4]. - New consumption trends are facing limitations in expanding outward due to reduced internal demand stimulus [2][4]. - The pharmaceutical sector (CXO and innovative drugs) and precious metals are expected to continue their positive trends in the short term [4]. Group 3: Fund Management and Market Dynamics - The recent trend of public funds aligning with performance benchmarks has concluded, with potential for a new round of market dynamics in June [5]. - Fund managers are encouraged to reassess their benchmark choices, as the alignment with performance benchmarks may not be suitable for all [3][4]. - The potential inflow of funds into sectors such as non-banking, banking, construction, public utilities, and coal is noted, although actual inflows remain low relative to market capitalization [3]. Group 4: Profitability and Economic Outlook - A general expectation is that A-shares will struggle to see a significant uptick in profitability until 2025 [2]. - The mid-term outlook for A-shares relies heavily on breakthroughs in the technology sector, particularly in AI, embodied intelligence, and defense industries [4]. - The combination of new merger regulations and venture capital financing is anticipated to contribute positively to high-growth segments of the new economy [4]. Group 5: Market Sentiment Indicators - The market sentiment indicators show varying levels of profitability across sectors, with banking at 97% and consumer sectors like beauty care and pharmaceuticals showing moderate expansion [8]. - Sectors such as public utilities and basic chemicals are experiencing contraction, indicating a need for focused investment strategies [8]. - The overall A-share market sentiment is showing signs of contraction, with only 42% of stocks indicating profitability expansion [8].

Group 1 - The article emphasizes that the economic data validates the previously low expectations, indicating limited room for further downward adjustments [3] - The article discusses the potential for a strategic opportunity shift, with expectations for a comprehensive bull market by 2026 [7] - The article highlights the impact of U.S. tariffs on China, suggesting that the threat may dampen risk appetite, particularly with a sensitive window in Q2 2025 [8] Group 2 - The pharmaceutical sector has experienced four consecutive years of negative returns, but there is a significant probability of a sector rotation reversal in 2025 [9] - The article notes that while short-term sentiment indicators are high, overall market liquidity has not reached previous peaks, suggesting a cautious long-term outlook amidst rising technology industry trends [11] - The article outlines a cautious investment strategy for U.S. stocks, recommending hedging and timely profit-taking during potential rebounds, particularly in the tech sector [14]