Core Viewpoint - The A-share market experienced fluctuations, with only the Shanghai Composite Index closing in the green, driven by the banking sector's strong performance [1][2]. Group 1: Banking Sector Performance - The banking sector's total market capitalization reached 15.95 trillion yuan, an increase of 2.37 trillion yuan since the beginning of the year, with the banking index rising by 15.63% [6][9]. - Analysts attribute the strong performance of the banking sector to three main factors: liquidity support from state-owned entities, continuous inflow of long-term funds, and expectations from public fund reforms [9][12][13]. - The banking sector is seen as attractive due to its large market capitalization, stable earnings, and high dividend yield, which enhances its appeal to investors [8][18]. Group 2: Investment Opportunities - Despite the recent rise, the banking sector is considered to have room for further valuation recovery, as it is currently at a moderate level compared to previous highs [15][17]. - The central bank's intention to strengthen monetary policy and the potential for interest rate cuts may further enhance the attractiveness of bank dividends [17][18]. - Investors are advised to adopt a balanced investment strategy, gradually building positions to enjoy long-term investment benefits while avoiding concentrated bets on a single sector [19]. Group 3: Tariff Developments and Market Impact - The upcoming expiration of tariff exemptions on July 9 is expected to create uncertainty in the market, particularly affecting sectors sensitive to tariffs, such as technology and home appliances [22][24]. - If tariff exemptions are not extended, Chinese exports may face increased cost pressures, potentially leading to short-term foreign capital risk aversion [24]. - Long-term, the expiration of tariff exemptions is not expected to alter the trend of upgrading China's manufacturing sector, with leading companies maintaining their competitive edge [24][25]. Group 4: Sector Focus - The technology sector is likely to face short-term pressure due to tariff sensitivities, while banking and dividend-focused sectors may become preferred options for risk-averse investors [25][26]. - Precious metals and rare earth sectors are expected to see a reassessment of their value due to geopolitical risks and expectations of a weaker dollar [26].