Core Viewpoint - The military industry sector is experiencing renewed activity, with significant stock price increases for companies like Aerospace Intelligence and Jiayuan Technology, driven by upcoming events such as military parades and the "Five-Year Plan" meeting [1][2]. Group 1: Market Activity - The military sector saw stocks like Aerospace Intelligence rise nearly 18%, with Jiayuan Technology increasing over 10%, and Changcheng Military reaching a new historical high [1]. - The current market congestion in the military sector is at a moderate level, making it a suitable area for investment within the growth theme [1]. Group 2: Catalysts for Growth - Historical events, such as military parades, have been significant catalysts for the military sector's performance, with past parades leading to substantial stock gains [1]. - The upcoming "Five-Year Plan" meeting is expected to provide a boost to the military sector, as historical data shows that military stocks tend to outperform other sectors leading up to such meetings [1][2]. Group 3: Long-term Outlook - The military industry is poised for a new round of order releases, supported by both domestic planning and international competitive dynamics [2]. - The military sector's performance is closely tied to the execution of the "Fourteenth Five-Year Plan" and the preparation for the "Fifteenth Five-Year Plan," which is expected to clarify development directions and release pent-up demand [2]. - The global arms race and China's increasing competitiveness in international military trade are anticipated to expand market opportunities for the military sector [2].

Market Performance - On July 1, the major stock indices in Shanghai and Shenzhen opened mixed, with the Shanghai Composite Index slightly higher and the Shenzhen Component and ChiNext Index also opening with minor gains. The Shanghai Composite Index showed a fluctuating upward trend throughout the day, closing at 3457.75 points, up 0.39%, marking a new year-to-date closing high [1] - The Shenzhen Component Index closed at 10476.29 points, up 0.11%, while the ChiNext Index closed at 2147.92 points, down 0.24%. The total trading volume for the Shanghai market was approximately 553.6 billion yuan, and for the Shenzhen market, it was about 912.5 billion yuan [1] Sector Performance - The pharmaceutical sector led the gains, with significant increases in various sub-sectors such as immunotherapy, innovative drugs, recombinant proteins, generic drugs, weight loss drugs, hepatitis concepts, and hair medical treatments. Other sectors that saw notable increases included shipbuilding, industrial gases, photolithography machines, banking, and superconducting concepts [1] - Conversely, digital currency stocks experienced significant declines, along with substantial adjustments in sectors like electronic identification, cross-border payments, and Web3 concepts [1] Institutional Insights - According to institutional views, the market is expected to experience fluctuations, with a historical 60% probability of the Shanghai Composite Index rising in July. Investors are advised to focus on defensive sectors in the early part of the month and shift attention to mid-year performance reports and policy movements later on. Key sectors to watch include technology (semiconductors, AI), military industry, and high-growth areas in mid-year reports [2] - Another institution emphasized the importance of focusing on performance-driven sectors and stable assets as the earnings season approaches, with expected growth in industries such as steel, computers, and defense [2] Policy Developments - The National Healthcare Security Administration announced that a draft for the commercial insurance innovative drug directory and the medical insurance directory will be released soon. This initiative aims to streamline the application process for companies and ensure that both directories are aligned in their adjustments [4] - The State-owned Assets Supervision and Administration Commission is accelerating the development of the new energy vehicle industry, focusing on enhancing the capabilities of young talents in intelligent development and digital marketing [5]