Core Viewpoint - The A-share market is experiencing a significant rally, with the Shanghai Composite Index breaking the 4000-point mark, indicating a potential long-term bullish trend driven by technological advancements and supportive policies [1][7]. Market Performance - On October 29, the A-share market saw fluctuations around the 4000-point level, with over 3200 stocks declining and a half-day trading volume of 1.42 trillion, an increase of 71.9 billion from the previous trading day. By midday, the Shanghai Composite Index rose by 0.37%, the Shenzhen Component by 0.90%, and the ChiNext Index by 1.35% [1]. Sector Highlights - **Quantum Technology**: The quantum technology sector is gaining momentum, with stocks like Shenzhou Information hitting the daily limit. The global quantum technology market is projected to exceed $6.1 billion by 2025, with China's market expected to reach 11.56 billion yuan, reflecting a compound annual growth rate of over 30% [3]. - **Hainan Free Trade Zone**: Stocks related to the Hainan Free Trade Zone are rising, with companies like Hainan Development and Haide Shares reaching their daily limit. The Hainan Free Trade Port is set to officially launch on December 18, 2023, as the region accelerates the implementation of free trade policies [4]. Institutional Perspectives - **Pacific Securities**: The breakthrough of the 4000-point mark after ten years provides a solid foundation for future A-share highs. Any pullback in the index is seen as a buying opportunity, particularly in stable sectors like the Shanghai 50 [5]. - **Industrial Trends**: The focus should be on sectors benefiting from the "14th Five-Year Plan," with an emphasis on technology, AI, military, and innovative pharmaceuticals as key growth areas [6]. - **Oriental Securities**: The current market conditions, including a favorable policy environment and the ongoing economic transformation, suggest that the 4000-point level does not signify the end of the rally, but rather the beginning of a "technology bull" market [7].

Market Overview - The A-share market experienced wide fluctuations, with a significant rebound in the indices on Wednesday, leading to a total trading volume exceeding 2.3 trillion yuan [3][10] - The semiconductor industry chain saw a comprehensive rally, while the new energy sector also became active, indicating a concentration of funds towards technology [3][10] Key Variables for Market Continuation - The sustainability of the market rebound led by semiconductors depends on several key variables: 1. Continuous expansion of trading volume is crucial, with Tuesday's trading volume nearing 2.5 trillion yuan but slightly shrinking on Wednesday [3][11] 2. The performance of leading stocks, particularly a state-owned enterprise in the semiconductor sector, significantly influences market sentiment [3][11] 3. The implementation of supportive policies for the semiconductor industry will directly affect the pace of domestic substitution and the overall industry fundamentals [3][11] Sector Analysis Semiconductor Sector - The semiconductor sector has shown strong performance, with a year-on-year increase of 10.10% in 2023 despite a weak overall market [7] - National policies are supportive, with the establishment of the third phase of the National Integrated Circuit Industry Investment Fund, which promotes upgrades across the semiconductor industry chain [7] - The global semiconductor market is expected to grow by over 15% in 2025, driven by rising demand for AI and high-performance computing [7] New Energy Sector - Stocks in the new energy sector, including energy metals and photovoltaic equipment, have seen significant gains, supported by recent government initiatives aimed at optimizing industry layout and promoting quality management [8][9] - The new energy sector is expected to continue benefiting from the global push towards carbon neutrality, with ongoing demand for lithium batteries, photovoltaics, and energy storage [9] Real Estate Sector - The real estate sector has rebounded, aided by new policies in major cities that enhance market conditions for homebuyers [10] - The industry is transitioning from individual case breakthroughs to a model of replication, which is expected to facilitate risk clearance and a healthy cycle within the sector [10] Investment Strategy - The report suggests a strategic approach to investing, focusing on high-quality companies with clear industry prospects while reducing exposure to overvalued sectors [12] - Maintaining flexible capital reserves is recommended to adapt to market changes effectively [12]