Market Overview - The first trading day of the Year of the Horse (February 24) saw A-shares open positively, with the ChiNext index rising by up to 2% and the Shanghai Composite Index closing up 0.87% [1][14] - Over 4,000 stocks in the market rose, with more than 100 stocks hitting the daily limit [1][14] - The total trading volume in the Shanghai, Shenzhen, and Beijing markets reached 2.2 trillion yuan, an increase of 219.3 billion yuan from the previous trading day [1][14] Sector Performance - The chemical sector continued to rise, with active performances in phosphate chemicals and fertilizers, leading to several stocks, including Hebang Biotechnology, hitting the daily limit [1][14] - The Chemical ETF (516020) surged by 3.42%, attracting 222 million yuan in the previous five trading days [1][14] Precious Metals and Commodities - Following the Spring Festival, the domestic market entered a peak working season, with the "golden March and silver April" period expected to see increased industrial production and infrastructure projects [3][16] - Precious metals prices surged due to rising risk aversion stemming from U.S. tariff policy disputes and geopolitical tensions, with the Precious Metals ETF (159876) rising by 3.18% and attracting a net subscription of 6 million units [3][16] - The outlook for gold demand is optimistic, with expectations of surpassing 5,000 tons globally by 2025, driven by strong investment flows and central bank purchases [7][19] Military and Aerospace Sector - The military sector showed strong performance, with the Military ETF (512810) rising by 1.16% and experiencing a premium at closing [9][21] - The domestic aviation sector is expected to accelerate, with the C919 aircraft averaging nearly 50 flights per day during the Spring Festival, a 52.6% increase year-on-year [11][24] - Geopolitical tensions, particularly between the U.S. and Iran, are expected to heighten the urgency of national defense construction in China [11][24] Investment Strategies - Analysts suggest maintaining a focus on cyclical price increases and the expansion of AI trends as the main market themes [4][17] - The investment strategy emphasizes a dual focus on technology and resource products, with technology centered on AI, new energy, and innovative pharmaceuticals, while resource products focus on precious metals and basic chemicals [4][17]

Core Viewpoint - The military industry sector in A-shares shows strong performance on the first trading day of the Year of the Horse, with significant interest in military ETFs, particularly the Huabao ETF, which has seen a price increase and active buying [1][3]. Group 1: Market Performance - The military sector experienced a quick recovery after a brief dip, with the Huabao ETF reaching a high of 1.98% and closing up 1.16%, marking three consecutive days of gains [1]. - Among the constituent stocks, 57 increased while 23 decreased, with notable gains from Zhonghang Heavy Machinery and Feiliwa, both rising over 8%, and China Power increasing by 6.17% [1]. - Major stocks such as China Shipbuilding, Aero Engine Corporation of China, and Guangqi Technology all rose by over 2% [1]. Group 2: Industry Catalysts - The military industry is experiencing multiple catalysts, including a significant increase in domestic flight operations of the C919 aircraft, which averaged nearly 50 flights per day during the Spring Festival, representing a year-on-year growth of 52.6% [3]. - The commercial aerospace sector is expected to see intensive testing of recoverable rocket experiments from March to June [3]. - Internationally, heightened tensions between the U.S. and Iran have led to increased urgency in China's defense construction, as evidenced by the U.S. Navy's approval of Raytheon Technologies' smart weapon for use on the Super Hornet fleet [3]. Group 3: Investment Recommendations - Dongfang Securities recommends increasing allocation to the military sector, particularly focusing on large aircraft and military trade, anticipating accelerated progress in large aircraft production and increased market share in military trade in new markets like the Middle East [3]. - The Huabao ETF, which covers various popular themes such as large aircraft, commercial aerospace, low-altitude economy, satellite navigation, military informationization, and controllable nuclear fusion, is highlighted as an efficient tool for investing in core military assets [3].