Group 1 - The geopolitical tensions in Iran have led to significant fluctuations in oil prices, with Brent and WTI crude oil futures rising by 1.9% and 0.7% respectively as of January 16, 2026 [2] - OPEC+ has increased production by 2.21 million barrels per day in 2025, but plans to slow down production increases in 2026 to balance oil prices [3] - The International Energy Agency (IEA) has revised its forecast for global oil demand growth in 2026 to 860,000 barrels per day, driven primarily by the chemical sector [4] Group 2 - The "Big Three" Chinese oil companies have demonstrated resilience during the recent oil price fluctuations, with performance exceeding historical levels due to increased production and effective cost control [5] - The ongoing capital expenditure by the "Big Three" is expected to support their long-term growth and adaptation to changing market conditions [5]

Core Viewpoint - The economic data for Q4 2025 indicates a significant "high first, low later" trend, with supply outpacing demand and external demand stronger than internal demand [4][5]. Economic Data Summary - In Q4 2025, the GDP grew by 4.5% year-on-year, aligning with market expectations, while the annual growth rate for 2025 was 5% [4][5]. - The industrial added value for December 2025 increased by 5.2% year-on-year, up from 4.8% in November [4][5]. - Fixed asset investment for the entire year of 2025 saw a cumulative year-on-year decline of 3.8%, worsening from a previous decline of 2.6% [4][6]. - Retail sales of consumer goods in December 2025 grew by 0.9% year-on-year, down from 1.3% in November, marking a continuous decline over seven months [4][6]. Investment Market Insights - In the bond market, from August 2025 to the present, government bond yields have shown a clear divergence, with short-term yields stable and declining, while long-term yields, especially the 30-year yield, are on an upward trend [7]. - The current loose liquidity and diverging fundamentals suggest a gradually optimistic outlook for the bond market, with the 10-year government bond yield expected to stabilize around 1.75% in 2026 [7]. - In the convertible bond market, as of January 16, 2026, the China Securities Convertible Bond Index has risen by 5.6%, mirroring the 5.5% increase in the overall index, indicating a strong demand for convertible bonds amid a bullish equity market [7].

Market Overview - The SW public utility sector increased by 0.06% this week, ranking 13th among 31 SW primary sectors. Sub-sectors showed mixed performance: thermal power up by 0.35%, hydropower down by 1.76%, photovoltaic power up by 4.14%, wind power up by 0.22%, comprehensive energy services up by 4.49%, and gas down by 1.17% [4] Price Trends - Domestic and imported thermal coal prices exhibited divergent trends. Domestic Qinhuangdao port 5500 kcal thermal coal price rose by 3 CNY/ton week-on-week, surpassing 700 CNY/ton. In contrast, imported thermal coal in Guangzhou decreased by 20 CNY/ton week-on-week [5] - The average electricity prices in Guangdong and Shanxi increased year-on-year. Monthly agency purchasing costs are on the rise due to higher capacity prices and the entry of new energy mechanisms into the settlement cycle. However, agency purchasing electricity costs have generally decreased nationwide, with only five regions experiencing year-on-year increases [5] Key Events 1. The National Energy Administration released data indicating a 5.0% year-on-year increase in total electricity consumption by 2025, with specific increases in various sectors: primary industry up by 9.9%, secondary industry up by 3.7%, tertiary industry up by 8.2%, and urban-rural residential electricity consumption up by 6.3% [6] 2. The State Grid Gansu Electric Power Company announced that by 2025, the capacity demand for the Gansu power grid will be 28.89 million kW, with a reliable capacity of 32.27 million kW, resulting in a capacity supply-demand ratio of 89.53% [6] 3. The State Grid announced a fixed asset investment plan of 4 trillion CNY during the "14th Five-Year Plan" period, representing a 40% increase compared to the previous plan, aimed at building a new power system [6] Industry Insights - The State Grid's investment plan emphasizes the importance of digitalization in the new power system. With the decline in thermal coal prices, national thermal power operators are expected to see significant year-on-year increases in profitability per kilowatt-hour [8] - The electricity price remains a critical factor, with market focus on electricity prices and stable supply-demand regions. The green electricity sector is entering the settlement phase under the "136 Document," which may lead to adjustments in new green electricity installations [8] - The overall electricity supply-demand situation is expected to remain loose, continuing the trend from 2025, with pressure on electricity prices. However, the growth in green electricity installations may support the demand for base-load thermal power [8]

Market Overview - The A-share pharmaceutical and biotechnology index fell by 0.68%, underperforming the CSI 300 index by 0.11 percentage points and the ChiNext index by 1.97 percentage points, ranking 19th among 31 sub-industries [4] - The Hong Kong Hang Seng Healthcare Index rose by 2.38%, outperforming the Hang Seng China Enterprises Index by 0.48 percentage points [4] R&D Progress - Last week, Qinhai Pharmaceutical's GH55 and Innovent Biologics' IBI343 clinical applications were newly undertaken [5] - Sangfor's 608 is currently in Phase III clinical trials; Aosaikang's ASK092 is in Phase II; and Hansoh Pharmaceutical's HS-20093 is in Phase I clinical trials [5] Industry Insights - The pharmaceutical and biotechnology sector is driven by innovation (including overseas expansion, AI, and new technologies), performance validation, policy benefits, and seasonal market movements, with a focus on innovative drugs and CXO in the short term [6] - AI in healthcare and pharmaceuticals, brain-computer interfaces, and small nucleic acid drugs are identified as high-potential sub-themes [6] - Continuous attention is required on the outcomes of collaborations post-JPM conference, clinical data of innovative drugs, and performance realization [6] Investment Strategy for 2026 - The investment focus in the pharmaceutical sector should increasingly emphasize the clinical value logic, addressing clinical needs of patients and doctors, influenced by domestic medical insurance policies and global expansion [7] - The clinical value is expected to command higher premiums, leading to a favorable outlook on the innovative drug supply chain and innovative medical devices [7]

Market Performance Overview - The Hong Kong stock market experienced an overall increase, while the domestic equity market showed mixed fluctuations, with the CSI 500 index rising by 2.18% during the week from January 12 to January 16, 2025 [4] - Among the Shenwan first-level industry indices, the computer, electronics, and non-ferrous metals sectors had the highest gains, while the defense, real estate, and agriculture sectors faced the largest declines [4] Fund Product Issuance - A total of 23 new funds were established in the domestic market this week, with a combined issuance of 19.294 billion units. This included 10 equity funds, 3 bond funds, 7 mixed funds, 1 international (QDII) fund, and 2 FOF funds [5] - Overall, 36 new funds were issued across the market, comprising 17 equity funds, 12 mixed funds, 4 bond funds, and 3 FOF funds [5] Fund Product Performance Tracking - The TMT thematic funds showed strong performance this week, while the defense and military industry thematic funds experienced a net value decline. As of January 16, 2026, the net value changes for various thematic funds were as follows: TMT (3.98%), cyclical (2.08%), industry balanced (1.56%), industry rotation (1.30%), new energy (0.81%), consumption (-0.76%), pharmaceuticals (-1.08%), financial real estate (-1.45%), and defense military (-2.71%) [6] ETF Market Tracking - There was a noticeable profit-taking phenomenon in the stock ETF market, with over 130 billion yuan flowing out of various broad-based ETFs. In contrast, thematic ETFs, particularly TMT and cyclical ETFs, attracted significant inflows, totaling over 60 billion yuan [7] - The median return for stock ETFs this week was 0.55%, with a net outflow of 142.72 billion yuan. The median return for Hong Kong stock ETFs was 2.08%, with a net inflow of 10.824 billion yuan [7] - Commodity ETFs had a median return of 2.86%, with a net inflow of 2.988 billion yuan [8] ESG Financial Products Tracking - This week, 21 new green bonds were issued, with a total issuance scale of 11.811 billion yuan. The domestic green bond market has steadily developed, with a cumulative issuance scale of 5.21 trillion yuan and a total of 4,502 bonds issued as of January 16, 2026 [9] - The domestic market currently has 211 ESG funds, with a total scale of 159.744 billion yuan. The median net value changes for various ESG fund types this week were: active equity (1.56%), passive equity index (0.32%), and bond ESG funds (0.06%). Funds focused on clean energy, green initiatives, and low-carbon economy themes performed particularly well [9]

Core Viewpoint - The article emphasizes the ongoing integration of artificial intelligence (AI) in various industries, particularly in manufacturing and pharmaceuticals, driven by government policies and technological advancements [4][5][6]. Group 1: AI Integration in Manufacturing - The Chinese government has issued policies to promote the integration of AI in manufacturing, focusing on quality improvement and efficiency through technologies like large models and digital twins [4]. - Key players in the chemical industry, such as China National Petroleum, China Petroleum & Chemical, and China National Offshore Oil Corporation, are developing industry-specific AI models to enhance core business operations [5]. - Companies like Wanhua Chemical are leveraging third-party AI platforms to achieve cost reduction and efficiency in production management and material research [5]. Group 2: Growth of Small Nucleic Acid Drugs - The global market for small nucleic acid drugs has seen significant growth, with a compound annual growth rate (CAGR) of 217.8%, increasing from $0.1 billion in 2016 to $3.25 billion in 2021 [6]. - Projections indicate that the market for oligonucleotide drugs will exceed $15 billion by 2026, with a CAGR of 35% from 2020 to 2025 [6]. - The industry is expected to transition from technological breakthroughs to large-scale commercialization, indicating a promising future for the small nucleic acid drug sector [6]. Group 3: Key Players in Small Nucleic Acid Development - Bluestar Technology has established a comprehensive technology platform for small nucleic acids and peptide drugs, being one of only two global suppliers capable of providing integrated solutions for complex oligonucleotide synthesis [7]. - Lonza Technology is expanding its CDMO services globally, achieving significant progress in partnerships with leading pharmaceutical companies and enhancing its domestic collaborations [7].

Core Viewpoint - The article emphasizes that the copper market is expected to remain tight in 2026, supporting a potential increase in copper prices despite current pressures on demand [4]. Supply and Demand - As of January 16, 2026, SHFE copper closed at 100,770 CNY/ton, down 0.63% from January 9, while LME copper closed at 12,803 USD/ton, down 1.50% [4]. - The TC spot price has reached a historical low, indicating tight procurement conditions for copper concentrate [4][6]. - Domestic copper social inventory increased by 17.2% week-on-week, while LME copper inventory rose by 4.6% [5]. Inventory Levels - Domestic mainstream port copper concentrate inventory stood at 690,000 tons, up 7.8% week-on-week as of January 16, 2026 [5]. - Global electrolytic copper inventory totaled 900,000 tons, reflecting a week-on-week increase of 7.7% [5]. Supply Factors - In October 2025, China's copper concentrate production was 130,000 tons, down 8.1% month-on-month and 12.1% year-on-year [6]. - The price difference between refined copper and scrap copper was 3,391 CNY/ton, down 1,010 CNY/ton from January 9 [6]. Smelting and Processing - The TC spot price was recorded at -46.6 USD/ton, marking a historical low [7]. - In December 2025, China's electrolytic copper production was 1,178,100 tons, up 6.8% month-on-month and 7.5% year-on-year [7]. Demand Insights - Cable manufacturing, which accounts for approximately 31% of domestic copper demand, saw a weekly operating rate of 55.99%, down 0.59 percentage points [8]. - Air conditioning production, representing about 13% of domestic copper demand, is projected to decline by 11.4% and 2.4% in the first quarter of 2026 [8]. Futures Market - As of January 16, 2026, the SHFE copper active contract open interest increased by 24% week-on-week, reaching 226,000 lots [9]. - COMEX non-commercial net long positions were recorded at 53,000 lots, down 7.6% week-on-week [9].

Core Viewpoint - The company plans to acquire 51% of the equity of Tangyuan County Hairuite Engineering Plastic Co., Ltd. for cash, which will make Hairuite a subsidiary of the company after the acquisition is completed [4]. Group 1: Acquisition Details - The total assessed value of 100% equity of Hairuite is 25.3288 million yuan, with the final transaction price set at 25.26 million yuan. The company will use its own funds to acquire 51% of Hairuite's equity for a transfer price of 12.8826 million yuan [5]. - Hairuite specializes in the synthesis and modification of polyether ether ketone (PEEK) and polyarylether ketone (PAEK) resins, with an annual production capacity of over 200 tons of high-quality PEEK and low-melting point PAEK resins [5]. Group 2: Financial Performance - Hairuite's revenue and net profit for 2024 and the first eight months of 2025 are projected to be 4.78 million yuan and -1.08 million yuan, and 7.58 million yuan and -0.519 million yuan, respectively [5]. Group 3: Industry Insights - PEEK is a high-performance material with excellent physical and chemical properties, widely used in various industries such as aerospace, automotive, electronics, energy, and medical devices. Its melting point is 343°C, and it maintains high wear resistance and low friction coefficients at 250°C [6]. - The comprehensive performance of PEEK, including heat resistance, wear resistance, fatigue resistance, and chemical resistance, positions it well for continued growth in high-end manufacturing, indicating significant future development potential [6].

Group 1 - The core viewpoint of the article indicates that the U.S. Treasury yield curve is expected to continue its "steepening" trend, with short-term yields declining due to interest rate cuts, while long-term yields remain volatile due to economic outlook and fiscal sustainability concerns [4] - By January 9, 2026, the iBoxx China USD bond index yield reached 4.82%, highlighting the existing premium between offshore and onshore markets, and suggesting that high coupon opportunities are worth attention [4] Group 2 - The supply side shows a slight decrease in the maturity scale of China USD bonds in 2026 compared to 2025, with a "borrow new to repay old" logic potentially leading to a contraction in supply [5] - Regulatory tightening on local government financing vehicles (LGFVs) and the gradual implementation of domestic debt replacement with foreign debt are expected to limit the growth of supply in this sector [5] Group 3 - On the demand side, there is a strong ongoing demand for high-yield assets due to insufficient supply, and the expansion of the "southbound trading" is expected to attract incremental funds, leading to a steady increase in demand for China USD bonds in 2026 [6] - However, the appreciation expectation of the Renminbi may increase the foreign exchange risk for investors, potentially raising their hedging costs [6] Group 4 - In the context of ongoing "debt reduction" policies, the default risk for local government financing vehicles is relatively low, and their USD bonds are less affected by international factors, making them a stable investment option [8] - For industrial bonds, those from state-owned enterprises and the TMT sector are considered valuable for allocation, while local state-owned enterprises and policy-driven industries may see moderate downshifting [8] - Financial USD bonds from joint-stock banks and bank-affiliated financial companies are recommended for their good liquidity and potential yield exploration [8] - The credit risk in the real estate USD bond sector remains high, necessitating caution following market sentiment shifts after events like Vanke's extension [8]

Group 1: Fixed Income - The U.S. Treasury yield curve is expected to exhibit a "steepening" characteristic in 2026, with short-term yields declining due to anticipated interest rate cuts, while long-term yields remain volatile due to economic outlook and fiscal sustainability concerns [5] Group 2: Real Estate - Recent publications in "Qiushi" focus on real estate and urban renewal, improving and stabilizing market expectations; the central bank has lowered various structural monetary policy tool rates by 0.25 percentage points, which supports local state-owned enterprises in acquiring existing residential properties for affordable housing [6] Group 3: Non-Ferrous Metals - Global copper inventories at major exchanges have reached the highest level since July 2013; the market has priced in the Federal Reserve's decision not to cut rates in January 2026, with tight procurement of copper concentrate reflected in low TC spot prices [7] Group 4: Oil and Chemical - China National Offshore Oil Corporation (CNOOC) held a work meeting to review its "14th Five-Year Plan" and set priorities for 2026, aiming to build a world-class energy group with distinct marine characteristics [9] Group 5: Basic Chemicals - The implementation of "AI+" in chemical research and manufacturing is expected to drive rapid growth in small nucleic acid drugs in 2026, supported by government initiatives promoting the integration of AI and manufacturing [10] Group 6: New Energy and Environmental Protection - The State Grid's fixed asset investment is projected to reach 4 trillion yuan during the "14th Five-Year Plan," a 40% increase from the previous period, with an expected annual compound growth rate of 7%, indicating a focus on counter-cyclical adjustments [10]