Group 1: Economic Outlook - July global PMI fell short of expectations, indicating limited export growth in the second half of the year[1] - Manufacturing sector remains weak due to production restrictions, with economic growth in the first half providing a stable foundation[1] - The next round of growth stabilization measures is expected in Q4, with no need for premature tightening of monetary policy[1] Group 2: Market Dynamics - The "seesaw" effect between stock and bond markets continues, with funds being diverted from the bond market as equity markets gain momentum[1] - Major commodity exchanges issued risk warnings, leading to a broad decline in commodity futures, which may help stabilize interest rates[1] - The Shanghai Composite Index briefly surpassed 3600 points, reflecting a positive market sentiment[1] Group 3: Key Developments - The third batch of 690 billion yuan in special government bonds has been allocated to support consumption upgrades[8] - The issuance of replacement bonds has reached 90% of the annual quota, with 1.8 trillion yuan issued by the end of June[8] - The insurance industry has lowered the maximum guaranteed interest rate for new products to 2.0%[9] Group 4: International Context - The U.S. and EU reached a 15% tariff agreement, with the EU committing to invest an additional $600 billion in the U.S.[12] - The EU has paused interest rate cuts after eight consecutive reductions, citing "exceptional uncertainty" in the current environment[12] - India's trade agreement with the UK will eliminate tariffs on 99% of Indian exports to the UK[12]

1. Report Industry Investment Rating No relevant content provided. 2. Core Viewpoints of the Report - The policy support for science - innovation bonds has led to significant growth in issuance and trading activity. The bonds have unique characteristics compared to overall credit bonds, and specific types of science - innovation bonds show investment value [2]. - It is recommended to focus on inter - bank science - innovation bonds (medium - term notes and general short - term financing) and target bonds excluding science - innovation bond ETF index component bonds [2]. 3. Summary by Directory 3.1 Policy Support for Science - Innovation Bonds - **Issuance and Listing Review Rules**: In December 27, 2024, the Shanghai, Shenzhen, and Beijing stock exchanges issued rules for the issuance and listing review of special - variety corporate bonds, including science - innovation bonds. Four types of issuers (science - innovation enterprises, science - innovation upgrade, science - innovation investment, and science - innovation incubation) can issue such bonds under certain conditions, with specific requirements for the proportion of funds invested in the science - innovation field and supporting mechanisms [7]. - **Support for Issuance and Construction of a Multi - tiered Bond Market**: On May 7, 2025, the People's Bank of China and the China Securities Regulatory Commission jointly issued an announcement to support the issuance of science - innovation bonds, aiming to enrich the product system, build a multi - tiered bond market, and improve supporting mechanisms. The issuance subject scope was expanded to financial institutions, technology - based enterprises, private equity investment institutions, and venture capital institutions [10]. 3.2 Overview of Outstanding Science - Innovation Bonds - **Distribution of Different Bond Types**: Medium - term notes and corporate bonds are the core issuance types of science - innovation bonds. Exchange - issued science - innovation bonds are more active than those issued in the inter - bank market. In terms of issuance quantity and bond balance, exchange - issued bonds account for 57.93% and 66.28% respectively, while inter - bank issued bonds account for 42.07% and 33.72% [14]. - **Remaining Maturity Characteristics**: The remaining maturity of outstanding science - innovation bonds is mainly short - to medium - term, concentrated below 5 years. In terms of bond quantity, those with a remaining maturity below 5 years account for 89.44%, and in terms of bond balance, they account for 88.80% [16]. - **Comparison of Basic Elements with Overall Credit Bonds**: Outstanding science - innovation bonds are concentrated in high - credit - rated bonds. The proportion of AAA - rated bonds is 77.45%, 30.68% higher than that of overall credit bonds. They have a longer issuance term and a lower coupon rate compared to overall credit bonds [17][19]. 3.3 Overview of the Primary Market for Science - Innovation Bonds - **Issuance Volume**: With strong policy support, the issuance volume of science - innovation bonds has increased significantly. In May 2025, the issuance volume increased by 120.51% year - on - year, and from May to July 18, 2025, the issuance volume reached 7668.48 billion yuan, accounting for 22.32% of the total issuance volume [25]. - **Rating Distribution**: Science - innovation bonds are concentrated in the AAA high - credit - rating category. The issuance volume and quantity of AAA - rated bonds account for 84.55% and 71.38% respectively, indicating high overall credit quality [29]. - **Industry Distribution**: Compared to overall credit bonds, the industry distribution of science - innovation bonds is more balanced. Although the issuance scale in the banking, non - banking, comprehensive, and building decoration industries is high, the issuance scale in industries such as coal, steel, and electronics is significantly higher than that of overall credit bonds. Science - innovation bonds have certain interest - rate advantages in most industries, with the lowest rate in the national defense and military industry at 0.89% [30][35]. - **Regional Distribution**: Science - innovation bonds in economically developed regions have a large issuance scale and a low issuance rate. Beijing has the largest issuance scale, accounting for 27.85% of the total, followed by Shanghai at 9.29% [36]. - **Issuance Industries after the New Policy**: With policy support, the issuance scale of science - innovation bonds in the financial industry has increased significantly. After the new policy, the issuance quantity of science - innovation bonds in the banking and non - banking financial industries accounted for 5.81% and 15.83% respectively [41]. 3.4 Overview of the Secondary Market for Science - Innovation Bonds - **Trading Volume**: After the new policy, the trading activity of science - innovation bonds has increased significantly. In May 2025, the trading volume was 196.097 billion yuan, a 71.01% month - on - month increase. After the issuance subject was expanded to financial institutions, the trading activity of bank - issued science - innovation bonds ranked first [45][49]. - **Monthly Average Volatility**: Before the new policy, the monthly average volatility of science - innovation bonds remained above 2% for six consecutive months, while after the new policy, it was below 2%, indicating a significant reduction [50]. - **Turnover Rate**: The turnover rate of science - innovation bonds has been rising, increasing from 6.25% in April to 9.16% in June 2025, which has improved the liquidity and pricing efficiency of the secondary market [53]. - **Price Fluctuations**: After the new policy, the quantile curves of price fluctuations of science - innovation bonds have converged, and the trading volatility has narrowed [54]. - **Credit Spread Curve**: Among different types of science - innovation bonds, inter - bank medium - term notes and general short - term financing bonds have certain cost - effectiveness. Non - AAA science - innovation bond index component bonds have relative value [59][71]. 3.5 Investment Recommendations - Recommend focusing on inter - bank science - innovation bonds (medium - term notes and general short - term financing) and target bonds excluding science - innovation bond ETF index component bonds [79].

Core Insights - The report emphasizes the strategic allocation of ETFs in various sectors, recommending a focus on liquor, real estate, and white goods for the upcoming week [2] - The model portfolio for the week of July 28, 2025, includes continued holdings in real estate ETFs and the addition of oil and gas ETFs, indicating a shift in market focus [2][5] - The report highlights a cumulative return of approximately 1.40% for the strategy from July 21 to July 25, 2025, with an excess return of -0.32% compared to the CSI 300 ETF [2][5] ETF Strategy Summary - The report outlines specific ETFs and their respective values, with the liquor ETF valued at 32.58 billion, real estate ETF at 6.83 billion, and tourism ETF at 30.84 billion, among others [2] - The report provides a detailed performance tracking of various ETFs, indicating that the average return for the ETFs was 1.40% during the specified period [5] - The report includes a table of ETFs with their current holdings and performance metrics, showing that the real estate ETF has a holding signal of 100% and the liquor ETF has a holding signal of 55.71% [2][5]