Group 1: Market Trends - Extreme short positions in the dollar suggest a potential short squeeze in the future, with speculative net short positions rising to 13,000 contracts, accounting for 33.5% of total positions, the highest since February 2021[4] - Japan's core CPI, excluding food and energy, has remained at 1.6% year-on-year for six consecutive months, indicating a cooling inflation pressure that may limit the Bank of Japan's rate hike space[7] - The 10-year Japanese government bond yield may trend down towards 1% as inflation levels continue to decline, flattening the yield curve[11] Group 2: Central Bank Actions - The Bank of Japan plans to gradually sell its ETF and real estate trust holdings, with an annual target of 330 billion yen for ETFs and 5 billion yen for real estate trusts, suggesting a selling timeline of over 100 years at the current pace[9] - The current equity risk premium (ERP) for the CSI 300 index is 4.5%, which is one standard deviation below the 16-year average, indicating potential for valuation uplift[17] Group 3: Economic Indicators - Since the beginning of the year, the U.S. labor supply has increasingly favored domestically born individuals, with 139 million domestic-born workers compared to 32.24 million foreign-born workers[15] - The forward arbitrage return on China's 10-year government bonds is currently at 23 basis points, which is 53 basis points higher than the level in December 2016[20] - The total return ratio of domestic stocks to bonds is 27.8, above the 16-year average, suggesting enhanced attractiveness of equity assets relative to fixed income[27]

1. Report Industry Investment Rating No information regarding the industry investment rating is provided in the report. 2. Core Viewpoints of the Report The report comprehensively analyzes various policies from September 5th to September 20th, 2025, including macro - economic, fiscal, monetary, financial regulatory, real estate, and tariff policies. It aims to provide an overview of the current economic policy environment and potential impacts on different sectors [1][2][3]. 3. Summary by Directory 3.1 Macro - economic Tone - The government is promoting the construction of a unified national market and expanding service consumption. Measures include rectifying disorderly competition, boosting consumer spending with about 420 billion yuan in fiscal support driving over 2.9 trillion yuan in sales, and promoting private investment [1][11][12] - The State Council has deployed measures to promote private investment, aiming to expand investment space, ensure fair competition, and support private capital in new areas [13][16] 3.2 Fiscal Policy - The fiscal policy is more active, with a focus on using special bonds to repay government arrears to enterprises. As of September 19th, 2025, 1.1506 trillion yuan of special bonds have been issued, exceeding the annual limit of 800 billion yuan [17] - Over 60% of financing platforms have exited, and 4 trillion yuan of the 6 - trillion - yuan special debt quota has been issued. The government debt risk is under control, and it plans to issue part of the 2026 local government debt quota in advance [18][19] 3.3 Monetary Policy - The central bank has optimized and simplified the evaluation indicators for primary dealers, which helps to improve the transmission of interest rates and strengthen the benchmark nature of the Treasury yield curve [21] - The 14 - day reverse repurchase operation has been adjusted to a fixed - quantity, interest - rate tender, and multiple - price winning bid method, further strengthening the policy interest rate status of the 7 - day reverse repurchase [22] - The global financial stability system faces challenges such as fragmented regulatory frameworks, insufficient regulation in digital finance, and weak regulation of non - bank intermediaries [23] 3.4 Financial Supervision - A draft for public comments on the management regulations of public fund sales fees has been released, and the second batch of science and technology innovation bond ETFs will be listed on September 24th [26] - New regulations for insurance, trust, and securities industries have been introduced, including the "Insurance Company Capital Guarantee Management Measures", the "Trust Company Management Measures", and the start of the self - evaluation of securities company classification [27][28] - The controlling rights of three AMC companies have been transferred to Central Huijin. There are concerns about the liquidity risk of funds concentrated in the technology sector, and the proportion of cash wealth management in August reached a new low for the year [29] 3.5 Real Estate Policy - Shenzhen has relaxed purchase restrictions in multiple districts, and Shanghai has exempted first - home buyers from property tax under certain conditions [32] - Shenzhen has released a draft for public comments on the housing provident fund management measures, and Beijing and Shanghai have adjusted the upper and lower limits of the monthly housing provident fund payment base [33] 3.6 Tariff Policy - Chinese and US leaders had a phone call, and the two sides reached a basic framework on issues such as TikTok. China opposes the politicization of technology and economic and trade issues [36][37]

Investment Rating - The report maintains a "Buy" recommendation for the computer industry [3] Core Insights - The report details the development and technological advancements of the Grok series, particularly Grok-4, and analyzes the commercial progress of major domestic and international AI model manufacturers, highlighting the transformative impact of large models on the AI industry [7][8] Industry Overview - The computer industry consists of 337 listed companies with a total market capitalization of approximately 494.5 billion yuan, representing 4.53% of the overall market [3] - The circulating market value stands at around 428.3 billion yuan, accounting for 4.98% [3] Performance Metrics - Absolute performance over 1 month, 6 months, and 12 months is 6.7%, 17.4%, and 71.5% respectively, while relative performance is 1.3%, 9.1%, and 50.2% [4] Grok Series Development - The Grok series, developed by xAI, has undergone rapid iterations, with Grok-1 to Grok-4 showcasing significant advancements in model capabilities, including multi-modal functionalities and enhanced reasoning abilities [11][13][29] - Grok-4, released in July 2025, features a context window of 256,000 tokens and demonstrates superior performance in academic-level tests, achieving a 44.4% accuracy rate in the Human-Level Examination [30][29] Competitive Landscape - The report highlights the competitive dynamics in the AI model market, noting that the landscape has shifted from a single-dominant player (OpenAI) to a multi-polar competition involving several key players, including xAI, Anthropic, and Google [8][55] - Domestic models are making significant strides in performance and cost efficiency, with models like Kimi K2 and DeepSeek R1 showing competitive capabilities against international counterparts [8][55] Investment Recommendations - The report suggests focusing on AI application sectors, including enterprise services, financial technology, education, healthcare, and security, with specific companies identified for potential investment [8]

Investment Rating - The report maintains a "Recommendation" rating for the computer industry, expecting the industry index to rise more than 5% over the next 3-6 months compared to the benchmark index [17]. Core Views - The industry is currently in a phase of wide fluctuations, with a focus on leading companies and the importance of AI+, quantum information, and domestic application opportunities. The report highlights that as model capabilities continue to improve, the AI+ application industry will accelerate its implementation. Additionally, the quantum computing sector is rapidly developing globally, with significant collaborations such as the "Technology Prosperity Agreement" between the UK and the US, which involves over £31 billion in investments from major tech companies [1][2]. Summary by Sections Industry Overview - The computer industry consists of 337 listed companies with a total market capitalization of ¥59,816.49 billion and a circulating market capitalization of ¥53,773.16 billion [4]. Performance Metrics - The absolute performance of the industry over the past month, six months, and twelve months is 3.4%, 12.0%, and 103.4%, respectively. The relative performance shows a decline of 3.2% over one month but an increase of 62.5% over twelve months compared to the benchmark [5]. Key Developments - The establishment of the Quantum Computing Alliance and the upcoming "AI Quantum: Quantum Intelligence" forum in Shanghai are significant developments in the quantum computing sector. The report notes that various applications of quantum computing are being explored across multiple industries, including healthcare, defense, and finance [1][7]. Investment Recommendations - The report suggests focusing on several categories for investment: 1. Domestic computing power companies such as Cambricon, Haiguang Information, Alibaba, Baidu, and Inspur [7]. 2. Domestic application companies like Dameng Data and China Software [7]. 3. AI+ companies including Kingsoft Office and iFLYTEK [7]. 4. Quantum information companies such as Guodun Quantum and Shenzhou Information [7].

Group 1: Liquidity and Fund Flow - Leverage funds and newly issued public funds remain at high levels, with net inflow of leverage funds and new issuance of equity public funds continuing to be robust[10] - Southbound funds have seen a net inflow exceeding 460 billion over the past four months, averaging over 10 billion per week[10] - The total net inflow of leverage funds reached approximately 467 billion, while the total net inflow of equity public funds was 127 billion, maintaining a high percentile ranking of 88% and 95% respectively[11] Group 2: Trading Activity and Market Sentiment - Trading heat in the new energy vehicle sector increased by 16 percentage points to 57%, while the real estate sector rose by 7 percentage points to 77%[4] - The brokerage sector saw a decline of 20 percentage points to 42%, and the military industry dropped by 17 percentage points to 33%[4] - Retail investor net inflow in the A-share market reached 186.82 billion, marking a significant increase of 693.7 billion from the previous value, placing it in the 92.5 percentile over the past five years[4] Group 3: Market Trends and Investor Behavior - The Shanghai Composite Index rose from 2600 to 3400 primarily due to state-owned funds and retail investor inflows, with a notable increase in new fund issuance in recent months[5] - The recent week saw a significant increase in search interest for A-shares on Douyin, reaching a new high since April[4] - The overall sentiment in the ETF market improved, with a net inflow of 80.8 billion, reversing the previous outflow of 41.5 billion[25]

Investment Rating - The report maintains a "Recommended" rating for the company, with a target price of 29.1 CNY, compared to the current price of 25.22 CNY [4][8]. Core Views - The company is facing revenue pressure but is focusing on cost reduction and efficiency improvements. In the first half of 2025, the company reported revenue of 11.72 billion CNY (down 0.3% year-on-year) and a net profit attributable to shareholders of 880 million CNY (up 10.3% year-on-year) [2][4]. - The revenue decline is attributed to the company's strategic decision to close low-efficiency stores and slow down the expansion of new stores, focusing instead on improving the quality of existing stores [2][4]. - The company has shown resilience in its operations despite industry pressures, with a projected net profit growth of 15% annually from 2025 to 2027 [2][4]. Financial Summary - Key financial indicators for the company are as follows: - Total revenue for 2024 is projected at 24.06 billion CNY, with a year-on-year growth rate of 6.5% - Net profit attributable to shareholders for 2024 is projected at 1.53 billion CNY, with a year-on-year growth rate of 8.3% - Earnings per share (EPS) for 2024 is expected to be 1.26 CNY, with a price-to-earnings (P/E) ratio of 20 [2][9]. - The company has a total market capitalization of 30.58 billion CNY and a debt-to-equity ratio of 54.84% [5][9]. Operational Insights - As of June 2025, the company operates a total of 14,701 stores, with 10,681 being directly operated (down 5.6% year-on-year) and 4,020 being franchise stores (up 17.3% year-on-year) [2][8]. - The company's retail business generated revenue of 10.20 billion CNY in the first half of 2025, with a gross margin of 42.0% [2][8]. - The company is also focusing on mergers and acquisitions, establishing a dedicated team for auditing and evaluating potential targets [2][8].

Group 1: NEET Overview - The global NEET population is estimated to reach approximately 260 million by 2025, accounting for 20.4% of the global youth population and 3.2% of the total population[3] - The NEET rate varies significantly by gender, with around 87 million male NEETs (13.1% of male youth) and approximately 175 million female NEETs (28.2% of female youth) projected for 2025[3] Group 2: Economic and Cultural Factors - Economic factors contributing to NEET status include slow economic growth and labor market saturation, leading to a deteriorating employment environment[2] - Cultural expectations, particularly regarding gender roles, significantly influence NEET rates, with women often expected to prioritize family responsibilities over career development[2] Group 3: Income Distribution Characteristics - NEET rates decrease with rising income levels; in high-income economies, the NEET rate is about 10.4%, while it rises to 28.5% in low-income economies[4] - The gender distribution among NEETs becomes more balanced in higher-income countries, with female NEETs making up approximately 50% in high-income economies compared to 64% in low-income economies[4] Group 4: Geographic Distribution - The highest NEET rates are found in Arab countries (33%), North Africa (31%), and South Asia (27%), while Western Europe, Southern Europe, Northern Europe, East Asia, and North America have the lowest rates, around 10-11%[5] - Female NEET rates are particularly high in Arab countries (46%), North Africa (44%), and South Asia (43%), contrasting sharply with lower rates in Western and Northern Europe[5] Group 5: NEET Rates in Major Economies - Japan has the lowest NEET rate among major economies at only 3.1%, while other developed economies like the US (11.2%) and Canada (11.7%) hover just above 10%[5] - Countries with unique cultural contexts, such as India (23.6%), Iran (27.2%), and Egypt (26.9%), exhibit significantly higher NEET rates[5]

1. Report Industry Investment Rating No relevant content provided. 2. Core Viewpoints of the Report - The main line remains in the technology sector, with the turnover rate increasing rapidly and the valuation of high - parity convertible bonds being relatively strong. The TMT sector has been continuously catalyzed, and technology may still be the main line during the non - earnings disclosure period. The high - parity convertible bonds are more favored by the market, and the premium rate of 130 - 150 parity convertible bonds increased by 0.24pct last week [6][10]. - Attention should be paid to the calendar effect around the National Day. Due to the long National Day holiday, pre - holiday risk aversion leads to financing net selling and trading slowdown. After the holiday, the index is more likely to recover, and different industries may have different performances. The probability of an increase in margin trading balances in November is 80%. Industries such as communication, electronics, and computers have a relatively high probability of rising after the National Day [2]. 3. Summary According to the Directory 3.1. Positive Stock and Valuation Adjustment, Main Line in the Technology Sector - Last week, the equity market fluctuated and corrected, and the convertible bond market was still in a weak range. The 100 - yuan fitted premium rate decreased by 1.66pct month - on - month. Although the trading volume recovered compared with early September, the convertible bond index's weekly trading volume was 40.9009 billion yuan, a month - on - month increase of 6.42%. The weak performance of micro - cap stocks dragged down the underlying stocks of convertible bonds, and the CSI Convertible Bond Index corrected more significantly [6][9]. 3.2. Pay Attention to the Calendar Effect around the National Day - Pre - holiday capital outflows may be replenished in October. From 2015 - 2024, margin trading balances at the beginning of October mostly decreased compared with those at the beginning of September, and the probability of an increase in margin trading balances in November was 80%. - After the holiday, the index is more likely to recover. From 2015 - 2024, the probability of the Wande All - A Index correcting before the National Day was 60%, and the probability of recovery after the holiday was 70%. Industries with a high probability of rising include communication, electronics, and computers [2]. 3.3. Market Review: Convertible Bonds Corrected Weekly, and Valuation Compressed 3.3.1. Weekly Market Quotes - Last week, major stock indices showed different performances, and the convertible bond market declined. The Shanghai Composite Index decreased by 1.30%, the Shenzhen Component Index increased by 1.14%, the ChiNext Index increased by 2.34%, the SSE 50 Index decreased by 1.98%, the CSI 1000 Index increased by 0.21%, and the CSI Convertible Bond Index decreased by 1.55%. There are 438 issued and unexpired convertible bonds with a balance of 604.505 billion yuan [28]. - In the equity market, most industries were weak. In the convertible bond market, home appliances, communication, and other sectors had the highest increases, while non - bank finance, building decoration, and other sectors had the highest declines [30]. 3.3.2. Valuation Performance - The weighted average closing price of convertible bonds was 129.22 yuan, a decrease of 1.61% from the previous Friday. The closing price of equity - biased convertible bonds increased by 3.72%, while that of debt - biased and balanced convertible bonds decreased. The 100 - yuan parity fitted conversion premium rate decreased by 1.66pct. High - rated and large - scale convertible bonds had a relatively large increase in premium rates, with AAA - rated bonds increasing by 2.44pct and bonds over 5 billion yuan increasing by 2.92pct [36]. 3.4. Terms and Supply 3.4.1. Terms - As of September 19, 4 convertible bonds, including Lushan, Keda, Jiuzhouzhuan 2, and Sanyang Convertible Bonds, announced early redemption; no convertible bonds announced non - early redemption; Jingxing and Fuli Convertible Bonds announced that they were expected to meet the early redemption conditions. - As of September 19, Huitong and Zhengchuan Convertible Bonds proposed downward revisions; Jiayuan Convertible Bond announced the downward revision result; 5 convertible bonds announced no downward revision; Kangyi, Jinggong, and other convertible bonds were expected to trigger downward revisions [3][57]. 3.4.2. Primary Market - Last week, Yingliu Convertible Bond was issued with a scale of 1.5 billion yuan, and there were no convertible bonds to be listed or issued. - Last week, Huaxiang Co., Ltd., Shangluo Electronics, and Huichuangda added board proposals, 4 companies passed the general meeting, 2 companies passed the CSRC review committee, and no new companies were approved by the CSRC. As of September 19, 3 listed companies obtained convertible bond issuance approvals with a proposed issuance scale of 6.802 billion yuan, 7 companies passed the CSRC review committee with a total scale of 6.176 billion yuan, and the total scale of the 3 new board proposals was 2.958 billion yuan [4][60][70].

Investment Strategy - The report emphasizes the strategic importance of Xinjiang in the context of national policies, highlighting its transition from a geographical hinterland to a frontier hub due to the Belt and Road Initiative. This shift positions Xinjiang as a key player in energy security and coal chemical industry development [7][10] - The coal chemical industry in Xinjiang is expected to thrive due to favorable external conditions, including rising coal prices and a focus on resource allocation towards the western regions of China. This aligns with national energy security goals and the need for sustainable development [7][8] - The report identifies two main investment themes: coal chemical investments and state-owned enterprise reforms in Xinjiang, suggesting a focus on companies involved in coal mining and energy conversion [11][12] Xinjiang Index Situation - The Xinjiang index stands at 124.88, reflecting a week-on-week increase of 0.17%. The coal chemical investment index is at 122.8, with a 2.67% increase, while the state-owned enterprise reform index is at 130.07, showing a decrease of 1.15% [14] - The top three gainers for the week include Guangdong Hongda (up 22.93%), Xiyu Tourism (up 17.58%), and Wujin Stainless Steel (up 14.68%). Conversely, the largest declines were seen in Western Gold (down 9.51%), Xinyan Co. (down 13.53%), and Zhongji Health (down 18.32%) [14] Key Data Tracking - Key coal prices in Xinjiang include Q5000 mixed coal at 100 CNY/ton, Q5200 mixed coal at 197 CNY/ton, and main coking coal at 750 CNY/ton. Methanol prices are reported at 1770 CNY/ton, with a price difference of -517.5 CNY/ton compared to East China [22] - In August 2025, coal railway shipments from state-owned key coal mines reached 3.098 million tons, a year-on-year decrease of 6.97%. The total raw coal production in Xinjiang for the same month was 42.2 million tons, down 2.18% year-on-year [22] Key News and Company Announcements - The report notes the commencement of the 2 billion cubic meters per year coal-to-natural gas project by TBEA in the Junjiu Industrial Park, with a total investment of 17 billion CNY. The project aims to utilize advanced international technologies to achieve ultra-low emissions [4][10] - Recent developments in Xinjiang's coal chemical sector include the approval of several projects, such as the 400,000 tons ammonia and 600,000 tons urea project by Xinjiang Yihua Chemical, and the successful trial run of the crude phenol refining project by Xinjiang Qinghua Energy Group [39][40] Overview of Target Companies - The report suggests focusing on companies involved in coal chemical projects in Xinjiang, including TBEA, Baofeng Energy, Guanghui Energy, Hubei Yihua, and Zhongji Health. Additionally, it highlights service providers for coal chemical projects and local state-owned enterprises that may benefit from ongoing reforms [11][12][10]

Investment Rating - The report maintains a "Recommended" rating for the mechanical industry, with a focus on the export of process industrial equipment and humanoid robots [1]. Core Insights - The petrochemical industry is expected to become a major source of global oil demand growth, benefiting from China's mature industrial chain and related equipment. Despite challenges such as energy transition and geopolitical risks, global oil demand is projected to grow by 2.5 million barrels per day from 2024 to 2030, reaching 105.5 million barrels per day [6]. - The humanoid robot sector is highlighted for three key reasons: new technology directions focusing on cost reduction and lightweight designs, the importance of application scenarios, and the division of the robot market into two main segments: equipment and data/visualization [6]. - The report suggests that monetary and fiscal policies are being strengthened, which may lead to a new recovery cycle in the equipment industry. Key companies to watch include Huichuan Technology, Xinjie Electric, and Weichuang Electric in the industrial control sector, and various companies in the robotics and machine tool sectors [6]. Summary by Sections Industry Overview - The mechanical industry consists of 632 listed companies with a total market capitalization of approximately 6,323.2 billion yuan and a circulating market value of about 5,266.4 billion yuan [3]. Company Earnings Forecasts and Valuations - Key companies and their projected earnings per share (EPS) and price-to-earnings (PE) ratios for 2025E to 2027E are as follows: - Huichuan Technology: EPS of 2.12 yuan in 2025E, PE of 38.60 [2]. - Flantak: EPS of 0.60 yuan in 2025E, PE of 18.12 [2]. - Xinjie Electric: EPS of 1.83 yuan in 2025E, PE of 34.64 [2]. - Oke Yi: EPS of 0.71 yuan in 2025E, PE of 32.04 [2]. - Lanjian Intelligent: EPS of 1.50 yuan in 2025E, PE of 25.98 [2]. Market Performance - The mechanical sector has shown a 1.5% increase in the past week, while the overall market performance of the Shanghai Composite Index was -1.3% [10][15]. - Among sub-sectors, boiler equipment had the highest increase at 12.3%, while shipbuilding had the lowest at -4.0% [11]. Investment Recommendations - The report emphasizes the importance of focusing on companies in various sectors, including industrial control, robotics, machine tools, and testing industries, suggesting a broad range of investment opportunities [6][21].