Report Industry Investment Rating - The investment rating for asphalt is "Bearish" [1] Core Viewpoints of the Report - In 2026, asphalt demand is unlikely to improve significantly due to financial constraints on road projects and shrinking housing new construction areas. The cost side will be a more important concern. Oil prices will face supply pressure at least in the first half of 2026, and the asphalt price is expected to continue to decline. If the downward pressure on the cost side eases, the price may bottom out during the seasonal demand peak in the second half of the year. The annual price is projected to range between 2,600 - 3,400 yuan/ton [3][70][71] Summary by Relevant Catalog 1. 2025 Annual Review of Asphalt Market - **Domestic Supply Increase and Resilient Imports**: From January to November 2025, the national petroleum asphalt production reached 26.4 million tons, a year - on - year increase of 9.75%. The increase in supply was mainly due to the decline in international oil prices and the widening discount of diluted asphalt. Local refineries' production was more volatile, with an output of 14.35 million tons, a year - on - year increase of 16.13%, while the output of major refineries was 12.05 million tons, a year - on - year increase of 3.02%. In the same period, the domestic asphalt import volume reached 3.55 million tons, a year - on - year increase of 9.2%, with Middle Eastern asphalt gradually squeezing the market share of Southeast Asian countries [17][26] - **Demand Growth Driven by Road Project Deliveries**: In 2025, as the end - year of the 14th Five - Year Plan, road construction projects entered the concentrated delivery period. From January to November 2025, the apparent consumption of asphalt reached 29.36 million tons, a year - on - year increase of 9.25%, with a 25% year - on - year increase in the third quarter. However, highway investment continued to decline, and the waterproofing market demand was weak due to the low real - estate climate [28] 2. Persistent Tight Funds, Road Demand Hard to Improve Substantially - **New Road Construction**: Most road construction projects rely on government fiscal funds or special bonds. Currently, local governments face significant financial pressure, making it difficult for project funds to be in place in a timely manner. Although the new special bond issuance increased in 2025, the funds available for new road projects continued to shrink [37][38] - **Road Maintenance**: The maintenance funds for expressways and ordinary national and provincial roads are facing shortages. The establishment of toll stations can only meet their own funding needs, and the overall road maintenance fund gap will exist for a long time [40] 3. Refineries without Quotas Gradually Exit, No Excessive Concerns about Raw Material Imports - **Exit of Refineries without Quotas under New Consumption Tax Deduction Policy**: Since 2025, Shandong Province has adjusted the consumption tax deduction policy for local refineries, which has led to an increase in asphalt production costs. From January to November 2025, the cumulative import of diluted asphalt decreased by 40% year - on - year, and many small and medium - sized local refineries without quotas have stopped production [43][44] - **Limited Impact of US Sanctions on Raw Material Imports**: Although the US has imposed sanctions on Venezuela and Russia, the supply of asphalt raw materials remains stable overall. In 2025, the import of Merey crude oil increased significantly, and other oil types such as Urals, Buzios, and Mero also became important supplements [52][54] 4. International Oil Prices are Still Suppressed by Supply Release, Cost - Side Rebound is Restricted - **Supply Growth in Non - US and Non - OPEC+ Countries**: In 2026, the global crude oil production is expected to reach 79.55 million barrels per day, with non - US and non - OPEC+ countries contributing an incremental supply of 230,000 barrels per day. Brazil, Canada, and Guyana will be the main sources of supply growth [61] - **Inventory Pressure**: Since September 2025, the global crude oil floating storage has increased sharply. If the floating storage is released into the market, it will put pressure on oil prices in the first half of 2026 [67] 5. Investment Recommendations - In 2026, the asphalt price is expected to continue to decline in the first half of the year. If the downward pressure on the cost side eases, it may bottom out during the seasonal demand peak in the second half of the year. The annual price is projected to range between 2,600 - 3,400 yuan/ton [71]

Report Industry Investment Ratings No relevant content found. Core Views of the Report - The stock market may start a cross - year rally, with the Shanghai Composite Index potentially hitting 4000 points again, and it is recommended to evenly allocate long positions in various stock index futures [1][19]. - The U.S. dollar is expected to remain weak, and it is recommended to be bearish on the U.S. dollar [2][14][15]. - U.S. stocks are expected to fluctuate strongly, and it is recommended to hold a positive view on the short - term trend of U.S. stocks [16][17]. - The long - term bond market is building a bottom and is expected to strengthen in the short - to - medium term, while the short - term bond interest rate has limited downward space [24]. - Palm oil is expected to enter a consolidation phase, and it is recommended to wait for the opportunity to go long on the 05 contract; for rapeseed oil, it is recommended to focus on short - term positive spreads between near - and far - term contracts [26]. - Steel prices are expected to fluctuate, and it is recommended to adopt a range - trading approach [28][29]. - Coal prices are expected to continue to decline in the short term [30][32]. - Iron ore prices are expected to remain range - bound [33]. - Lead prices are expected to fluctuate, and it is recommended to wait and see both in single - side trading and arbitrage [34][35]. - Zinc prices are volatile in the short term, and it is recommended to reduce positions or establish hedging positions; in the medium term, it is recommended to look for opportunities to buy on dips [37]. - Lithium carbonate prices may pull back in the short term, but the long - term strategy is to buy on dips [38]. - Nickel prices are expected to return to a range - bound state [40]. - Copper prices may experience short - term corrections, and it is not recommended to chase the high. Instead, it is recommended to wait for opportunities to buy on dips for mid - term long positions [44][45]. - Tin prices are expected to adjust at a high level in the short term, and investors should be vigilant against price drops when the capital enthusiasm fades [51]. - Oil prices are weakly fluctuating. During the overseas holiday period, trading is light, and attention should be paid to the progress of Russia - Ukraine negotiations [51]. - Asphalt prices are expected to remain weak [53]. - Urea's 01 contract is expected to fluctuate within a range, and the 05 contract should focus on post - holiday spring plowing demand and new export quota policies [55][56]. - LLDPE prices are expected to rebound, and it is recommended to wait for opportunities to establish short positions after the rebound [57][58]. - Methanol prices are expected to remain strong, and it is recommended to take a bullish approach, targeting the 2200 - 2250 range [59]. Summaries According to Related Catalogs 1. Financial News and Reviews 1.1 Macro Strategy (Gold) - The initial jobless claims in the U.S. last week were 214,000, lower than the expected 224,000. The employment market shows no rapid deterioration, but the cooling trend remains. During the Christmas and New Year holidays, the risk of market volatility increases, and it is not recommended to chase the high in precious metals [10][11]. 1.2 Macro Strategy (Foreign Exchange Futures - U.S. Dollar Index) - A U.S. federal judge ruled that the Trump administration's new rule of a $100,000 H - 1B visa application fee is legal, which is a blow to U.S. technology companies. A U.S. official downplayed the possibility of further military action against Venezuela. The U.S. initial jobless claims decreased to 214,000. The labor market is short - term stable, market risk appetite rises, and the U.S. dollar remains weak [12][13][14]. 1.3 Macro Strategy (U.S. Stock Index Futures) - The U.S. employment market shows signs of improvement. With the GDP data exceeding expectations and the unemployment claims data decreasing, the market is optimistic about future interest rate cuts and a soft landing. The S&P 500 has reached a new high, and U.S. stocks are expected to fluctuate upward [16][17]. 1.4 Macro Strategy (Stock Index Futures) - The Shanghai Composite Index has achieved six consecutive positive days. Beijing has optimized real - estate policies, and with continuous high trading volume, a cross - year rally may start, and the index may hit 4000 points again. It is recommended to evenly allocate long positions in various stock index futures [1][18][19]. 1.5 Macro Strategy (Treasury Bond Futures) - The central bank will conduct a 400 - billion - yuan MLF operation. The long - term bond market is building a bottom. It is expected to strengthen in the short - to - medium term, with the curve mainly dominated by long - term bonds. It is recommended that allocation investors buy on interest rate increases, and trading investors buy on dips and exit quickly [24][25]. 2. Commodity News and Reviews 2.1 Agricultural Products (Soybean Oil/Rapeseed Oil/Palm Oil) - The MPOA data shows that palm oil production in Malaysia from December 1 - 20 decreased by 7.44% month - on - month, verifying the production cut expectation. The supply pressure of palm oil is expected to ease. The supply of rapeseed oil in the near - term is tight, and inventories are declining. It is recommended to wait for the opportunity to go long on palm oil's 05 contract and focus on short - term positive spreads of rapeseed oil [26]. 2.2 Black Metals (Rebar/Hot - Rolled Coil) - South Africa launched an anti - dumping investigation on Chinese color - coated steel. The total new contracts signed by five major construction central enterprises in the first 11 months exceeded 6.5 trillion yuan. Steel prices are slightly rebounding, but the increase is limited. The supply - demand contradiction may accumulate in the future, and it is recommended to trade within a range [27][28][29]. 2.3 Black Metals (Steam Coal) - The total social power consumption in November increased by 6.2% year - on - year. Coal prices continue to decline, and due to warm winter weather, the demand growth rate is expected to be negative. With high port inventories, coal prices are expected to continue to fall in the short term [30][32]. 2.4 Black Metals (Iron Ore) - The National Housing and Urban - Rural Construction Work Conference was held, emphasizing key tasks for 2026. The iron ore market is seasonally weak, with expected decline in iron - making water this week. Considering the off - season demand, ore prices are expected to remain range - bound [33]. 2.5 Non - ferrous Metals (Lead) - The LME 0 - 3 lead is at a discount of $42.3 per ton. LME inventories decreased, and the cash spread fluctuated. Domestic social inventories are declining. Due to environmental protection, the production of recycled lead is affected, and the demand is weak. Lead prices are expected to fluctuate, and it is recommended to wait and see [34][35]. 2.6 Non - ferrous Metals (Zinc) - The LME 0 - 3 zinc is at a discount of $29.14 per ton. LME inventories increased, and the cash spread fluctuated. Domestic social inventories are increasing. Zinc prices are volatile in the short term and may rise in the medium term. It is recommended to reduce positions or hedge in the short term and buy on dips in the medium term [36][37]. 2.7 Non - ferrous Metals (Lithium Carbonate) - Ningde Times' Yichun Jixiawo lithium mine is expected to resume production around the Spring Festival. Short - term prices may pull back, but long - term strategy is to buy on dips [38]. 2.8 Non - ferrous Metals (Nickel) - LME nickel inventories increased. Indonesia plans to set a lower nickel ore production quota in 2026. The market is skeptical about this plan. The cost of nickel smelting may increase. Nickel prices are expected to return to a range - bound state [39][40]. 2.9 Non - ferrous Metals (Copper) - Multiple copper - related projects are in progress. Short - term copper prices are supported by macro factors but may be affected by changes in macro expectations and inventory accumulation. It is recommended not to chase the high and wait for opportunities to buy on dips for mid - term long positions [44][45]. 2.10 Non - ferrous Metals (Tin) - Turkey imposed anti - dumping duties on Chinese tin - plated steel. The inventories of SHFE and LME tin increased. The supply shortage has eased in the short term, and demand is weak. Tin prices are expected to adjust at a high level in the short term [51]. 2.11 Energy Chemicals (Crude Oil) - The loading volume of the CPC pipeline in December decreased. Oil prices are weakly fluctuating. Overseas trading is light during the holiday period. Attention should be paid to the progress of Russia - Ukraine negotiations [51]. 2.12 Energy Chemicals (Asphalt) - The capacity utilization rate of domestic heavy - traffic asphalt increased. Asphalt prices are declining, and due to the off - season demand, prices are expected to remain weak [52][53]. 2.13 Energy Chemicals (Urea) - Urea enterprise inventories decreased. The 01 contract is expected to fluctuate within a range, and the 05 contract should focus on post - holiday spring plowing demand and new export quota policies [55][56]. 2.14 Energy Chemicals (LLDPE) - The inventory of Chinese polyethylene production enterprises decreased. LLDPE prices rebounded, but it is not a reversal. It is recommended to wait for opportunities to establish short positions after the rebound [57][58]. 2.15 Energy Chemicals (Methanol) - Chinese methanol port inventories increased, but the actual increase may be less. With the overall rebound of the chemical industry, methanol prices are expected to remain strong. It is recommended to take a bullish approach, targeting the 2200 - 2250 range [58][59].

Report Industry Investment Rating - Stock index: Bullish [6] Core View of the Report - The report is cautiously optimistic about China's macro - economy in 2026 but positive about the A - share market. It predicts that the A - share market will shift from valuation - driven to a mode of both valuation and profit contribution, with an expected annual index increase of about 10%. The long - term bull market in A - shares may continue throughout the "14th Five - Year Plan" period [4][103]. Summary by Directory 1. 2025 Year Review: A Feast of Equities - In 2025, it was a feast for equity assets globally. Global stock markets generally rose, supported by three common factors: global fiscal and monetary "double - easing", the AI industry trend, and the "de - dollarization" narrative [16]. - In China's A - share market, it showed a diverse and hot state. Most indices rose by over 20%, with micro - cap stocks performing best. The significant difference in performance between micro - cap stocks and blue - chip weight indices was mainly due to institutional behavior and capital attributes [24]. 2. 2026 Domestic Macroeconomic Outlook: Moderate Recovery and Deepening Differentiation 2.1 Exports: Room for Surplus Remains, and Resilience Continues in 2026 - In 2025, China's exports grew strongly, with a trade surplus reaching a record high. The market has debated the balance of the trade surplus, but China's trade surplus/GDP still has room to expand [30][31]. - In 2026, although global demand may slow down, China's active economic and trade policies and the certainty of Chinese enterprises going global will support exports. The export growth rate is predicted to be around 3 - 4% [42]. 2.2 Real Estate: In the Stock Era with Moderate Policies, It May Still Decline in 2026 - The real estate industry has entered the stock era, with the housing supply approaching saturation. It still has a strong financial attribute, and the pessimistic market expectations may lead to a continued decline in 2026 [43][45]. - The continuous adjustment of the real estate industry will affect residents' wealth and total demand, putting pressure on domestic demand [50]. 2.3 Fiscal Policy: Small - scale Total Growth and Possible Structural Re - equilibrium - In 2025, China's fiscal policy was more active, with an increased deficit rate and special bonds. The fiscal expenditure structure shifted towards people - oriented investment, weakening investment in infrastructure [56][58]. - In 2026, the fiscal policy will maintain an active tone but with limited expansion. The structure may be re - balanced, and the pace will be front - loaded, with obvious guidance on industrial policies [62]. 2.4 Monetary Policy: Limited Easing Space, More Focus on Flexibility and Precision - In 2025, the central bank's monetary easing had limited impact on credit expansion. Constrained by factors such as low corporate returns and high mortgage rates, the central bank's further interest rate cuts are restricted [63]. - In 2026, the central bank will maintain a loose policy, use various policy tools more flexibly, and support industrial upgrading and domestic demand expansion [69]. 2.5 Inflation: The Contradiction between Capacity Reduction and Capacity Increase - In 2026, China's industrial production capacity is still in a state of over - supply. The "anti - involution" policy aims to reduce capacity, but it faces challenges in implementation [71][73]. - At the same time, new fixed - asset investments will increase production capacity. On the consumer side, the expansion of service consumption will support CPI. It is predicted that PPI will recover to around - 1% and CPI to around 0.8% [74][81]. 3. 2026 Stock Index Outlook: The Long - term Bull Market Continues - The current A - share market valuation is not low, and the space for further valuation expansion in 2026 is limited, with the target P/E ratio estimated to be between 20 - 24x [96]. - It is predicted that the profit growth rates of the entire A - share market, non - financial stocks, and financial stocks in 2026 will be 4.5%, 8.4%, and 1.0% respectively, showing an N - shaped trend throughout the year [100]. - In terms of capital preferences, technology stocks and blue - chip growth stocks are expected to outperform in 2026 [102]. 4. Investment Advice: Continue to Hold the Long - Position Strategy for Stock Indices - Be cautiously optimistic about China's macro - economy in 2026 but positive about the A - share market. The long - term bull market in A - shares will continue, and the long - position strategy is recommended [4][103]. - Favor the CSI 1000 Index Futures (IM) with a high proportion of technology stocks and the SSE 50 Index Futures (IF) with more blue - chip stocks. The performance of the CSI 500 Index Futures (IC) may be weaker in 2026 [105].

1. Report Industry Investment Ratings - The report is bullish on Europe, bearish on the US dollar, and expects the Japanese yen to appreciate [2][5][8]. 2. Core Views of the Report - In 2026, it will be a year dominated by liquidity. Ample liquidity and loose monetary policies lead to the spill - over of US dollar liquidity, rising asset prices, but the problem of de - globalization remains unsolved, and the pressure of long - term stagflation intensifies [4]. - The US economy is in a weak recovery during the interest - rate cut cycle, with a significant increase in potential stagflation pressure. The eurozone economy has stabilized, and the euro will maintain an upward trend. The Japanese yen is expected to appreciate in 2026 [1][2][3]. - The Fed's aggressive interest - rate cut policy and the expansion of US dollar liquidity will be the most important trends in 2026. The US dollar index is expected to continue to weaken significantly, dropping to around 90, with a larger decline in the second half of the year. Commodities, especially precious metals and non - ferrous metals, will continue to rise [5]. 3. Summary According to the Table of Contents 3.1 US: Accelerated Liquidity Injection and Hidden Stagflation Pressure 3.1.1 Labor Market: Accelerated Weakening Trend - In 2026, the US labor market will trend towards a significant weakening. The "inflection point" of the labor market has appeared, and the unemployment rate is expected to rise. The decline in the labor market is a gradual process, and the "atypical recession" of the labor market will continue. The problem of structural imbalance in the labor market caused by the expulsion of illegal immigrants may keep wage growth relatively high [14][16]. 3.1.2 Economic Recovery or Hidden Stagflation - In 2026, due to the mid - term elections, the Trump administration will maintain the current tariff level. US inflation is mainly driven by inflation inertia, wage growth expectations, and marginal liquidity. Liquidity injection is likely to be a neutral factor for inflation in 2026, and the overall inflation center in the US is expected to remain at around 3% year - on - year. The economy will experience a process of weakening and then slow recovery, and the real estate sector may be boosted [23][34]. 3.1.3 US Dollar: Continued Weakness - In 2026, the US dollar index will continue to weaken. The Fed is expected to cut interest rates rapidly, which will improve the liquidity within the system and relieve the government's debt pressure. Although inflation can remain relatively stable, the US dollar index will remain weak, and the real interest rate is expected to approach 0%. The Fed may face potential pressure to expand its balance sheet to maintain a relatively flat yield curve [37][45]. 3.2 Eurozone and Japan 3.2.1 Eurozone: Economic Strength and Currency Appreciation - The eurozone economy is in a continuous recovery state, with stable inflation and rising consumer and business confidence. Even if the Russia - Ukraine conflict reaches a cease - fire agreement, the EU will continue to expand its fiscal deficit. Fiscal policy is more important than monetary policy. The euro and European stocks performed strongly in 2025, and the current economic model of fiscal expansion and monetary stability is beneficial to the eurozone economy [46][58]. 3.2.2 Japan: Continued Appreciation of the Yen - Japan's economy is in a positive cycle, with rising GDP growth, inflation, consumer confidence, and corporate loan growth. The Bank of Japan will continue to raise interest rates. Although the expansion of fiscal deficit exerts downward pressure on the yen, the Fed's interest - rate cuts and the Bank of Japan's interest - rate hikes will lead to a rapid decline in the US - Japan interest - rate differential, which will cause the yen to appreciate. The expansion of US dollar liquidity is expected to offset the contraction of yen liquidity [61][83]. 3.3 Global Macroeconomy: From Loose to Ample Liquidity, from Simple to Complex Situation - In 2026, global market liquidity will shift from loose to ample, and asset prices will continue to rise. The weak US dollar will lead to the spill - over of US dollar liquidity and the rise of non - US assets. However, loose liquidity does not solve the problem of de - globalization, and more radical policies may be introduced in 2027. The Russia - Ukraine conflict is unlikely to end in the short term, and the risk premium of safe - haven assets will continue to exist. The influence of fiscal policy on the global market is increasing, which will lead to long - term and irreversible inflation [84][91]. 3.4 Investment Recommendations 3.4.1 Weak US Dollar as the Main Trend in 2026 - The Fed's aggressive interest - rate cut policy and the expansion of US dollar liquidity will cause the US dollar index to continue to weaken significantly in 2026, dropping to around 90, with a larger decline in the second half of the year [93]. 3.4.2 Obvious Opportunities in Commodities - The accelerated injection of liquidity and the potential increase in inflation pressure will boost commodities, especially precious metals and non - ferrous metals, which will continue to rise in 2026 [94].

年度报告——铁矿石 报告日期： ★ 供应：25 年全球海漂供应 3700 万吨，26 年增 5100 万吨 25 年铁矿发货节奏前低后高，年中开始，伴随主要矿山"降品 保量"，全球发货量快速回升。预计 2025 年全球铁矿石供应增 长约 3700 万吨，2026 年增长扩张至 5100 万吨。 黑 各大矿山纷纷主动"降品增量"，导致 2025 年铁矿结构性库存 矛盾似有重现。矿山主流品质下滑，以及金布巴库存锁定，一 定程度上解释了 2025 年下半年以来，港口高库存量和现货价格 坚挺的背离。展望 2026 年，我们预计全球铁矿石供应增幅扩大 至 5100 万吨。西芒杜首船试运之后，或需等待 26 年年中明显起 量。接驳能力和多方博弈或对发运造成向下扰动。 色 金 ★ 需求：粗钢需求或前低后高，韧性较强但缺乏增量 属 2025 年实际需求表现远超市场预期。根据 Mysteel 铁水和富宝废 钢折算，2025 年全年粗钢表需增长约 2%，铁水增长约 2.3%。经 历 2025 年出口韧性验证后，市场对 2026 年需求预期转向谨慎， 主流预期保持在零增长附近。分项来看，地产持续下滑，基建 十五五开局预计微增，直接 ...

1. Report Industry Investment Rating - Zinc: Bullish [1] 2. Core Viewpoints - In 2026, the growth rate of global zinc ore production will decline, and the increment will mainly concentrate in China. The overseas increment will be mainly non - standard ore. The import of zinc ore may be restricted by the price ratio. The mine - smelting balance will tighten, the TC operation center will be lower than in 2025, and the zinc price operation center will be higher [2][165]. - In 2026, domestic zinc smelters are expected to continue to release production capacity, while overseas smelters' resumption of production will be restricted. Domestic demand growth will slow down, with infrastructure still providing support and durable consumption under pressure. External demand, especially from emerging markets, is expected to perform well. The zinc price may maintain a pattern of domestic weakness and overseas strength, and the zinc ingot export window may open periodically [3][165]. - The decline in the TC center will support the zinc price in the long - term. The upper limit of the zinc price depends on demand and the macro - environment. In 2026, the zinc price is expected to rise, with the Shanghai zinc price in the range of 【21600, 25200】 and the LME zinc price in the range of 【2750, 3500】. It is recommended to buy on dips in the medium - term and focus on inter - period reverse arbitrage and internal - external positive arbitrage opportunities [4][170]. 3. Summary by Directory 3.1 Market Review - In 2025, due to the expectation of supply - demand surplus caused by the zinc ore loosening cycle, SHFE zinc became a short - position variety in most capital strategies. The annual shock center of SHFE zinc decreased slightly year - on - year, while that of LME zinc increased marginally. The core reason for the price differentiation between the two was the structural imbalance of the global supply chain [16]. - The cycle from loose zinc ore to loose zinc ingot in 2025 was only half - completed in China, and the overseas half remains to be completed. In 2026, the zinc market story may revolve around overseas smelters' resumption of production, price ratio repair, and improvement in domestic and overseas consumption [17]. 3.2 Supply Side 3.2.1 Mine End - In 2025, overseas mines had a smooth production, and the mine end continued to advance along the loose - cycle. The increment mainly came from overseas mines, and domestic smelters' production capacity release mainly relied on imported ores. The main reasons for the strong performance of overseas mines were the continuous output of resumption and production - increase projects, driven by factors such as the decline in energy prices, fewer extreme weather events, and improved interest - rate environment [20][22]. - From 2025 to 2030, the annual growth rate of zinc ore production is expected to gradually decline, and after 2030, the global zinc ore production will enter a downward channel. In 2026, overseas mines are expected to increase production by about 21.8 million tons, and the increment that can be realized with a high probability is about 12 million tons. In China, domestic zinc ore is expected to enter a production - increasing period, with an expected increment of 21.8 million tons without considering the implementation rate [30][31][37]. - In 2025, China's zinc concentrate import dependence was about 40%, an increase of about 5.8 percentage points compared with 2024. In 2026, domestic zinc concentrate supply may face the problem of import bottlenecks again. The TC center has shifted from a significant upward trend to a downward trend, indicating that the loosest point of zinc ore supply has passed [40][41]. 3.2.2 Smelting End - In 2025, the global zinc ingot production increased slightly year - on - year, showing a pattern of rising in the East and falling in the West. Domestic smelters fully released production capacity, while overseas smelters significantly reduced production. The reasons for overseas smelters' production reduction were the suppression of the benchmark processing fee and the extrusion of domestic smelters' production capacity [49][53]. - In 2026, overseas smelters will mainly focus on resuming production, but the resumption speed may be slow, and the actual zinc ingot increment may be lower than the theoretical calculation, with a neutral expected increment of about 140,000 tons. Domestic smelting production capacity is expected to continue to be released, but the production - increasing space will be relatively limited [59][61]. - In 2025, the proportion of domestic and global recycled zinc production decreased marginally. In 2026, the supply of recycled zinc raw materials may improve marginally, but the increase in recycled zinc production will be limited. In 2025, the import of zinc ingots decreased, and in 2026, the long - term import order volume of zinc ingots may decline significantly, and China may even become a net exporter in some months [67][73]. 3.2.3 Mine - Smelting Balance - In 2026, the overseas zinc ore increment will decline year - on - year, while domestic ore is expected to increase significantly. The mine - end increment is difficult to meet the joint release of domestic and overseas smelting production capacity, and the loosest stage of the mine end may have passed. The TC oscillation center at home and abroad will move down, supporting the zinc price. In the long - term, the resumption environment of overseas smelters in 2026 is still not optimistic [78]. 3.3 Demand Side 3.3.1 Initial - Stage Demand - In 2025, the initial - stage demand for zinc was mediocre, and the downstream operating rate was at a relatively low - to - neutral level. The galvanizing field mainly fluctuated with infrastructure and export demand, while the die - casting zinc alloy was affected by construction demand, and the zinc oxide field showed demand differentiation. The downstream replenishment willingness was still low, and the finished - product inventory was at a low level, indicating strong terminal consumption ability [83][85]. 3.3.2 Traditional Demand - In 2025, the zinc consumption in the infrastructure field improved limitedly. The issuance of new special bonds was relatively stable, but the funds allocated to actual infrastructure projects decreased. The actual operation of infrastructure investment was weak. In 2026, the infrastructure is expected to be optimistic, with an increase in new special bonds and more projects driven by the central government and policies, and the zinc consumption in the infrastructure field is expected to increase by 3.5% year - on - year [96][100][108]. - The real estate is still in the inventory clearance cycle, and the demand for zinc in the construction sector is expected to continue to be dragged down in 2026, but the drag amplitude will be weakened, with an expected zinc consumption growth rate of - 9% [111]. 3.3.3 Durable Consumption Demand - In 2025, the demand for durable consumer goods was strong, mainly driven by policies and exports. In 2026, the domestic demand for automobiles and home appliances may face growth pressure, with an expected growth rate of about 0.5% for automobile zinc consumption and - 2% for home appliance zinc consumption [114][125][127]. 3.3.4 Overseas Demand - In 2025, the export of zinc - processed products increased significantly, and the overseas zinc consumption gradually recovered. In 2026, the export of zinc - processed products is expected to maintain high - level growth, and the overall overseas zinc consumption is expected to grow by 2.8%, especially in emerging regions [135][143][157]. 3.4 Inventory Side - In 2025, the global zinc ingot visible inventory showed an oscillatory decline trend. The increase in domestic social inventory was not enough to offset the decline in LME inventory. The inventory in the industrial chain increased, and the accumulation of domestic social inventory was limited [158]. 3.5 Investment Suggestions - Fundamental Outlook: The mine - smelting balance will tighten, and the zinc price operation center may move up. The zinc ingot balance may show domestic surplus and overseas tightness, and the zinc price may maintain a pattern of domestic weakness and overseas strength [165]. - Trading and Price Outlook: The decline in the TC center will support the zinc price in the long - term. The zinc price is expected to rise in 2026, with the Shanghai zinc price in the range of 【21600, 25200】 and the LME zinc price in the range of 【2750, 3500】. It is recommended to buy on dips in the medium - term, focus on inter - period reverse arbitrage and internal - external positive arbitrage opportunities [170]. - Rhythm and Risk: Before the long - term mine - smelting order is finalized, the zinc price is still likely to rise. After April, the zinc price may be under pressure. There is a possibility of the market pre - trading the long - term shortage expectation of zinc elements. Risks include the progress of Huoshaoyun's production, tariff risks, domestic and overseas demand uncertainties [172].

Report Industry Investment Ratings No relevant content provided. Core Views of the Report - The US economy grew by 4.3% in Q3 2025, with the US API crude oil inventory rising. Market risk appetite has rebounded, and various asset classes show different trends [1][6]. - A-shares are in a narrow - range consolidation with increasing trading volume, potentially accumulating momentum for a cross - year market [23]. - The bond market is approaching a critical point, with a higher probability of short - term adjustment than direct upward movement [25]. Summary by Directory 1. Financial News and Comments 1.1 Macro Strategy (Gold) - The US Q3 GDP exceeded expectations, and gold prices first declined and then rose. Gold and silver are still in an upward trend, but attention should be paid to the risks and increased volatility caused by short - term profit - taking of long positions [11]. 1.2 Macro Strategy (Foreign Exchange Futures - US Dollar Index) - The US economy grew by 4.3% in Q3 2025. The market risk appetite has rebounded, and the US dollar will fluctuate in the short term [12][14]. 1.3 Macro Strategy (US Stock Index Futures) - The US Q3 GDP growth was the fastest in two years. The market risk appetite remains high, and the US stock market is expected to be in a volatile and slightly upward trend [19][20]. 1.4 Macro Strategy (Stock Index Futures) - A - shares had a narrow - range consolidation with increasing trading volume on December 23. It is recommended to evenly allocate long positions in various stock indices [21][23][24]. 1.5 Macro Strategy (Treasury Bond Futures) - The central bank conducted a 7 - day reverse repurchase operation of 59.3 billion yuan, with a net withdrawal of 76 billion yuan on the day. The long - term varieties are bottom - building. It is recommended that allocation investors buy when interest rates rise, and trading investors buy at low prices and exit quickly [25][26]. 2. Commodity News and Comments 2.1 Black Metal (Coking Coal/Coke) - The coking coal prices in the Changzhi market showed mixed trends. Currently, coking coal supply and demand are both weak. It is necessary to pay attention to downstream restocking [27][28]. 2.2 Black Metal (Rebar/Hot - Rolled Coil) - Turkey imposed anti - dumping duties on Chinese tin - plated coils. The global crude steel output in November decreased by 4.6% year - on - year. Steel prices are expected to fluctuate, and it is recommended to adopt a volatile trading strategy [29][31][33]. 2.3 Agricultural Products (Pigs) - A major shareholder of Juxing Agriculture pledged 18.5 million shares. In the short and medium term, the supply pressure remains unchanged. It is recommended to short at high prices for the 03 contract and consider long positions for far - month contracts at low prices [34]. 2.4 Non - ferrous Metals (Polysilicon) - The trading limit of polysilicon futures contracts was adjusted. The polysilicon inventory is still accumulating, and demand is weak. It is expected that the spot price may be difficult to fall, but it depends on whether the price increase can be passed on to downstream industries. It is recommended that investors hold positions cautiously [35][36][38]. 2.5 Non - ferrous Metals (Industrial Silicon) - The designated delivery warehouse and quality inspection institution of industrial silicon futures were adjusted. The supply and demand of industrial silicon depend on the production reduction rhythm of enterprises. It is recommended to pay attention to short - selling opportunities at high prices [38][41][42]. 2.6 Non - ferrous Metals (Lead) - The LME lead had a large - scale backwardation. The supply and demand of lead are both weak, and it is recommended to trade with a volatile strategy [43]. 2.7 Non - ferrous Metals (Zinc) - The LME zinc had a backwardation. The short - term fundamentals of zinc are not highly contradictory, and it is recommended to buy on dips and hold positive spreads and conduct reverse arbitrage between domestic and foreign markets [44][45]. 2.8 Non - ferrous Metals (Lithium Carbonate) - Exar applied for incentives for capacity expansion. The short - term sentiment is supported, but there is a callback risk after the resumption of production by large enterprises. It is recommended to go long on dips in the medium and long term [47][48]. 2.9 Non - ferrous Metals (Nickel) - China's refined nickel imports in November increased significantly. Indonesia plans to reduce nickel ore production in 2026. It is recommended to go long on dips if cobalt pricing is implemented, and short at high prices if the production quota expectations are not met [49][50][52]. 2.10 Non - ferrous Metals (Tin) - The LME tin had a contango. The supply of tin ore is uncertain, and demand is weak. Inventory accumulation is a short - term pressure on prices. It is necessary to be vigilant against price drops [53][54][57]. 2.11 Energy and Chemicals (Crude Oil) - The US API crude oil inventory increased. Oil prices rebounded due to increased market risk appetite and geopolitical risks. Short - term oil prices will be disturbed by geopolitical conflicts [58][59]. 2.12 Energy and Chemicals (Carbon Emissions) - The CEA price rose on December 23. The short - term market risk is high [60][61]. 2.13 Shipping Index (Container Freight Rates) - ZIM rejected the management's acquisition offer. The freight rate increase was not realized, and it is recommended to pay attention to short - selling opportunities at high prices [62][63].

1. Report Industry Investment Ratings - **Foreign exchange futures (US Dollar Index)**: Bearish, suggesting the US Dollar Index will weaken [13] - **US stock index futures**: Expected to trend strongly with oscillations [15] - **Stock index futures**: Long - position allocation of various stock indices in a balanced manner [18] - **Treasury bond futures**: Long - term varieties are bottoming out. Allocation investors can buy when interest rates rise, and trading investors can buy on dips and exit quickly [22] - **Black metals (rebar/hot - rolled coil)**: Adopt an oscillatory mindset towards steel prices [25] - **Agricultural products (soybean meal)**: Expected to remain weak. In the absence of major South American weather anomalies, consider shorting on rallies for the May contract [26] - **Black metals (coking coal/coke)**: In the short term, coking coal lacks upward momentum. Pay attention to downstream restocking [29] - **Non - ferrous metals (lead)**: In a single - sided trade, focus on opportunities to stop losses on short positions; in arbitrage, adopt a wait - and - see approach [33] - **Non - ferrous metals (zinc)**: In a single - sided trade, look for opportunities to buy on pullbacks; in a calendar spread, maintain long positions in positive spreads; in an international spread, consider reverse arbitrage [37] - **Non - ferrous metals (polysilicon)**: Spot prices are expected to be resistant to decline. New prices' success depends on downstream price transmission. Due to large price fluctuations and risk - control measures, investors are advised to hold positions with caution [42] - **Non - ferrous metals (industrial silicon)**: Current production cuts are insufficient to reverse the inventory build - up. Consider shorting on rallies [45] - **Non - ferrous metals (lithium carbonate)**: In the short term, strong inventory reduction and postponed production resumption support bullish sentiment. However, after production resumes and demand weakens in the off - season, prices may correct. In the long - term, consider buying on dips [47] - **Non - ferrous metals (copper)**: In a single - sided trade, expect high - level oscillations; in arbitrage, adopt a wait - and - see approach [51] - **Non - ferrous metals (nickel)**: If cobalt pricing is implemented, consider mid - term long positions on dips. If RKAB is set at 250 million wet tons, nickel prices will rise significantly. But if both expectations are unmet, consider shorting on rallies [56] - **Energy and chemicals (crude oil)**: Short - term risk premiums support oil prices, with increased volatility [60] - **Energy and chemicals (asphalt)**: Short - term prices are expected to be stable at the bottom [62] - **Energy and chemicals (PTA)**: The short - term market remains strong. Hold long positions and monitor downstream negative feedback [65] - **Energy and chemicals (urea)**: For the 01 contract, expect oscillations. For the 05 contract, after a certain margin of safety is provided, consider low - buying to bet on spring - farming restocking and new export quota policies [67] - **Energy and chemicals (styrene)**: Temporarily maintain an oscillatory pattern. In the medium - term, look for low - buying opportunities [70] - **Energy and chemicals (caustic soda)**: Supply - demand contradictions have eased. A decline in liquid chlorine prices may support caustic soda prices [72] - **Energy and chemicals (PVC)**: In the short term, expect low - level oscillations. In 2026, new production capacity is limited, and exports are expected to improve. If low - valuation persists before and during spring maintenance, there may be an upward trend [74] 2. Core Views - Trump is expected to nominate a new Fed Chairman in early January, boosting market risk appetite and causing the US Dollar Index to decline [12] - The Fed's internal differences over interest rate cuts are significant, and the market may re - price the long - term interest rate cut path. Short - term risk appetite has improved [14] - After the Bank of Japan's less - than - expected interest rate hike, A - shares have increased in volume, and the market is in an offensive state [17] - With the unchanged policy interest rate and rising risk appetite, Treasury bond futures have declined, but long - term varieties are bottoming out [20] - Steel prices are oscillating strongly, with short - term supply - demand contradictions not prominent, and the market is starting to bet on winter stockpiling [24] - The supply of imported soybeans is sufficient, and soybean meal inventory has increased again. The market lacks bullish factors [26] - Coking coal and coke are in a state of weak supply and demand. Pay attention to downstream restocking and future supply - demand changes [28] - The lead market is in a state of weak supply and demand, and prices are likely to oscillate [33] - The zinc market's short - term fundamentals have few contradictions, and prices are likely to rise in the medium - term [37] - The polysilicon market has a problem of inventory build - up and weak demand. New prices' success depends on downstream price transmission [40] - The supply and demand of industrial silicon depend on production cuts. Current production cuts may not reverse inventory build - up [44] - The lithium carbonate market has short - term bullish sentiment, but prices may correct after production resumes. In the long - term, consider buying on dips [46] - Geopolitical risks support the copper price, but short - term fundamentals are weakening, and the price is expected to oscillate at a high level [50] - The nickel market has uncertainties in RKAB and cobalt pricing. Consider mid - term long positions on dips under certain conditions [56] - Geopolitical conflicts have increased the risk premium of crude oil, but floating crude oil is a bearish factor [59] - The asphalt market has seen inventory build - up, and short - term prices are expected to be stable at the bottom [61] - The PTA market is rising due to expectations of inventory reduction, but there are differences between the industrial and financial sectors, and attention should be paid to downstream negative feedback [64] - The urea market's 01 contract is expected to oscillate, and the 05 contract should focus on spring - farming restocking and new export quota policies [67] - The styrene market is in an oscillatory pattern, and the key lies in the pure benzene segment. Look for low - buying opportunities in the medium - term [70] - The caustic soda market's supply - demand contradictions have eased, and a decline in liquid chlorine prices may support the price [72] - The PVC market is in the bottom range, with short - term supply - demand contradictions difficult to resolve. In 2026, supply - demand may improve [74] 3. Summaries by Directory 3.1 Financial News and Comments 3.1.1 Macro Strategy (Foreign Exchange Futures - US Dollar Index) - Trump will soon nominate a new Fed Chairman, which will increase market risk appetite and lead to a decline in the US Dollar Index [12] - Trump will launch a "ground" crackdown on drug - trafficking, and US officials have held constructive talks with Ukraine and European representatives [11] 3.1.2 Macro Strategy (US Stock Index Futures) - Fed official Milan believes that not cutting interest rates in 2026 will lead to a recession risk. The Fed has internal differences on interest rate cuts, and the market may re - price the long - term interest rate cut path [14] 3.1.3 Macro Strategy (Stock Index Futures) - The State Council is planning major projects. In December, LPR remained unchanged. A - shares increased in volume on December 22, and the market is in an offensive state [16][17] 3.1.4 Macro Strategy (Treasury Bond Futures) - In December, LPR remained unchanged, and the central bank conducted 67.3 billion yuan of 7 - day reverse repurchase operations, with a net withdrawal of 63.6 billion yuan. Treasury bond futures declined, but long - term varieties are bottoming out [19][20] 3.2 Commodity News and Comments 3.2.1 Black Metals (Rebar/Hot - Rolled Coil) - Magang's new galvanizing line project was successfully commissioned. 242 steel enterprises have completed the ultra - low emission transformation. Steel prices are oscillating strongly, and short - term supply - demand contradictions are not prominent [23][24] 3.2.2 Agricultural Products (Soybean Meal) - Last week, the inventory of soybeans in major domestic oil mills decreased, while the inventory of soybean meal increased. The supply of imported soybeans is sufficient, the market lacks bullish factors, and soybean meal is expected to remain weak [26] 3.2.3 Black Metals (Coking Coal/Coke) - Coking coal prices in Changzhi are fluctuating. Coking coal and coke are in a state of weak supply and demand. Pay attention to downstream restocking and future supply - demand changes [27][28] 3.2.4 Non - Ferrous Metals (Lead) - The government has cracked down on illegal mining. In November 2025, China's lead - acid battery exports decreased. The Shanghai Futures Exchange will waive multiple trading fees in 2026. The lead market is in a state of weak supply and demand, and prices are likely to oscillate [30][31][33] 3.2.5 Non - Ferrous Metals (Zinc) - The Shanghai Futures Exchange will waive multiple trading fees in 2026. In November 2025, zinc concentrate imports increased, and galvanized sheet exports decreased month - on - month. The short - term fundamentals of zinc have few contradictions, and prices are likely to rise in the medium - term [34][35][37] 3.2.6 Non - Ferrous Metals (Polysilicon) - The Guangzhou Futures Exchange has adjusted the designated delivery warehouses and quality inspection institutions for polysilicon futures. The polysilicon market has a problem of inventory build - up and weak demand. New prices' success depends on downstream price transmission [38][40] 3.2.7 Non - Ferrous Metals (Industrial Silicon) - In November 2025, China exported 54,888.405 tons of industrial silicon. The supply and demand of industrial silicon depend on production cuts. Current production cuts may not reverse inventory build - up [44] 3.2.8 Non - Ferrous Metals (Lithium Carbonate) - In November 2025, China's lithium spodumene imports reached a record high. The lithium carbonate market has short - term bullish sentiment, but prices may correct after production resumes. In the long - term, consider buying on dips [46] 3.2.9 Non - Ferrous Metals (Copper) - BHP will focus on Canadian copper mining. In November 2025, China's copper ore concentrate imports increased, and refined copper imports decreased. Geopolitical risks support the copper price, but short - term fundamentals are weakening, and the price is expected to oscillate at a high level [48][49][50] 3.2.10 Non - Ferrous Metals (Nickel) - Vale Indonesia says the reduction in RKAB will not affect next year's production. The nickel market has uncertainties in RKAB and cobalt pricing. Consider mid - term long positions on dips under certain conditions [52][56] 3.2.11 Energy and Chemicals (Crude Oil) - The arrival volume of crude oil in Shandong exceeded 2.6 million tons. Geopolitical conflicts have increased the risk premium of crude oil, but floating crude oil is a bearish factor [57][59] 3.2.12 Energy and Chemicals (Asphalt) - Asphalt refinery and social inventories have increased. Short - term prices are expected to be stable at the bottom [61] 3.2.13 Energy and Chemicals (PTA) - On December 22, the PX price rose. The PTA market is rising due to expectations of inventory reduction, but there are differences between the industrial and financial sectors, and attention should be paid to downstream negative feedback [63][64] 3.2.14 Energy and Chemicals (Urea) - The weekly operating rate of compound fertilizers decreased. The 01 contract of urea is expected to oscillate, and the 05 contract should focus on spring - farming restocking and new export quota policies [66][67] 3.2.15 Energy and Chemicals (Styrene) - The inventory of styrene in East China ports increased. The styrene market is in an oscillatory pattern, and the key lies in the pure benzene segment. Look for low - buying opportunities in the medium - term [68][70] 3.2.16 Energy and Chemicals (Caustic Soda) - The caustic soda market in Shandong is stable. The supply - demand contradictions have eased, and a decline in liquid chlorine prices may support the price [71][72] 3.2.17 Energy and Chemicals (PVC) - The price of PVC powder in the domestic market has declined. The PVC market is in the bottom range, with short - term supply - demand contradictions difficult to resolve. In 2026, supply - demand may improve [73][74]

1. Report Industry Investment Rating - The investment rating for rebar and hot-rolled coil is "oscillation" [1] 2. Core Viewpoints of the Report - In a neutral scenario, the terminal demand for steel in 2026 is expected to be roughly flat year-on-year. Domestic demand will see limited changes, while external demand will remain a significant driver. The supply-side regulation, especially capacity reduction, will be a long-term task. Steel prices may gradually bottom out through oscillations in 2026, but the upward space and elasticity are still insufficient. The main operating ranges for rebar and hot-rolled coil主力 contracts are estimated to be 2950 - 3400 yuan/ton and 3050 - 3550 yuan/ton respectively. There are still risks of market decline in the first half of the year [1][3][143] 3. Summary by Directory 3.1 2025 Steel Market Review: Center of Gravity Moved Down, Narrow Oscillation - In 2025, steel prices showed a narrow oscillation pattern with a reduced fluctuation range and significantly lower volatility compared to the previous two years. The price center of gravity declined, but the downward trend was not smooth. In the first half of the year, steel prices oscillated downward due to factors such as US reciprocal tariffs and a significant weakening of coal and coke costs. Starting from late June, steel prices rebounded rapidly in a short period driven by low inventory support and "anti-involution" policy expectations. However, due to the suppression of real demand and the weakening of export orders, the price was under obvious upward pressure. After late July, steel prices gradually entered a stage of oscillatory decline, and the entire fourth quarter was almost in a state of narrow-range fluctuation [16] - The core reasons for the decline in volatility are twofold: 1) The increase in the weight of external demand led to a significant compression of the upward and downward space of steel prices. The increase in external demand and manufacturing demand provided a more solid cost support, and exports also provided a more obvious bottom support when domestic steel prices fell. However, when domestic prices rose to a level where export order-taking willingness weakened, it also formed an obvious upward pressure. 2) The overall supply-demand expectation gap in the market was not prominent. Although the reciprocal tariffs and "anti-involution" policies in the second and third quarters led to obvious changes in market expectations, they had limited impact on real supply and demand, making it difficult for the market to continuously trade on the changes at the expectation level [17] 3.2 Demand: Domestic Demand Calm, External Demand Still Supportive 3.2.1 Domestic Incremental Policy Expectations Insufficient, Supply-side Policies May Strengthen - The 2025 Central Economic Work Conference indicated that with the decline of external risks, the need to introduce incremental policies to hedge against the decline of external demand has decreased. The conference more clearly pointed out the contradiction of "strong supply and weak demand" in the domestic market and emphasized "optimizing supply", suggesting that policies will strengthen efforts on the supply side in 2026 and significantly speed up the construction of a unified national market [31] - In terms of fiscal and monetary policies, the 2026 fiscal policy and infrastructure investment will be relatively conservative. Monetary policy will focus on promoting a moderate rebound in inflation. The policy on "two new" and "two important" areas will shift from "strengthening" to "optimizing", and the real estate market will continue the tone of "supporting without boosting" [32] 3.2.2 Building Material Demand Hard to Improve, Focus on Fund Allocation Rhythm - In 2025, the real estate demand continued to be weak, and the decline in sales widened again. In 2026, the decline in real estate sales may continue, and the front-end investment is expected to continue to decline significantly, which will continue to drag down the steel demand [36][37] - In 2026, the expectation for infrastructure demand is not optimistic. In 2025, the fixed asset investment growth rate of traditional infrastructure declined significantly, mainly due to tight funds. In 2026, the fiscal policy will focus on structural optimization, and the scale of investment in traditional infrastructure is expected to be limited [46][47] 3.2.3 Manufacturing Demand Maintains Resilience, but Growth Rate Still at Risk of Decline - In 2025, the strong manufacturing demand was an important factor supporting the terminal demand for steel. The manufacturing PMI showed a pattern of strong supply and weak demand. The "two new" related replacement demand and strong exports were important factors supporting the steel demand in the manufacturing industry. However, there were no obvious signs of entering the replenishment cycle [59] - In 2026, the steel demand in the manufacturing industry is expected to continue to grow, but the overall growth rate may decline significantly compared to 2025. The "two new" policies will focus on optimization, and the incremental funds are not clear. The demand driven by "replacing the old with the new" may face problems such as demand front-loading and marginal decline in subsidy effects [59] - In 2026, the external demand for manufacturing terminals is expected to remain strong. In 2025, despite the impact of Sino-US trade frictions, the exports of core manufacturing terminal products continued to rise. With the progress of Sino-US trade negotiations and the increase in demand from emerging markets, indirect exports are expected to continue to be an important driving force for steel demand in 2026 [73] 3.2.4 Direct Exports: Impact of License System to be Observed, Medium and Long-term Outlook Depends on Overseas Demand - Since January 1, 2026, the export license management system for some steel products will be implemented, which may impose certain policy constraints on the compliance of export entities, the variety structure, and quality of exported steel. However, the specific implementation scale and license issuance situation still need to be observed [88] - In 2025, the direct exports of steel and semi-finished products showed an obvious characteristic of "trading volume at the expense of price", and the net export volume is expected to reach about 125 million tons. The export variety and destination structures have changed significantly. Overseas trade frictions continue to increase, and the pressure from EU carbon tariffs and overseas anti-dumping in 2026 remains high [89][90] - In the medium and long term, the key factors affecting steel exports are the strength of overseas demand and the speed of overseas steel supply increase. Based on the forecast of the World Steel Association, the global crude steel demand will continue to increase slightly by about 1% in 2026. Although the overall scale of steel exports in 2026 is not expected to be pessimistic, the export in the first half of the year may be suppressed if the regional price difference cannot be widened [105] 3.3 Supply: "Anti-involution" Policy Still Unclear, Cost-based Pricing Pattern Remains 3.3.1 Implementation of Steel Industry "Anti-involution" Expected to be a Long-term Process - The market has high expectations for the "anti-involution" policy in the steel industry, mainly due to the long-term low profitability of the steel industry and the need to stabilize the prices of upstream and midstream products in the black industry chain to prevent the decline of PPI [110] - The implementation of supply-side policies in the steel industry is difficult to be as rapid and drastic as in the 2016 cycle. Possible directions for capacity reduction in the future include the full completion of ultra-low emission transformation and the verification of steel production capacity and overproduction control similar to that in the coal industry. However, there are still many uncertainties and difficulties in implementation [111][112] - In 2026, the market is expected to trade the change in production volume from a more market-oriented rather than administrative perspective. The decline in production volume is more likely to be due to terminal demand factors, and the improvement of steel mill profits requires substantial capacity compression [113] 3.3.2 Driving Force for Steel Mill Profit Improvement Still Depends on Capacity Reduction - Under the neutral scenario, the profit improvement space for steel products in 2026 will still be limited, and the industry will generally remain around the break-even point. In 2025, the profit of steel mills showed a pattern of initial improvement and then compression, and the electric furnace was in a loss state for most of the time [121] - In 2026, it is still difficult to provide profits for all production capacities. The marginal supply will mostly be in a loss state, and the gross profit of blast furnaces in the low-cost area will be difficult to break through the 200 yuan/ton range. The substantial reduction of production capacity is the key to breaking through the profit center and space [122] 3.3.3 Steel Price Valuation Still Anchored to Cost, Market Contradiction Focuses on Coils - In 2026, the overall steel price valuation is expected to continue to be anchored to the cost. The increase in iron ore supply is at risk, but the cost center may not move down significantly. The coking coal price is unlikely to fall below the 2025 low. The steel price is expected to be difficult to fall below the 2025 low without a significant weakening of demand. The upward movement of steel prices will be restricted by the inability to provide profits for all production capacities and the export order situation [132] - For the steel price valuation to break through upward in 2026, two conditions are required: the substantial implementation of the "anti-involution" policy in the domestic steel industry and the improvement of real demand driven by overseas loose monetary and fiscal policies with smooth price and cost transmission [132] - Since the second half of 2024, the actual supply of building materials has decreased significantly, and the rebar inventory level has dropped significantly. In 2026, this situation is expected to continue, and rebar may be in a relatively tight state periodically. Currently, the inventory of coils and non-five major varieties is relatively high and the de-stocking is slow. Therefore, attention should be paid to the potential supply pressure and contradiction of coils and non-five major steel products in 2026 [133][140] 3.4 2026 Steel Supply and Demand Outlook and Market Trading Logic - Under the neutral scenario, the supply and demand contradiction in the steel market in 2026 is still not prominent. The accelerated release of overseas liquidity is one of the most important macro logics, which is expected to push up inflation, but the boost to real demand and the smoothness of price transmission need to be observed. The domestic demand will see limited substantial changes, and the supply-side regulation related to "anti-involution" will be a relatively long-term task. The steel price may gradually bottom out through oscillations in 2026, but the upward space and elasticity are still insufficient [143] - In the first half of 2026, the market still faces downward risks. The actual implementation of the steel export license management system is yet to be confirmed, and the real demand in spring is expected to be weak. Attention should be paid to the inventory risk in spring. In the second half of 2026, the probability of inflation rising and domestic incremental policy implementation will increase, and the "anti-involution" policy path may become clearer, which may drive up the steel price and profit [144]

1. Report Industry Investment Rating | Asset Category | Rating | | --- | --- | | Gold | Oscillation | | US Dollar | Bearish | | US Stocks | Oscillation | | A-Shares | Oscillation | | Treasury Bonds | Oscillation | [22] 2. Core Viewpoints of the Report - The US employment market continues to cool, inflation eases, and the Fed's policy focus remains on employment with future rate cuts as the baseline. Market expects a likely pause in rate cuts in January, and the new Fed Chair selection may reshape the rate cut path. Japan's central bank hiked rates, and overseas risk appetite rebounded. China's November economic data was weak, but the entry of state - owned funds boosted A - share confidence [4]. - Global commodity markets rebounded, with energy prices weakening and metals performing strongly. China's domestic commodity market sentiment improved [20]. - Different asset classes are expected to show oscillatory trends in the short - term, with the bond market likely to recover moderately [22]. 3. Summaries According to the Table of Contents 3.1 Macro Context Tracking - US: Non - farm data was mixed, employment cooled, CPI dropped unexpectedly, and the Fed's policy leans towards rate cuts. The new Fed Chair selection is pending, and candidates support significant rate cuts. - Japan: The central bank hiked rates by 25bp, but the stance was less hawkish than expected. - China: November economic data declined, with supply - demand imbalance. However, state - owned funds entered the market, boosting A - share confidence [4]. 3.2 Global Asset Class Performance Overview 3.2.1 Equity Markets - Most global stock markets corrected. Developed markets: S&P 500 rose 0.1%, Nikkei 225 fell 2.61%, etc. Emerging markets: Shanghai Composite Index fell 0.03%, Hang Seng Index fell 1.1%, etc. MSCI indices showed different trends, with frontier > developed > global > emerging [6][8]. 3.2.2 Foreign Exchange Markets - The US dollar index oscillated, appreciating 0.32%. The RMB appreciated against the US dollar, while some emerging market and developed market currencies had different trends, such as the Mexican peso depreciating 0.12% and the Brazilian real depreciating 2.06% [10][12]. 3.2.3 Bond Markets - Global major countries' 10 - year government bond yields oscillated narrowly. In developed countries, US bond yields dropped 3bp to 4.16%, while in emerging markets, China's bond yields dropped 1bp to 1.83% [15][16]. 3.2.4 Commodity Markets - The global commodity market rebounded. Energy prices weakened (WTI crude oil fell 1.72%, natural gas fell 1.83%), while metals were strong (LME copper rose 2.85%, LME aluminum rose 2.43%). Gold oscillated at a high level, and silver rose strongly [19][20]. 3.3 Weekly Outlook for Asset Classes 3.3.1 Precious Metals - Gold is expected to oscillate at a high level, with attention on whether it can break through the previous high. Silver prices rose sharply, but there is a risk of decline. The gold - silver ratio dropped to 65.6 [22][23][35]. 3.3.2 US Dollar - The US dollar is bearish due to the weakening labor market and falling inflation [22][36]. 3.3.3 US Stocks - US stocks are expected to oscillate with a slightly upward trend, supported by economic data for rate cuts, alleviated AI bubble concerns, and strong year - end seasonality [22][40]. 3.3.4 A - Shares - A - shares are expected to oscillate at a high level, affected by factors such as year - end capital holding [22][50][57]. 3.3.5 Treasury Bonds - The bond market is expected to recover moderately, with improved trading structure and favorable fundamentals [58]. 3.4 Global Macroeconomic Data Tracking 3.4.1 Overseas High - Frequency Economic Data - US: GDPNow model estimated Q3 growth at 3.47%, retail sales were resilient, inflation expectations dropped, and the employment market continued to cool. Bank liquidity is expected to improve, and corporate bond credit spreads rose slightly. November non - farm data was mixed, and CPI dropped [74][82][85]. 3.4.2 Domestic High - Frequency Economic Data - Real estate transactions were weak, and market pessimism persisted. November economic data showed a weakening trend, with investment, consumption, and credit data under pressure. CPI and PPI showed a K - shaped divergence, and exports outperformed expectations [86][98][109].