Investment Rating - The industry view for China's financial sector is rated as Attractive [4] Core Insights - China's banks have sufficient capacity to absorb potential risks from increased US tariffs, with stable earnings and dividends expected to support share performance [1][12] - The potential industrial non-performing loan (NPL) ratio is forecasted to rise to 10-11% from 8.4% at the end of 2024 due to tariff impacts [15][20] - The analysis indicates that approximately 4% of total loans, primarily export-related credits, are exposed to tariff risks, with electronics and electrical equipment being the most affected sectors [10][12] Summary by Sections Financial Stability - Major Chinese banks are expected to maintain stable earnings and dividends despite potential delays in net interest margin (NIM) and fee income recovery [1][58] - The banking sector has been digesting over RMB 3 trillion of total NPLs annually, with a consistent provision charge of around RMB 1.3 trillion [18][19] Risk Assessment - The incremental NPL from higher tariffs could be 2-3% for industrial loans, translating to an increase of 40-60 basis points in total loans [7][12] - The forecast suggests that if tariffs affect one-third of export-oriented manufacturing credits, the cumulative industrial NPL ratio could reach 15-16% [20][22] Sector-Specific Insights - The electronics sector accounts for 22% of exports to the US, while apparel and furniture have higher revenue exposure, indicating varying levels of risk across sectors [10][11] - Continued capital expenditure rationalization in the industrial sector is expected to ease some risks associated with industrial loans [33][37] Market Dynamics - The ongoing tariff dynamics are anticipated to create uncertainties in the A-share market, affecting both fundamentals and investor sentiment [58] - A shift in preference back to defensive banks from insurance is noted, reflecting market volatility and the need for stable earnings [56][58]

April 21, 2025 02:24 PM GMT Investor Presentation | Asia Pacific Asia EM Equity Strategy: Asia Pacific and America First – Latest Targets & Signposts Multipolar world trends are in the ascendancy. Deal making is possible but uncertainty weighs heavily on the trade/earnings outlook. . We prefer Japan (domestic, unhedged), India, Singapore and UAE, while holding an EW stance on China. We remain UW on Taiwan and South Korea. Within ASEAN we prefer Philippines vs Indonesia. We continue to prefer Financials vs S ...

April 21, 2025 03:20 AM GMT Multi-Industry | North America Week Ahead EPS Preview + Key Macro Debates Given the fast changing + volatile macro, we are opting for "week ahead" previews this EPS season. As always, we spoke with every company in back half of March. Detailed modeling + thoughts within. We anticipate modest Q1 beats but with the world changing on April 2, outlooks will drive the equities and we expect market focus on April demand commentary and rest of year price / cost. While latest investor co ...

Key Takeaways Spot thermal coal price declined slightly: QHD 5500 was flat WoW at Rmb678/t as of April 18. CCI 5500 was down 0.3% WoW to Rmb670/t. BSPI was flat WoW at Rmb678/t. Mine-mouth prices for Shanxi Datong 5800 was down 2.3% WoW to Rmb548/t. Seaborne price declined: NEWC price fell 2.1% WoW to US$94/t as of April 18. Inventory piling at QHD port: QHD inventory increased 11.2% WoW to 6.85mt. Inventory at Bohai Rim ports decreased 0.9% WoW to 29.9mt as of April 18. Stable coking coal prices: Liulin No ...

April 21, 2025 02:52 PM GMT China Materials | Asia Pacific Weekly Monitor: Critical Minerals in the Focus More minerals under US tariff probe. Baosteel continues industry consolidation. Base metals: Shanghai copper prices were up 2.5% WoW, while inventories were down 6.2% WoW. Shanghai aluminum prices were up 1.3% WoW, while inventories were down 7.4% WoW. Key news of the week: Trump administration orders tariff probe on all US critical mineral imports. Battery metals: Domestic industrial-grade lithium hydr ...

April 21, 2025 09:10 AM GMT Morgan Stanley & Co. LLC Eli Carter Strategist Eli.Carter@morganstanley.com +1 212 761-4703 Morgan Stanley India Company Private Limited Kanishk Jain Strategist Kanishk.Jain@morganstanley.com +91 22 6293-5744 North America US Interest Rates Strategy US Liquid Rates Tracker Data Package | Contents | Page | | --- | --- | | General Market Summary Treasury | 2 | | Summary | 3 | | SOFR Futures Rolldown Report | 11 | | STRIPS | 17 | | TIPS | 21 | For important disclosures, refer to the ...

April 21, 2025 04:01 AM GMT US Equity Strategy | North America Weekly Warm-up: Range Trading Continues Until Clarity Arrives The S&P remains in the middle of our 5000-5500 trading range. Dispersion of EPS revisions is picking up, a sign that reporting season is likely more of a rotational driver. We recommend looking for quality stocks in industries where the set up is more de-risked and offer tools for idea generation. M Idea Morgan Stanley & Co. LLC Michael J Wilson Equity Strategist M.Wilson@morganstanle ...

Aier Eye - A Leading the ophthalmic track and awaiting a recovery in demand; initiate at N We initiate coverage of Aier Eye with a N rating and a Dec-25 PT of Rmb13. Aier Eye is the leader in the structurally expanding ophthalmology market underpinned by an ageing population and escalating 'quality of life' requirements. Resilient demand for cataract and eye disease therapy ensures steady industry growth, even if the lukewarm consumer economy in China is delaying discretionary ophthalmic demand. Aier's firs ...

大华股份 - A 我们更新模型以反映 2025 年 1 季度的实际财务数据，并维持我们 2025-27 年预测基本不变。由于需求前景疲软且竞争加剧，我们维 持"中性"评级；我们截至 2026 年 6 月的目标价为 17.5 元，基于 12 倍的一年动态市盈率得出。 中国 证券研究 2025 年 4 月 22 日 中性 002236.SZ, 002236 CH 模型更新 股价（2025 年 4 月 21 日）： 15.79 元 目标价（2026 年 6 月）： 17.50 元 证券研究报告 科技 证券分析师: 冯令天 AC (86-21) 6106 6359 billy.feng@jpmorgan.com 登记编号: S1730520030005 证券分析师: 许日 (86-21) 6106 6318 ri.xu@jpmchase.com 登记编号: S1730522100001 证券分析师: 刘叶 (86-21) 6106-6200 ye.liu@jpmorgan.com 登记编号: S1730521090001 摩根大通证券（中国）有限公司 重要变更（财年12月份结束） | | 旧 | 新 | | --- ...

April 21, 2025 11:41 PM GMT Asia Technology | Asia Pacific M Foundation Tuesday TMT: TSMC, Tariff Impact on Technology, and Japan SPE Join our Technology analysts Shawn Kim, Charlie Chan, Tetsuya Wadaki, and Derrick Yang as they discuss TSMC's takeaways post results, further potential tariff impacts on Technology, and Japan semicap equipment updates. | Morgan Stanley Asia Limited+ | | | --- | --- | | Shawn Kim | | | Equity Analyst | | | Shawn.Kim@morganstanley.com | +852 3963-1005 | | Morgan Stanley Taiwan ...