Investment Rating - The report maintains a rating of "Outperform" for the industry [5] Core Insights - Nvidia has announced a strategic investment of $4 billion in the optical communication industry, partnering with Lumentum and Coherent [9][14] - Broadcom has launched the first single-channel 400G DSP, optimized for 1.6T transceiver solutions, addressing the growing bandwidth demands of AI data centers [9][16] Market Review - The overall communication industry has seen a decline, with the communication index down 0.7% over the past two weeks, ranking 10th among 31 sectors [2][19] - The valuation level of the communication sector is relatively high, with a dynamic PE ratio of approximately 52.77 as of March 13, 2026, compared to a historical average of 32.51 [2][23] - In terms of sub-sectors, operators, submarine cables, and North American AI sectors have shown the highest growth rates of 5.9%, 3.8%, and 1.2% respectively [2][26] - Among individual stocks, 38 out of 128 in the communication sector rose, with notable gains from Ruisi Kanda (32.5%), Lian Te Technology (20.7%), and others [2][27] Configuration Recommendations - The report suggests focusing on the core segments of the computing power industry chain, including new technology penetration and the improvement of domestic supply chains. Key areas of interest include optical modules, copper interconnects, switches, temperature control equipment, power supply, IDC rooms, edge AI, robotics, operators, and satellite communications [3][34]

Financing Data - In February 2026, the domestic social financing scale increased by 23,792 billion yuan, a year-on-year change of +1,461 billion yuan[1] - The new RMB loans amounted to 8,484 billion yuan, with a year-on-year increase of +1,956 billion yuan[5] - The total social financing stock grew by 8.2% year-on-year, with no change from the previous month[6] Loan and Deposit Trends - The increase in fiscal deposits decreased month-on-month, indicating a stronger push in fiscal policy[10] - New loans to non-financial companies and other sectors reached 14,900 billion yuan, a year-on-year increase of +4,500 billion yuan[12] - Resident short-term and medium-to-long-term loans showed negative growth, indicating a need to boost consumer demand[14] Monetary Supply - M2 grew by 9.0% year-on-year, while M1 increased by 5.9%, with the M2-M1 gap narrowing to 3.1 percentage points[15] - The central bank is expected to adjust monetary policy, focusing less on quantity targets and more on interest rate guidance[17] Interest Rate Outlook - Short-term government bond yields are nearing the lower limit of the interest rate corridor, indicating downward pressure on rates[18] - The expectation for interest rate cuts remains, supported by recent statements from the central bank regarding the flexibility of monetary policy tools[18]

Group 1: Macro Strategy - The "15th Five-Year Plan" emphasizes a shift from "passive adaptation" to "active shaping" of global strategies, acknowledging the coexistence of strategic opportunities and risks[6] - The development environment is characterized by profound and complex changes, with increased consideration of external risks and challenges[6] - The focus has shifted from "emphasizing speed" to "paying attention to quality," with high-quality development prioritized over mere economic growth[8] Group 2: Economic Goals - The GDP growth target for 2026 is set at a flexible range of 4.5% to 5%, allowing for structural adjustments and risk prevention[9] - The plan aims for a per capita GDP to double by 2035, indicating a long-term growth trajectory[9] - The urbanization rate for permanent residents is targeted to reach 71% by 2026, up from 65% in the previous plan[11] Group 3: Investment and Consumption - Investment will focus on efficiency, with an emphasis on "two heavy" investments, consumer-related investments, and government investments in livelihood[23] - The plan highlights the importance of boosting consumption, particularly in service sectors such as elderly care, childcare, and education[22] - The government aims to increase the proportion of social investment in human resources, reflecting a shift from "serving people" to "investing in people"[24] Group 4: Technological and Industrial Development - The focus has shifted from "technological self-reliance" to "industry leadership," with an emphasis on the industrialization of technological achievements[12] - The plan outlines specific tasks for enhancing capabilities in high-end materials, basic components, and industrial software[15] - New industries are prioritized for development, including integrated circuits, bio-manufacturing, and green hydrogen, with a focus on application scenarios and ecosystem building[16]

1. Report Industry Investment Rating No information provided in the given content. 2. Core Viewpoints of the Report - The real - estate high - frequency data shows a marginal improvement, but its sustainability needs further observation. The performance of the real - estate market in first - tier cities is remarkable, and attention should be paid to the "small spring" of the real - estate market in March [2][8]. - The resumption of work and production rate of national construction sites is lower than that of the same lunar period last year. The production of the construction industry is weak, while the manufacturing industry provides some support for industrial production. Attention should be paid to the recovery of industrial production in North China after the influence of weather factors fades [2][9]. - The international crude oil market is in a volatile state. Geopolitical factors significantly affect oil prices. The release of strategic oil reserves by multiple countries may impact the oil price, and the future development of the Middle East situation also needs attention [2][10]. 3. Summaries According to the Directory 3.1 Financial Market - Interest rate and credit bond indices show differentiated performance, and the Nanhua Energy and Chemical Index rises [11][13]. - The gold - copper ratio shows a marginal increase, and the gold - silver ratio decreases. The gold price rises marginally, and the silver price first rises and then falls [14]. 3.2 Industrial Production 3.2.1 Power Generation - The coal consumption of power plants in eight southern provinces decreases, and the price of thermal coal shows a marginal decline [16][17]. 3.2.2 Coking - The operating rate of coking enterprises rises marginally, and the prices of coking coal and coke futures increase [18]. 3.2.3 Steel - The output of rebar increases, and the arrival volume of iron ore at six northern ports rises significantly. The prices of iron ore futures and spot increase, and the rebar futures price also goes up [20][21][23]. 3.2.4 Building Materials - The capacity utilization rate of cement clinker continues to rise, and the accumulation rate of copper and aluminum inventories slows down. The price of glass rises, while the national cement price index shows a marginal decline [25][26][28]. 3.2.5 Chemical Industry - Most of the operating rate data shows an upward trend, and the crude oil price continues to rise significantly. The methanol operating rate continues to decline, while the soda ash operating rate rises marginally [38]. 3.2.6 Automobile - The operating rates of automobile semi - steel tires and all - steel tires increase slightly [39][40]. 3.3 Resumption of Work and Production - The resumption of work and production progress of 10,692 national construction sites is lower than that of the same lunar period last year, and the resumption of non - real - estate projects is better than that of real - estate projects [41][42]. 3.4 Logistics and Transportation 3.4.1 Freight - The road logistics freight rate index remains stable, and the railway freight volume continues to rise [42][43]. 3.4.2 Passenger Transport - The subway passenger volume fluctuates within a narrow range, and the number of domestic and international flights drops significantly [45]. 3.5 Terminal Demand 3.5.1 Credit - The negative spread between bill rediscount and certificate of deposit narrows, and the rediscount rate of six - month national - owned enterprise bills rises marginally [46][48][51]. 3.5.2 Real Estate - The transaction area of new houses fluctuates upward, and the sales area of second - hand houses in Beijing, Shanghai, and Shenzhen rebounds significantly. The land transaction area of 100 cities rises marginally, while the land premium rate drops significantly [52][53][66]. 3.5.3 Construction - The apparent demand for rebar rebounds significantly, and the proportion of profitable steel mills turns from a decline to an increase [66][67]. 3.5.4 Consumption - The total number of movie screenings decreases seasonally, and the vegetable price continues to fall [67][75][76]. 3.5.5 Export - The SCFI freight rate rises, and the port container throughput continues to recover. The CCFI index of the Persian Gulf - Red Sea route rises significantly month - on - month, while the Baltic Dry Index fluctuates downward [79][84][86].

Group 1: Economic Growth - The economic growth target for 2026 is set in the range of 4.5%-5%, marking the first time it has fallen below 5% since the reform and opening up, allowing for structural reforms and risk management [8][9] - Historically, growth targets are often set close to the lower limit, indicating a "bottom line" approach, with 4.5% as the minimum and 5% as the aspirational target for 2026 [9][11] - The nominal GDP growth rate is expected to correlate with a long-term government bond yield of around 2%, given the historical relationship between nominal GDP growth and bond yields [12][11] Group 2: Fiscal Policy - The fiscal policy for 2026 is characterized by a stable overall approach with structural optimization, maintaining a narrow deficit rate of around 4% while slightly reducing the broad deficit rate [21][22] - The total deficit is projected at 5.89 trillion yuan, with a central deficit increase of 230 billion yuan, while local deficits remain unchanged at 800 billion yuan [22][25] - The focus of fiscal policy is shifting from total expansion to improving fund efficiency and controlling the pace of spending, emphasizing support for major projects and resolving local debt issues [22][26] Group 3: Monetary Policy - The monetary policy for 2026 continues to maintain a moderately loose stance, with a dual focus on stabilizing growth and promoting reasonable price recovery [37][38] - The approach to monetary tools is expected to be more flexible and efficient, with potential for one interest rate cut and 1-2 reserve requirement ratio reductions throughout the year [38][39] - The support for key sectors has shifted from asset price stabilization to enhancing demand in the real economy, particularly focusing on expanding domestic demand, technological innovation, and support for small and medium enterprises [41][39] Group 4: Bond Market Insights - Recent trends in the bond market indicate a warming, with yields generally declining, particularly in the short term, while the curve steepens [48][50] - The bond market's performance is influenced by geopolitical tensions and economic growth targets, with a notable reaction to the government's work report [48][49] - The current yield levels suggest a cautious approach to investment, as the attractiveness of yields below 1.8% may not be sufficient given the expectations of future economic conditions [51][49]

1. Report Industry Investment Rating There is no mention of the industry investment rating in the provided report. 2. Core Viewpoint of the Report - This week (March 9 - March 13), credit bond yields declined, but the repair amplitude was smaller than that of interest - rate bonds, and credit spreads widened passively. The February inflation and January - February import and export data released this week disturbed market expectations. Due to the rebound in February CPI and January - February import and export data, market concerns about inflation pressure increased, and bond market sentiment weakened temporarily. Meanwhile, the overall capital environment was stable, the fluctuation of money market interest rates was limited, which provided a certain buffer for the bond market. The equity market is still in a volatile range, and the overall risk preference has not changed much, so its impact on the bond market is relatively limited [2][11]. - Currently, the yield curve forms a relatively obvious convex point around the 4 - year term. Institutions with relatively stable liability ends can pay attention to the riding value of 4 - year bonds. In the scenario where the yield curve rises by 20BP, 4 - year AA - rated medium - short notes, 4 - year AA and AA(2) - rated urban investment bonds, and 4 - year AAA - and AA + - rated bank perpetual bonds are expected to maintain positive returns or only have small drawdowns during the holding period, with relatively strong anti - volatility ability. For 7 - year urban investment bonds, caution should be exercised, and for 7 - year secondary perpetual bonds, allocation - type funds can choose the opportunity to layout after market adjustments [13][14]. - The issuance of secondary capital bonds and perpetual bonds has obvious seasonal characteristics. Although there is still a high maturity and redemption scale of secondary perpetual bonds this year, and the renewal demand still exists, in the context of the continuous expansion of capital replenishment channels, commercial banks' dependence on secondary perpetual bonds has decreased, and the overall future supply scale may decline [17][18]. 3. Summary According to the Directory 3.1. Focus on Convex Point Riding, and the Supply of Secondary Perpetual Bonds May Decline - Market situation: This week, credit bond yields declined, but the repair amplitude was smaller than that of interest - rate bonds, and credit spreads widened passively. The February inflation and January - February import and export data disturbed market expectations, and bond market sentiment weakened temporarily. The equity market was in a volatile range, and its impact on the bond market was relatively limited [2][11]. - Investment strategy: The current yield curve forms a convex point around the 4 - year term. In the case of a 3 - month holding period and the curve shape remaining unchanged, the holding - period returns of 4 - year bonds are generally higher than those of 5 - year bonds of the same rating. Institutions with relatively stable liability ends can pay attention to their riding value. In the scenario where the yield curve rises by 20BP, 4 - year AA - rated medium - short notes, 4 - year AA and AA(2) - rated urban investment bonds, and 4 - year AAA - and AA + - rated bank perpetual bonds have relatively strong anti - volatility ability. For 7 - year urban investment bonds, caution should be exercised, and for 7 - year secondary perpetual bonds, allocation - type funds can choose the opportunity to layout after market adjustments [13][14]. - Supply situation: The issuance of secondary capital bonds and perpetual bonds has obvious seasonal characteristics. This year, secondary perpetual bonds are still in a peak maturity stage, with an expected annual maturity and redemption scale of about 1.18 trillion yuan, and banks still have a certain renewal demand. However, in the long - term, the net financing scale of secondary perpetual bonds has been declining in recent years. With the diversification of bank capital replenishment channels, the dependence of commercial banks on secondary perpetual bonds has decreased, and the future supply scale may decline [17][18]. 3.2. Review of the Quantity and Price of Inter - bank Liquidity - This week (March 9 - March 13), the volume of the inter - bank pledged repurchase market decreased and the price increased. The median daily trading volume of inter - bank pledged repurchase was 8.51 trillion yuan, a decrease of 260.2 billion yuan from last week, and the trading volume was in the top 2.9% of the range since 2020. The median R001 was 1.39%, an increase of 4bp from last week, and the repurchase interest rate was in the bottom 21% of the range since 2020. The median spread between R001 and DR001 was 6.7bp, a decrease of 0.6bp from last week; the median spread between GC001 and R001 was 11.0bp, an increase of 20.3bp from last week, and the exchange financing cost was higher than that of the inter - bank [38][40]. - In terms of interest rate swaps, the 1 - year FR007 IRS interest rate increased this week. The median 1 - year FR007 IRS was 1.50%, an increase of 2.1bp from last week, and the interest rate was in the bottom 5% of the range since 2020. The median 1 - year SHIBOR 3 - month IRS was 1.56%, and the interest rate was in the bottom 4% of the range since 2020 [43]. 3.3. Review of the Inter - bank Certificate of Deposit Market - On March 13, SHIBOR overnight, 7 - day, 1 - month, 3 - month, 6 - month, 9 - month, and 1 - year quotes were 1.32%, 1.46%, 1.53%, 1.54%, 1.56%, 1.57%, and 1.58% respectively. Compared with March 6, the overnight and above - term quotes changed by 0bp, 5bp, - 1bp, - 1bp, - 1bp, - 1bp, - 1bp respectively. The yields to maturity of 1 - month, 3 - month, 6 - month, 9 - month, and 1 - year inter - bank certificates of deposit of AAA - rated commercial banks were 1.5%, 1.5%, 1.51%, 1.52%, 1.53% respectively. Compared with March 6, the 1 - month and above - term yields changed by 1bp, 0bp, - 1bp, - 1bp, - 2bp respectively [44]. - This week, the total primary issuance volume of inter - bank certificates of deposit was 842.5 billion yuan (excluding those whose actual raised amounts have not been disclosed as of March 13), an increase of 125.2 billion yuan from last week. In terms of issuance terms, the proportions of 6 - month and 9 - month terms increased, while the proportions of 1 - month, 3 - month, and 1 - year terms decreased [48]. - On March 13, the 1 - year FR007 IRS interest rate was 1.50%, an increase of 3.11bp from last week. The yield of 1 - year AAA - rated inter - bank certificates of deposit decreased by 1.75bp from last week, and the spread between the two was 3bp, a narrowing of 5bp from last week [50]. 3.4. Credit Bond Issuance Situation 3.4.1. Issuance Volume and Net Financing - This week (March 9 - March 13), the supply of credit bonds increased both month - on - month and year - on - year. The issuance of credit bonds was 350.333 billion yuan, a month - on - month increase of 18.21% and an increase of 96.211 billion yuan compared with the same period last year. The net financing of credit bonds decreased by 36.707 billion yuan month - on - month and increased by 61.262 billion yuan year - on - year. In terms of types, the net financing of urban investment bonds, industrial bonds, and financial bonds decreased by 43.783 billion yuan, 21.115 billion yuan, and increased by 28.190 billion yuan respectively month - on - month [55]. 3.4.2. Issuance Cost - The average issuance interest rate of credit bonds decreased this week. The average issuance interest rate of credit bonds was 2.81%, a decrease of 6bp from last week. In terms of types, the average issuance interest rates of industrial bonds, urban investment bonds, and financial bonds decreased by 13bp, 6bp, and increased by 2bp respectively month - on - month; in terms of ratings, the average issuance interest rates of AA, AA +, and AAA decreased by 16bp, 2bp, and 11bp respectively month - on - month [66]. 3.4.3. Issuance Term - The average issuance term of credit bonds increased this week. The average issuance term of credit bonds was 2.97 years, an increase of 0.02 years from last week. In terms of types, the issuance terms of industrial bonds, urban investment bonds, and financial bonds increased by 0.29 years, decreased by 0.46 years, and increased by 0.24 years respectively month - on - month [68]. 3.4.4. Cancellation of Issuance - This week, the number of cancelled credit bond issuances was the same as last week, and the scale decreased. A total of 12 credit bonds were cancelled for issuance, the same as last week, and the total cancelled issuance scale was 7.5 billion yuan, a decrease of 0.46 billion yuan from last week [69]. 3.5. Credit Bond Transaction and Valuation Situation 3.5.1. Transaction Volume - This week (March 9 - March 13), the total transaction volume of credit bonds was 1,435 billion yuan, a decrease of 1.3 billion yuan from last week. In terms of categories, commercial bank bonds and non - bank financial bonds in financial bonds traded 455.4 billion yuan and 90 billion yuan respectively. Medium - term notes, short - term financing bills, directional instruments, enterprise bonds, and corporate bonds traded 333 billion yuan, 122.2 billion yuan, 55.4 billion yuan, 18.4 billion yuan, and 360.8 billion yuan respectively. Compared with last week, the trading volumes of various varieties showed mixed trends. The trading volume of urban investment bonds decreased the most, by 15.8 billion yuan. The trading volume of industrial bonds decreased by 10.3 billion yuan, while the trading volumes of bank perpetual bonds and bank secondary capital bonds increased by 7.6 billion yuan and 7.4 billion yuan respectively; the trading volumes of securities firm sub - bonds and insurance sub - bonds decreased slightly by 1.1 billion yuan and 0.3 billion yuan respectively [74]. - In terms of remaining terms, the transaction term structure of urban investment bonds shifted to the medium - long term, the proportion of transactions within 1 year decreased by 4.58pct, while the proportions of 1 - 2 years, 2 - 3 years, 3 - 5 years, and over 5 years increased by 0.83pct, 2.69pct, 0.18pct, and 0.88pct respectively; the term structure of industrial bonds concentrated on 1 - 3 years, the proportion within 1 year decreased by 1.10pct, the proportion of 1 - 2 years increased by 2.93pct, the proportion of 2 - 3 years increased by 0.13pct, the proportion of 3 - 5 years decreased by 1.44pct, and the proportion of over 5 years decreased by 0.51pct; the term structure of bank secondary capital bonds was generally stable, the proportion within 1 year increased by 0.04pct, the proportion of 1 - 2 years decreased by 0.15pct, and the proportion of over 5 years increased by 0.11pct; the term of bank perpetual bonds shifted to the short - end, the proportion within 1 year increased by 3.05pct, the proportion of 1 - 2 years increased by 0.49pct, the proportion of 2 - 3 years increased by 1.72pct, and the proportion of 3 - 5 years decreased by 5.25pct; the term structure of securities firm sub - bonds concentrated on 3 - 5 years, the proportion within 1 year increased by 1.59pct, the proportion of 1 - 2 years decreased by 5.03pct, the proportion of 2 - 3 years decreased by 9.28pct, and the proportion of 3 - 5 years increased by 12.72pct; the term of insurance sub - bonds concentrated on the short - term, the proportion within 1 year increased by 12.94pct, and the proportion of over 5 years decreased by 12.94pct [75]. - In terms of implied ratings, the rating structure of urban investment bonds concentrated on lower ratings, AAA decreased by 0.90pct, AAA - decreased by 0.01pct, AA + remained unchanged (0.00pct), AA increased by 0.14pct, AA(2) decreased by 0.06pct, and AA - increased by 0.85pct; the rating structure of industrial bonds showed differentiation, AAA increased by 1.16pct, AAA - increased by 0.34pct, AA + decreased by 2.02pct, AA increased by 1.13pct, AA(2) decreased by 0.12pct, and AA - increased by 0.12pct; the ratings of bank secondary capital bonds were differentiated, AAA - increased by 4.78pct, AA + decreased by 4.39pct, AA decreased by 0.42pct, and AA - increased by 0.06pct; the ratings of bank perpetual bonds tilted towards AAA -, the proportion of AAA remained unchanged (0.00pct), AAA - increased by 9.07pct, AA + decreased by 7.99pct, AA decreased by 2.40pct, and AA - increased by 1.10pct; the ratings of securities firm sub - bonds concentrated on AA +, AAA - decreased by 8.36pct, AA + increased by 11.03pct, AA decreased by 2.88pct, and AA - increased by 0.14pct; the proportions of various ratings of insurance sub - bonds showed differentiation, AA + increased by 3.55pct, AA increased by 11.64pct, and AA - decreased by 13.17pct [76]. 3.5.2. Spread Tracking - The yields of credit bonds showed differentiation at various levels and terms. This week, except for the yields of 5 - year bonds at all levels, 3 - year and 4 - year AAA - rated bonds, which generally increased, the others generally decreased. Among them, the yields of 1 - year bonds at all levels decreased slightly by 1.73BP. The yield of 5 - year AA - rated bonds decreased the most, by 2.15BP. The current yield percentile levels of all levels are relatively low, the percentiles of the medium - short end are generally lower than those of the long end, the 1 - year AA is at an extremely low percentile of 0.3% since 2025, the 4 - year AA yield percentile is at 24.4%, and the 5 - year AAA is at a percentile of 22.0%. - The credit spreads of 1 - year bonds at all levels, 4 - year AA + and AA - rated bonds narrowed, while the others widened. Among them, the spread of 4 - year AA - rated bonds narrowed the most, by 1.73BP, the narrowing amplitude of 1 - year bonds at all levels was 0.09BP, and the spread of 3 - year AAA - rated bonds widened by 2.48BP. In terms of spread percentiles, the spreads of all levels are generally in a relatively low range, among which the spread percentiles of 1 - year bonds at all levels are relatively low, all between 0.3% - 0.6% [79]. - The yields of urban investment bonds showed differentiation at various levels and terms. The 1 - year yields generally decreased, while the 2 - year, 4 - year, and 5 - year yields generally increased. Among them, the yields of 1 - year bonds at all levels decreased significantly, with AAA decreasing by 1.59BP, and AA + and AA decreasing by 1.58BP. The yields of 5 - year bonds at all levels increased synchronously, with AAA increasing by 0.90BP, AA + increasing by 1.60BP, and AA increasing by 0.6BP. This week, except for the yields of 2 - year, 3 - year AA, 4 - year, and 5 - year bonds at all levels, which increased, the yields of 1 - year bonds at all levels, 3 - year AAA, and 3 - year AA + at all levels decreased, and the short - end decline was relatively significant. The current yield percentile levels of all levels are relatively low, the percentiles of the medium - short term are generally lower than those of the long term, the 1 - year bonds at all levels are at an extremely low percentile of 0.3% since 2025

1. Report Industry Investment Rating No relevant content provided. 2. Core Viewpoints - The yield of the 10Y Treasury bond active bond 250016 rose 2.90BP to 1.8170% compared with the previous week [2]. - The important concerns for the bond market next week are the release of core macro - data and the large supply of interest - rate bonds [3]. - The capital interest rate rebounded slightly, but the overall liquidity remained in a loose and balanced state, and the market leverage declined slightly from a high level. The central bank continued to net withdraw liquidity in the open market this week, and the capital interest rate center rose slightly compared with last week, while the overall liquidity was still loose and abundant. Meanwhile, institutional trading remained active, and the trading volume of inter - bank pledged repurchase decreased slightly from a high level [4]. - In terms of primary bond supply, the net financing scale of interest - rate bonds and certificates of deposit decreased significantly this week, showing an overall net repayment state. The net financing scale of interest - rate bonds decreased mainly due to the obvious reduction in the issuance of Treasury bonds and local bonds. The net financing scale of inter - bank certificates of deposit turned from positive to negative, with the net repayment scale of large - bank certificates of deposit increasing further and the net financing of joint - stock banks decreasing significantly [4]. - In terms of secondary market operation, the long - end was significantly pressured under the influence of a significant increase in the inflation center and export data far exceeding expectations, while the short - end continued to decline benefiting from the stable and loose capital market, and the yield curve steepened significantly [4]. 3. Summary According to the Directory 3.1. Money Market 3.1.1. Open - market Liquidity Injection - The central bank net withdrew 25.11 billion yuan of liquidity from the open market this week (2026.03.9 - 2026.03.13). Specifically, the injection was 17.65 billion yuan from reverse repurchases, and the withdrawals were 27.76 billion yuan from reverse - repurchase maturities and 15 billion yuan from the maturity of treasury cash fixed deposits. As of March 13, 2026, the balance of 7 - day reverse repurchases was 17.65 billion yuan, a decrease of 10.11 billion yuan compared with the previous week [11]. 3.1.2. Capital Market Operation - In terms of capital operation, the central bank continued to withdraw liquidity in the open market, and the capital interest rate center rose slightly compared with last week, but the overall liquidity was still loose and abundant. As of March 13, 2026, DR007 was 1.46%, up 4.67BP from the previous week, and R007 was 1.50%, up 1.13BP from the previous week. In terms of leverage, institutional trading remained active, and the trading volume of inter - bank pledged repurchase decreased slightly from a high level. As of March 13, 2026, the trading volume of inter - bank pledged repurchase (5DMA basis) was 8.57 trillion yuan, a decrease of 0.07 trillion yuan from the previous week [19]. 3.2. Cash Bond Market 3.2.1. Primary Supply - The total net supply scale of interest - rate bonds this week was - 8.6786 billion yuan, a decrease of 20.5065 billion yuan compared with the previous week. The cumulative net supply scale of interest - rate bonds this year as of this week was 265.264 billion yuan, among which Treasury bonds, policy - financial bonds, and local bonds were 53.386 billion yuan, 2.003 billion yuan, and 209.875 billion yuan respectively. The net financing scale of certificates of deposit this week was - 11.306 billion yuan, a decrease of 14.464 billion yuan compared with the previous week. Specifically, the net supply scale of Treasury bonds was - 29.4 billion yuan, a decrease of 29.3 billion yuan; the net supply scale of policy - financial bonds was 14.4 billion yuan, an increase of 28.095 billion yuan; the net supply scale of local bonds was 6.3214 billion yuan, a decrease of 19.3015 billion yuan. The net financing scale of state - owned banks was - 14.958 billion yuan, a decrease of 5.827 billion yuan; the net financing scale of joint - stock banks was 3.652 billion yuan, a decrease of 8.637 billion yuan [33]. 3.2.2. Secondary Operation - **Absolute Level**: The long - end performed worse than the short - end, and the interest - rate curve continued to steepen. For example, the yield curves of Treasury bonds and China Development Bank bonds tended to steepen. The yields of 10Y and 30Y Treasury bonds increased significantly, the yield of 20Y China Development Bank bonds increased significantly, the yields of local bonds at all maturities increased, and the yields of certificates of deposit at all maturities decreased slightly [38][41][49]. - **Term Spread**: Most of the long - end term spreads widened, and the spread between 9M/1Y certificates of deposit compressed. For example, the 10Y - 1Y Treasury bond term spread and the 30Y - 10Y Treasury bond term spread widened significantly, while the 1Y - 9M AAA certificate of deposit term spread narrowed [48][54]. - **Variety Spread**: All variety spreads narrowed this week. For example, the 1Y and 10Y China Development Bank/Treasury bond variety spreads, the 30Y local bond/Treasury bond variety spread, and the 1Y certificate of deposit/China Development Bank bond variety spread all narrowed [57]. - **Overseas Spread**: The 10Y China - US spread widened, and the 1Y China - US spread narrowed [62]. 3.3. Next Week's Bond Market Matters - On March 16 (Monday), 1 - 2 month economic data will be released, and it is necessary to pay attention to whether the economic recovery at the beginning of the year exceeds market expectations. - On March 20 (Friday), the 3 - month LPR quote will be released, which is likely to be the same as the previous month. - On March 19 (Thursday), the issuance scale of local bonds over 10Y is about 7.26 billion yuan, and it is necessary to pay attention to the primary issuance situation. - In addition, there are specific situations of open - market operation maturities, Treasury bond supply, and local bond supply every day next week [3][4][66][68].

1. Report Industry Investment Rating No relevant content provided. 2. Core View of the Report The report analyzes the performance of major asset classes in the week from March 9th to March 13th, 2026, including the equity market, convertible bond market, fixed - income market, and commodity market, and explains the reasons for the market trends [5][10][11]. 3. Summary by Directory 3.1 This Week's Major Asset Performance - The equity market adjusted. The Shanghai Composite Index fell 0.7%, the Shenzhen Component Index rose 0.76%, and the ChiNext Index rose 2.51%. The trading volume of the Shanghai and Shenzhen stock markets decreased slightly. The Hang Seng Index fell 1.13%, and the Hang Seng Tech Index rose 0.62% [5][10]. - The convertible bond market weakened. The CSI Convertible Bond Index fell 1.1% in a week and 3.38% in a month, and the Shanghai Convertible Bond Index fell 1.52% in a week and 4.02% in a month [5][10]. - The bond market weakened, with short - end adjustment. The 1 - year Treasury bond yield declined by 0.9bp, while the yields of 3 - year, 5 - year, 7 - year, 10 - year, and 30 - year Treasury bonds rose [5][10]. - Commodity futures showed mixed performance, with strong performance in crude oil. COMEX gold fell 3.05%, COMEX silver fell 4.78%, LME copper fell 1.04%, LME aluminum rose 0.23%, WTI crude oil rose 8.59%, SHFE rebar rose 1.75%, CBOT soybeans rose 1.83%, and CBOT corn rose 1.36% [5][11]. 3.2 Equity Market Performance - Stocks - The equity market fluctuated downward this week. The Shanghai Composite Index oscillated and recovered at the beginning of the week, continued to rise in the middle of the week, and fell on Friday [13]. - In terms of industries, most industries rose. The construction and coal sectors led the gains, while the national defense and military industry, non - ferrous metals, and petroleum and petrochemical sectors led the losses. The national defense and military industry fell 5.3%, non - ferrous metals fell 5.07%, and petroleum and petrochemicals fell 4.22%. The construction sector rose 7.7%, coal rose 5.85%, and agriculture, forestry, animal husbandry, and fishery rose 5.43% [13]. - The market rotation was still active. The market style switched again. Affected by the Two Sessions and geopolitical risks, the construction and energy sectors led the gains, the consumer sector adjusted, and the technology - growth sectors such as semiconductors and chips were relatively weak [13]. 3.3 Equity Market Performance - Convertible Bonds - The convertible bond market followed the stock market down this week. As of March 13, 2026, the CSI Convertible Bond Index fell 1.1%, and the Shanghai Convertible Bond Index fell 1.52%. In the past month, the CSI Convertible Bond Index fell 3.38%, and the Shanghai Convertible Bond Index fell 4.02%. The trading volume of convertible bonds decreased, while the trading volume of underlying stocks recovered [17]. - The convertible bond market was weak this week, following the stock market adjustment. Affected by the Iran situation, the decline narrowed compared with last week. Funds switched from sectors with high previous gains such as military, technology, and non - ferrous metals to low - valuation and policy - favored sectors such as construction and coal [17]. 3.4 Fixed - Income Market Performance - Bond yields mostly rose this week, with the 1 - year Treasury bond yield slightly declining. The 1 - year Treasury bond yield declined by 0.9bp, while the yields of 3 - year, 5 - year, 7 - year, 10 - year, and 30 - year Treasury bonds rose [21]. - On March 12, the central bank governor emphasized the "moderately loose" monetary policy, and the Ministry of Finance refined the use of 1.3 trillion ultra - long - term special Treasury bonds, alleviating market concerns about long - term interest rate supply. Attention should be paid to the implementation rhythm of fiscal tools and the actual performance of inflation data [21]. - In terms of the capital side, the central bank had net withdrawals this week, mainly due to the continuous withdrawal of cash after the Spring Festival and the high level of bank system liquidity. It is expected that the central bank will maintain reasonable and sufficient liquidity [22]. 3.5 Commodity Market Performance - The Nanhua Commodity Index mostly strengthened this week, with strong performance in energy and chemicals and weak performance in precious metals. The comprehensive index rose 5.18%, energy and chemicals rose 9.76%, metals rose 1.11%, precious metals fell 1.52%, industrial products rose 6.29%, and agricultural products rose 2.72% [32]. - The gold price showed a trend of rising first and then falling. Geopolitical conflicts between the US, Israel, and Iran led to a rise in international oil prices, and many countries released strategic oil reserves. The uncertainty of the US - Iran conflict still exists, and the hedging value of precious metals is still prominent. It is expected that precious metals will maintain high - level volatility in the short term [33][35].

Group 1: Macroeconomic Trends - Concerns about "stagflation" are intensifying due to rising oil prices, which have exceeded $100 per barrel, impacting inflation expectations and suppressing the Federal Reserve's rate cut outlook[3] - The U.S. 2-year Treasury yield has risen, indicating tightening liquidity, while the dollar index has surpassed 100, driven by risk aversion[10] - In February, China's CPI rose by 1.3% year-on-year, marking the highest increase in nearly three years, primarily due to concentrated consumer demand during the Spring Festival[12] Group 2: Market Performance - Domestic A-shares outperformed overseas markets, driven by the Two Sessions, with strong performances in sectors like coal, electricity, and construction materials[9] - Despite pressure on overseas non-ferrous metals, domestic commodities like rebar, iron ore, and coking coal showed resilience, with agricultural products continuing to rise due to inflationary pressures[10] - The VIX index closed at 27, indicating that fear in the U.S. stock market is not extreme, suggesting limited potential for a significant rebound in the short term[10] Group 3: Export and Import Data - China's exports in January-February increased by 21.8% year-on-year, significantly higher than the market consensus of 6.4%, with a month-on-month growth of 9.7%[18] - Exports to the U.S. saw a remarkable month-on-month increase of 21.3%, reflecting a substantial recovery compared to December[17] - Imports also rebounded, with a year-on-year growth of 19.8% in January-February, driven by machinery and high-tech products[18]

Strategy Insights - The report emphasizes the importance of controlling volatility and focusing on new energy sectors while recognizing the resilience of domestic demand [1] - The current geopolitical tensions, particularly in the Middle East, have led to significant uncertainty in global financial markets, impacting trading strategies [3][8] - The report categorizes assets into three types based on their correlation with the worsening Middle East situation: crisis trading, stagflation trading, and normalization trading [8][19] Group 1: Geopolitical Trading Logic - The report identifies three categories of overseas scenario trading assets: crisis trading, stagflation trading, and normalization trading, each with distinct characteristics and implications for investment strategies [8] - Crisis trading assets, such as energy and shipping, are directly affected by supply shocks and are expected to gain risk premiums [8] - Stagflation trading focuses on assets that can withstand supply shocks, such as gold and domestic demand assets, which are expected to show relative stability [8][19] Group 2: Focus on New Energy and Domestic Demand - The report highlights that new energy sectors, including wind, solar, and lithium batteries, are expected to benefit from the current geopolitical landscape and have a strong mid-term outlook [3][41] - Domestic demand-related sectors, such as food and beverage, beauty care, real estate, pharmaceuticals, retail, and banking, are noted for their low volatility, with historical volatility levels below 50% [3][41] - The report anticipates a stabilization and potential recovery in domestic prices, further supporting the outlook for these sectors [3][41] Group 3: Fertilizer and Semiconductor Materials - The report points out that the fertilizer sector, particularly nitrogen, phosphorus, and potassium fertilizers, is facing supply disruptions due to geopolitical tensions, with the Middle East being a critical supplier [23][24] - The report also highlights the potential impact on semiconductor materials, particularly helium, due to supply disruptions from Qatar, which could significantly affect the semiconductor industry [24][25] Group 4: Market Dynamics and Volatility - The report notes that the current market environment is dominated by crisis trading, with significant fluctuations in asset prices driven by geopolitical uncertainties [19][26] - It emphasizes the need to identify low-volatility assets that are less correlated with the ongoing geopolitical tensions, suggesting a focus on sectors with historically lower volatility [26][29] - The report indicates that the market is beginning to shift towards low-volatility sectors, reflecting a heightened demand for certainty amid rising overall market volatility [29]