Investment Rating - The report rates the engineering machinery industry as "Outperform" compared to the market [1] Core Insights - The engineering machinery industry is experiencing a new development phase driven by domestic renewal demand, rapid overseas export growth, and accelerated electrification transformation [1][2] - The global engineering machinery market is projected to reach USD 237.6 billion in 2024, with a highly concentrated competitive landscape [1][21] - Domestic demand is stabilizing and recovering, supported by infrastructure investment and equipment renewal policies, while electrification is expected to initiate a new growth cycle [2][27] - Export growth is recovering, with significant potential for Chinese companies in overseas markets, particularly in regions involved in the Belt and Road Initiative [3][49] Summary by Sections Domestic Market - Excavator sales in China are showing signs of recovery, with a year-on-year increase of 18.60% from January to November 2025 [2][27] - The recovery is driven by three main factors: infrastructure investment, the arrival of the equipment renewal cycle, and the expansion of application scenarios [2][30] - The electrification of machinery is gaining momentum, with electric loader penetration reaching 23% in the first three quarters of 2025 [2][42] Overseas Market - From 2015 to 2022, excavator exports grew at a CAGR of 52.41%, with a recovery trend observed in 2024 [3][49] - The export volume of excavators increased by 14.90% year-on-year from January to November 2025, indicating a strong recovery [3][49] - The Belt and Road Initiative is providing strategic opportunities for Chinese engineering machinery companies to expand internationally [24][49] Competitive Landscape - The competitive landscape is stable, with leading companies dominating the market [3][49] - The report highlights that the top three global players hold over 30% market share, with Chinese companies gradually increasing their global market share [1][21] - The engineering machinery industry is transitioning from a traditional cyclical sector to a high-end manufacturing field characterized by globalization and electrification [4][49] Investment Value Analysis - The CSI Engineering Machinery Index reflects the overall market performance of leading companies in the engineering machinery sector, with a focus on large-cap stocks [4][8] - The index's valuation is currently at a historically high level, but with expected growth in domestic demand and global expansion, the industry is anticipated to experience significant profit growth [4][8] - The report emphasizes the long-term investment value of the index amid ongoing industrial upgrades and accelerated internationalization [4][8]

Report Industry Investment Rating No relevant content provided. Core Viewpoints - Last week, the central bank announced bond purchases of 50 billion yuan in November, with the purchase scale remaining the same as in October. There was a significant net withdrawal in the open - market operations, inflation continued to recover in December, and the A - share market started the year with strong volume and price. The bond market first declined and then rebounded, and the yield of ultra - long bonds reached a new high during the week. The trading activity of ultra - long bonds increased slightly and was very active. Both the term spread and the variety spread of ultra - long bonds widened [1][4][11][38]. - As of January 9, the spread between 30 - year treasury bonds and 10 - year treasury bonds was 42BP, at a historically low level. The spread between 20 - year CDB bonds and 20 - year treasury bonds was 14BP, at a historically extremely low position. Considering the economic situation and market factors, the bond market is more likely to fluctuate. It is expected that the 30 - 10 spread will fluctuate at a high level in the near term, and the variety spread of 20 - year CDB bonds will have a narrow - range fluctuation [2][3][12][13]. Summary by Relevant Catalogs Weekly Review Ultra - long Bond Review - The central bank's bond - buying scale in November was 50 billion yuan, the same as in October. With open - market net withdrawal, inflation recovery, and A - share market strength, the bond market first declined and then rebounded. The ultra - long bond yield reached a new high during the week. Trading activity increased slightly and was very active. Both term and variety spreads widened [1][11]. Ultra - long Bond Investment Outlook - **30 - year Treasury Bonds**: As of January 9, the 30 - 10 spread was 42BP, at a low historical level. The domestic economic downward pressure increased in November, with the estimated GDP growth rate of about 4.1% year - on - year, a 0.1% decline from October. In December, CPI was 0.8% and PPI was - 1.9%, and the deflation risk continued to ease. The bond market is likely to fluctuate, and the 30 - 10 spread is expected to fluctuate at a high level [2][12]. - **20 - year CDB Bonds**: As of January 9, the 20 - year CDB bond - treasury bond spread was 14BP, at an extremely low historical position. The economic situation is similar to that of 30 - year treasury bonds. The bond market is likely to fluctuate, and the variety spread of 20 - year CDB bonds is expected to have a narrow - range fluctuation [3][13]. Ultra - long Bond Basic Overview - The balance of outstanding ultra - long bonds is 24.3 trillion yuan. As of December 31, the total amount of ultra - long bonds with a remaining maturity of more than 14 years was 24.4329 trillion yuan, accounting for 15.1% of the total bond balance. Local government bonds and treasury bonds are the main varieties. By variety, treasury bonds account for 28.2%, local government bonds 66.4%, etc. By remaining maturity, the 25 - 35 - year variety accounts for the highest proportion at 40.2% [14]. Primary Market Weekly Issuance - Last week (January 4 - 9, 2026), the issuance of ultra - long bonds surged to 191.6 billion yuan. By variety, local government bonds accounted for 185.8 billion yuan. By term, 30 - year bonds accounted for 115.1 billion yuan [20]. This Week's Scheduled Issuance - The announced ultra - long bond issuance plan for this week is 84.2 billion yuan, including 32 billion yuan of ultra - long treasury bonds and 51.7 billion yuan of ultra - long local government bonds [24]. Secondary Market Trading Volume - Last week, the trading of ultra - long bonds was very active, with a turnover of 984.1 billion yuan, accounting for 11.3% of the total bond turnover. The trading activity increased slightly compared with the previous week [28]. Yield - Due to factors such as central bank bond - buying and market conditions, the ultra - long bond yield reached a new high during the week. The yields of 15 - year, 20 - year, 30 - year, and 50 - year treasury bonds changed by 3BP, 4BP, 4BP, and 5BP respectively [38]. Spread Analysis - The term spread of ultra - long bonds widened last week, with an absolute low level. The variety spread also widened, with an absolute low level. The 30 - 10 treasury bond spread was 42BP, and the 20 - year CDB bond - treasury bond spread was 14BP [50][51]. 30 - year Treasury Bond Futures - Last week, the 30 - year treasury bond futures main contract TL2603 closed at 110.87 yuan, with a decline of - 0.48%. The trading volume increased significantly, and the open interest increased slightly [54].

Report Industry Investment Rating No relevant content provided. Core Viewpoints of the Report - Last week (from January 5th to January 9th, 2026), the median weekly return of equity ETFs was 4.31%. Among broad-based ETFs, the median return of Science and Technology Innovation Board ETFs was 10.15%, the highest. By sector, the median return of technology ETFs was 7.28%, the highest. By theme, the median return of military industry ETFs was 13.50%, the highest [1][12][16]. - Last week, equity ETFs had a net redemption of 803 million yuan, but the overall scale increased by 18.0114 billion yuan. Among broad-based ETFs, CSI 500 ETF had the largest net subscription of 3.648 billion yuan; by sector, cyclical ETFs had the largest net subscription of 13.524 billion yuan; by hot theme, pharmaceutical ETFs had the largest net subscription of 892 million yuan [2][28][31]. - As of last Friday, among broad-based ETFs, ChiNext and SSE 50 ETFs had relatively low valuation quantiles; by sector, large financial and consumer ETFs had relatively moderate valuation quantiles; by sub - theme, wine and new energy vehicle ETFs had relatively low valuation quantiles. Compared with the previous week, the valuation quantiles of CSI 1000, Science and Technology Innovation Board, consumer, and pharmaceutical ETFs increased significantly [3][34][38]. - From Monday to Thursday last week, the margin trading balance of equity ETFs increased from 46.967 billion yuan in the previous week to 48.697 billion yuan, and the short - selling volume increased from 2.394 billion shares in the previous week to 2.42 billion shares. Among the top 10 ETFs in terms of average daily margin buying volume and short - selling volume, securities ETFs and Science and Technology Innovation Board ETFs had relatively high average daily margin buying volumes, and SSE 50 ETFs and CSI 1000 ETFs had relatively high average daily short - selling volumes [4][44][48]. - As of last Friday, Huaxia, E Fund, and Huatai - Peregrine ranked top three in the total scale of listed non - monetary ETFs among fund companies. This week, 9 ETFs will be issued, including Penghua China Securities Consumer Electronics Theme ETF, Yin Hua S&P Hong Kong Stock Connect Low - Volatility Dividend ETF, etc. [5][52][55]. Summary by Relevant Catalogs ETF Performance - Last week, the median weekly return of equity ETFs was 4.31%. The median returns of Science and Technology Innovation Board, CSI 500, CSI 1000, A500, ChiNext, SSE 50, and SSE 300 ETFs were 10.15%, 7.89%, 7.05%, 4.22%, 3.87%, 3.38%, and 2.78% respectively. The median returns of commodity, cross - border, monetary, and bond ETFs were 2.92%, 2.55%, 0.02%, and - 0.01% respectively [12]. - By sector, the median returns of technology, consumer, cyclical, and large financial sector ETFs among equity ETFs last week were 7.28%, 4.95%, 4.15%, and 1.82% respectively [16]. - By hot theme, the median returns of military industry, chip, and AI ETFs among equity ETFs were 13.50%, 11.17%, and 8.51% respectively, showing relatively strong performance; the median returns of bank, dividend, and securities ETFs were - 1.88%, 1.62%, and 1.91% respectively, showing relatively weak performance [16]. ETF Scale Change and Net Subscription/Redeem - As of last Friday, the scales of equity, cross - border, and bond ETFs were 398.11 billion yuan, 101.07 billion yuan, and 76.46 billion yuan respectively. The scales of commodity and monetary ETFs were relatively small, at 26.47 billion yuan and 16.21 billion yuan respectively [20]. - Among broad - based ETFs, SSE 300 and A500 ETFs had relatively large scales of 122.08 billion yuan and 29.96 billion yuan respectively, while the scales of Science and Technology Innovation Board, CSI 500, CSI 1000, SSE 50, and ChiNext ETFs were relatively small [20]. - By sector, as of last Friday, the scale of technology sector ETFs was 47.09 billion yuan, followed by cyclical sector ETFs with a scale of 24.83 billion yuan. The scales of large financial and consumer ETFs were relatively small [26]. - By hot theme, as of last Friday, the scales of chip, securities, and pharmaceutical ETFs were the highest, at 16.17 billion yuan, 14.31 billion yuan, and 10.88 billion yuan respectively [26]. - Last week, equity ETFs had a net redemption of 803 million yuan, and the overall scale increased by 18.0114 billion yuan; monetary ETFs had a net redemption of 1.0539 billion yuan, and the overall scale decreased by 1.0525 billion yuan [28]. - Among broad - based ETFs, CSI 500 ETF had the largest net subscription of 3.648 billion yuan, and its scale increased by 1.8996 billion yuan; A500 ETF had the largest net redemption of 1.3087 billion yuan, and its scale decreased by 59.5 million yuan [28]. - By sector, last week, cyclical ETFs had the largest net subscription of 13.524 billion yuan, and its scale increased by 2.9669 billion yuan; technology ETFs had the largest net redemption of 763 million yuan, and its scale increased by 3.5292 billion yuan [31]. - By hot theme, last week, pharmaceutical ETFs had the largest net subscription of 892 million yuan, and its scale increased by 893.9 million yuan; AI ETFs had the largest net redemption of 538.9 million yuan, and its scale decreased by 9.2 million yuan [31]. ETF Benchmark Index Valuation - As of last Friday, the price - to - earnings ratios of SSE 50, SSE 300, CSI 500, CSI 1000, ChiNext, and A500 ETFs were at the quantile levels of 89.27%, 90.68%, 100.00%, 100.00%, 66.50%, and 99.74% respectively, and the price - to - book ratios were at the quantile levels of 73.68%, 75.83%, 100.00%, 79.37%, 67.90%, and 99.74% respectively. Since December 31, 2019, the current price - to - earnings and price - to - book ratios of Science and Technology Innovation Board ETFs are at the quantile levels of 92.00% and 79.79% respectively. Compared with the previous week, the valuation quantiles of CSI 1000 and Science and Technology Innovation Board ETFs increased significantly [34][36]. - As of last Friday, the price - to - earnings ratios of cyclical, large financial, consumer, and technology sector ETFs were at the quantile levels of 87.54%, 29.87%, 37.87%, and 98.43% respectively, and the price - to - book ratios were at the quantile levels of 83.91%, 57.34%, 45.26%, and 96.04% respectively. Compared with the previous week, the valuation quantile of consumer ETFs increased significantly [38]. - As of last Friday, the price - to - earnings quantiles of military industry, photovoltaic, and chip ETFs were relatively high, at 100.00%, 99.75%, and 98.60% respectively; the price - to - book quantiles of AI, robot, and dividend ETFs were relatively high, at 100.00%, 98.93%, and 98.35% respectively. Compared with the previous week, the valuation quantile of pharmaceutical ETFs increased significantly [39][42]. ETF Margin Trading - Overall, the short - selling volume of equity ETFs has maintained an upward trend in the past year. As of last Thursday, the margin trading balance of equity ETFs increased from 46.967 billion yuan in the previous week to 48.697 billion yuan, and the short - selling volume increased from 2.394 billion shares in the previous week to 2.42 billion shares [44]. - From Monday to Thursday last week, among the top 10 equity ETFs in terms of average daily margin buying volume, securities ETFs and Science and Technology Innovation Board ETFs had relatively high average daily margin buying volumes [48]. - From Monday to Thursday last week, among the top 10 equity ETFs in terms of average daily short - selling volume, SSE 300 ETFs and CSI 1000 ETFs had relatively high average daily short - selling volumes [50]. ETF Managers - As of last Friday, Huaxia Fund ranked first in the total scale of listed non - monetary ETFs, and had a relatively high management scale in multiple sub - fields such as scale index ETFs, theme, style, and strategy index ETFs, and cross - border ETFs; E Fund ranked second, and had a relatively high management scale in scale index ETFs and cross - border ETFs; Huatai - Peregrine Fund ranked third, and had a relatively high management scale in scale index ETFs and theme, style, and strategy index ETFs [52]. - Last week, 2 new ETFs were established, namely Guangfa China Securities Industrial Software Theme ETF and ICBC ChiNext New Energy ETF. This week, 9 ETFs will be issued, including Penghua China Securities Consumer Electronics Theme ETF, Yin Hua S&P Hong Kong Stock Connect Low - Volatility Dividend ETF, etc. [55].

Core Insights - The report continues to recommend innovative drugs and the related industry chain, highlighting the strong growth potential in the pharmaceutical sector through 2026 [1][4]. Investment Strategy - The investment strategy emphasizes the focus on the CXO sector, particularly in chemical CDMO, where Chinese companies hold significant advantages in talent, chemical capabilities, compliance production, and intellectual property protection [4]. - The report suggests that the upcoming JPM conference will provide updates on the operational progress of Chinese innovative drug companies, which have shown a long-term positive development trend [4]. - The recommended investment portfolio includes A-shares such as Mindray Medical, WuXi AppTec, and Aier Eye Hospital, as well as H-shares like Kangfang Biologics and WuXi Biologics [4][5]. Industry Performance - The pharmaceutical industry experienced a decline of 4.10% in December, underperforming the CSI 300 index by 6.38% [8]. - The report notes that the chemical pharmaceutical sector saw the largest declines among sub-sectors, with a drop of 5.80% [12]. Market Data - For the period from January to November 2025, the pharmaceutical manufacturing industry's total revenue was 220.65 billion yuan, reflecting a year-on-year decrease of 2.0% [7]. - The total retail sales of consumer goods reached 45.61 trillion yuan, with retail sales of Western and Chinese medicines amounting to 660.4 billion yuan, a year-on-year increase of 1.8% [7]. Regulatory Environment - The report discusses the impact of the U.S. "Biological Safety Act," which is expected to have a limited short-term effect on Chinese CXO companies, while emphasizing the need to monitor the long-term implications of international competition and regulatory changes [22]. Recent Drug Approvals - In December 2025, a total of 16 innovative drugs or biosimilars were approved for market entry, including six domestic and ten imported products [24][25].

1. Report Industry Investment Rating No relevant content provided. 2. Core View This week, the China Securities REITs Index rose 1.9% throughout the week, with all sectors posting gains and market trading activity also increasing. From the comparison of the weekly price changes of major indices, China Securities Convertible Bonds > CSI 300 > China Securities REITs > China Securities Aggregate Bonds. As of January 9, 2026, the dividend yield of equity REITs was 59 basis points lower than the average dividend yield of CSI Dividend stocks, and the spread between the average internal rate of return of franchise - based REITs and the 10 - year Treasury yield was 332 basis points [1]. 3. Summary by Related Catalogs 3.1 Secondary Market Trends - The weekly price change of the China Securities REITs Index was +1.9%, and the price change since the beginning of the year was +0.4%. As of January 9, 2026, the closing price of the China Securities REITs (closing) Index was 793.05 points. Throughout the week (from January 5 to January 9, 2026), its performance was weaker than the China Securities Convertible Bonds Index (+4.4%) and the CSI 300 Index (+2.8%), but stronger than the China Securities Aggregate Bonds Index (-0.1%). Since the beginning of the year, the order of price changes of major indices was: China Securities Convertible Bonds (+23.9%) > CSI 300 (+20.9%) > China Securities Aggregate Bonds (+0.5%) > China Securities REITs (+0.4%) [2][6]. - In the past year, the return rate of the China Securities REITs Index was -2.0%, and the volatility was 7.7%. The return rate was lower than that of the CSI 300 Index, the China Securities Convertible Bonds Index, and the China Securities Aggregate Bonds Index; the volatility was lower than that of the CSI 300 Index and the China Securities Convertible Bonds Index, but higher than that of the China Securities Aggregate Bonds Index. The total market value of REITs on January 9 was 223.3 billion yuan, an increase of 3.4 billion yuan from the previous week; the average daily turnover rate for the whole week was 0.60%, an increase of 0.08 percentage points from the previous week [2][8]. 3.2 Sector Performance - All sectors posted gains, with municipal facilities, new infrastructure, and water conservancy REITs leading the gains. From the perspective of different project - attribute REITs, the average weekly price changes of equity REITs and franchise - based REITs were +2.8% and +1.6% respectively. Among specific targets, the top three REITs in terms of weekly price increase were E Fund Biwei Market REIT (+7.84%), GF Chengdu Gaotou Industrial Park REIT (+6.91%), and China Merchants Science and Technology Innovation REIT (+6.24%) [3][16][21]. - New infrastructure REITs had the highest trading activity. In terms of different project types, new infrastructure REITs had the highest average daily turnover rate during the period, with an average daily turnover rate of 1.0%; consumer infrastructure REITs had the highest proportion of trading volume this week, accounting for 22.3% of the total REITs trading volume. In terms of the capital flow of different REIT products this week, the top three in terms of net inflow of main funds were Huaxia China Resources Commercial REIT (121.76 million yuan), CICC Anhui Expressway REIT (79.3 million yuan), and Southern Runze Technology Data Center REIT (53.82 million yuan) [3][23][24]. 3.3 Primary Market Issuance From the beginning of the year to January 9, 2026, there was 1 REIT product in the "accepted" stage, 1 in the "inquiry" stage, and 2 in the "feedback" stage on the exchange [26]. 3.4 Valuation Tracking - REITs have both bond - like and stock - like characteristics. From the bond - like perspective, under the constraint of mandatory high dividends, the annualized cash distribution rate is concerned. As of January 9, the average annualized cash distribution rate of public - offering REITs was 5.96%. From the stock - like perspective, the relative net value premium rate, IRR, and P/FFO are used to judge the valuation of REITs [28]. - As of January 9, 2026, the dividend yield of equity REITs was 59 basis points lower than the average dividend yield of CSI Dividend stocks, and the spread between the average internal rate of return of franchise - based REITs and the 10 - year Treasury yield was 332 basis points [1][29][30]. 3.5 Industry News Shanghai Jinjiang Asset Management Co., Ltd. recently announced the short - listed candidates for the fund manager, special plan manager, and financial advisor of its public - offering REIT project. The first short - listed candidate is a consortium composed of Huaan Fund, Huaan Future Asset, and Guotai Haitong Securities, with an issuance - stage fee of 5 million yuan and a 0.2% ongoing fee. The second short - listed candidate is a consortium composed of Dongwu Fund and Dongwu Securities, with the same quotation conditions. The announcement period ends on January 10. As of June 30, 2025, Jinjiang Hotels had over 17,700 contracted hotels, over 1.68 million rooms, and over 200 million members [4][32].

Investment Rating - The investment rating for the lithium battery industry is "Outperform the Market" (maintained) [1] Core Insights - The solid-state battery industry is accelerating, with the first national standard for automotive solid-state batteries being publicly solicited for opinions. Key projects include the production of a 2GWh solid-state lithium metal battery by Xinjie Energy and the successful trial production of a full solid-state battery pack by Hongqi [6][19] - A meeting held by four ministries highlighted the need to regulate competition in the power and energy storage battery industry, addressing issues like irrational competition and overcapacity risks. The meeting emphasized the importance of market order and quality supervision [6][16] - Recent adjustments to export tax policies for lithium batteries and materials are expected to enhance the competitive advantage of leading companies in the industry, potentially leading to price increases and alleviating low-price competition issues [6][16] Industry Dynamics - Domestic new energy vehicle sales reached 1.478 million units from January to November, a year-on-year increase of 31%, with a penetration rate of 53.2% [6] - In Europe, new energy vehicle sales in December reached 324,000 units, up 39% year-on-year, while in the US, sales were 83,600 units, down 42% year-on-year [6] - Lithium salt prices have risen, with lithium carbonate priced at 140,000 yuan per ton, an increase of 28,100 yuan compared to two weeks ago [6][26] Investment Recommendations - Focus on leading companies in the lithium battery industry with low valuations amid sustained demand, including CATL, Yiwei Lithium Energy, and others [6] - Consider companies leading in the low-carbon economy and robotics sectors, as well as those with solid-state battery material capabilities [6] - Monitor companies in the charging pile industry and those leading in lead-acid batteries for electric bicycles [6]

Report Industry Investment Rating - Not provided in the content Core Viewpoints of the Report - Last week (from January 5th to January 9th, 2026), the median weekly return of equity ETFs was 4.31%. Among broad - based ETFs, the median return of Science and Technology Innovation Board ETFs was 10.15%, the highest. By sector, the median return of technology ETFs was 7.28%, the highest. By theme, the median return of military - themed ETFs was 13.50%, the highest [1][12][16]. - Last week, equity ETFs had a net redemption of 803 million yuan, but the overall scale increased by 18.0114 billion yuan. Among broad - based ETFs, CSI 500ETF had the most net subscriptions, reaching 3.648 billion yuan; by sector, cyclical ETFs had the most net subscriptions, at 13.524 billion yuan; by hot theme, pharmaceutical ETFs had the most net subscriptions, at 892 million yuan [1][2][28]. Summary by Relevant Catalogs ETF Performance - The median weekly return of equity ETFs last week was 4.31%. The median returns of Science and Technology Innovation Board ETFs, CSI 500ETF, CSI 1000ETF, A500ETF, ChiNext - related ETFs, SSE 50ETF, and CSI 300ETF were 10.15%, 7.89%, 7.05%, 4.22%, 3.87%, 3.38%, and 2.78% respectively. The median returns of commodity - type, cross - border, money - market, and bond - type ETFs were 2.92%, 2.55%, 0.02%, and - 0.01% respectively [1][12]. - By sector, the median returns of technology, consumer, cyclical, and large - finance sector ETFs among equity ETFs last week were 7.28%, 4.95%, 4.15%, and 1.82% respectively. By hot theme, the median returns of military, chip, and AI ETFs among equity ETFs were 13.50%, 11.17%, and 8.51% respectively, showing relatively strong performance, while the median returns of bank, dividend, and securities ETFs were - 1.88%, 1.62%, and 1.91% respectively, showing relatively weak performance [16]. ETF Scale Change and Net Subscription/Redeem - As of last Friday, the scales of equity, cross - border, and bond ETFs were 398.11 billion yuan, 101.07 billion yuan, and 76.46 billion yuan respectively. The scales of commodity - type and money - market ETFs were relatively small, at 26.47 billion yuan and 16.21 billion yuan respectively [20]. - Among broad - based ETFs, CSI 300ETF and A500ETF had relatively large scales, at 122.08 billion yuan and 29.96 billion yuan respectively. The scales of Science and Technology Innovation Board, CSI 500, CSI 1000, SSE 50, and ChiNext - related ETFs were relatively small, at 23.25 billion yuan, 21.00 billion yuan, 19.51 billion yuan, 18.99 billion yuan, and 18.02 billion yuan respectively [20]. - By sector, as of last Friday, the scale of technology sector ETFs was 47.09 billion yuan, followed by cyclical sector ETFs at 24.83 billion yuan. The scales of large - finance and consumer ETFs were relatively small, at 20.10 billion yuan and 19.19 billion yuan respectively. By hot theme, as of last Friday, the scales of chip, securities, and pharmaceutical ETFs were the highest, at 16.17 billion yuan, 14.31 billion yuan, and 10.88 billion yuan respectively [26]. - Last week, equity ETFs had a net redemption of 803 million yuan, and the overall scale increased by 18.0114 billion yuan; money - market ETFs had a net redemption of 1.0539 billion yuan, and the overall scale decreased by 1.0525 billion yuan. Among broad - based ETFs, CSI 500ETF had the most net subscriptions, at 3.648 billion yuan, and its scale increased by 1.8996 billion yuan; A500ETF had the most net redemptions, at 1.3087 billion yuan, and its scale decreased by 59.5 million yuan [28]. - By sector, last week, cyclical ETFs had the most net subscriptions, at 13.524 billion yuan, and their scale increased by 2.9669 billion yuan; technology ETFs had the most net redemptions, at 763 million yuan, and their scale increased by 3.5292 billion yuan. By hot theme, last week, pharmaceutical ETFs had the most net subscriptions, at 892 million yuan, and their scale increased by 893.9 million yuan; AI ETFs had the most net redemptions, at 538.9 million yuan, and their scale decreased by 9.2 million yuan [31]. ETF Benchmark Index Valuation - In broad - based ETFs, the price - to - earnings ratios of SSE 50ETF, CSI 300ETF, CSI 500ETF, CSI 1000ETF, ChiNext - related ETFs, and A500ETF were at the 89.27%, 90.68%, 100.00%, 100.00%, 66.50%, and 99.74% quantile levels respectively, and the price - to - book ratios were at the 73.68%, 75.83%, 100.00%, 79.37%, 67.90%, and 99.74% quantile levels respectively. Since December 31, 2019, the current price - to - earnings and price - to - book ratios of Science and Technology Innovation Board - related ETFs are at the 92.00% and 79.79% quantile levels respectively. Compared with the previous week, the valuation quantiles of CSI 1000 and Science and Technology Innovation Board ETFs increased significantly [34][36]. - As of last Friday, the price - to - earnings ratios of cyclical, large - finance, consumer, and technology sector ETFs were at the 87.54%, 29.87%, 37.87%, and 98.43% quantile levels respectively, and their price - to - book ratios were at the 83.91%, 57.34%, 45.26%, and 96.04% quantile levels respectively. Compared with the previous week, the valuation quantiles of consumer ETFs increased significantly [38]. - Among themed ETFs, the price - to - earnings quantiles of military, photovoltaic, and chip ETFs were relatively high, at 100.00%, 99.75%, and 98.60% respectively; the price - to - book quantiles of AI, robot, and dividend ETFs were relatively high, at 100.00%, 98.93%, and 98.35% respectively. Compared with the previous week, the valuation quantiles of pharmaceutical ETFs increased significantly [39][42]. - Overall, among broad - based ETFs, the valuation quantiles of ChiNext - related ETFs and SSE 50ETF were relatively low; by sector, the valuation quantiles of large - finance and consumer ETFs were relatively moderate; by sub - theme, the valuation quantiles of liquor and new energy vehicle ETFs were relatively low [43]. ETF Margin Trading - As of last Thursday, the margin trading balance of equity ETFs increased from 46.967 billion yuan in the previous week to 48.697 billion yuan, and the short - selling volume increased from 2.394 billion shares in the previous week to 2.420 billion shares [44]. - Among the top 10 ETFs with the highest average daily margin purchases and short - selling volumes from last Monday to Thursday, securities ETFs and Science and Technology Innovation Board ETFs had relatively high average daily margin purchases, while CSI 300ETF and CSI 1000ETF had relatively high average daily short - selling volumes [48][50]. ETF Managers - As of last Friday, Huaxia Fund ranked first in the total scale of listed non - money ETFs, and also had a relatively high management scale in multiple sub - fields such as scale index ETFs, theme, style, and strategy index ETFs, and cross - border ETFs; E Fund ranked second in the total scale of listed non - money ETFs, and had a relatively high management scale in scale index ETFs and cross - border ETFs; Huatai - PineBridge Fund ranked third in the total scale of listed non - money ETFs, and had a relatively high management scale in scale index ETFs and theme, style, and strategy index ETFs [52]. - Last week, 2 new ETFs were established, namely GF China Securities Industrial Software Theme ETF and ICBC ChiNext New Energy ETF. This week, 9 ETFs will be issued, including Penghua China Securities Consumer Electronics Theme ETF, Yin Hua S&P Hong Kong Stock Connect Low - Volatility Dividend ETF, Fullgoal China Securities Smart - Selected Shipbuilding Industry ETF, Guotai Hang Seng Biotechnology ETF, China Merchants China Securities Photovoltaic Industry ETF, Ping An Hang Seng Hong Kong Stock Connect Technology Theme ETF, Qianhai Kaiyuan Hang Seng Hong Kong Stock Connect Technology Theme ETF, Taikang China Securities Non - ferrous Metal Mining Theme ETF, and Invesco Great Wall China Securities Non - ferrous Metal Mining Theme ETF [55].

Investment Rating - The investment rating for the industry is "Outperform the Market" (maintained) [1]. Core Insights - AI applications are entering a global acceleration phase, with both domestic and overseas markets continuing to expand on a high base. As of September 2025, overseas AI application monthly active users (MAU) have surpassed 1.2 billion, a year-on-year increase of 76.7%, while China's AI application MAU reached 490 million, growing by 172.3% [12]. - AI search, composed of AI chatbots and AI search engines, has become the core engine of AI application development, shifting user behavior from "searching links" to "asking AI for answers." This transformation is reshaping information access and making shopping recommendations a core use case, fundamentally changing brand communication models [12][18]. - The Generative Engine Optimization (GEO) is revolutionizing traditional marketing models, enabling better advertising effectiveness by allowing brands to be directly referenced in AI-generated answers rather than just appearing in search results [13][17]. Summary by Sections AI Marketing: GEO Reshaping Advertising Models - GEO enables a complete transformation of advertising strategies, allowing brands to be directly referenced in AI-generated responses, enhancing exposure and engagement [13][17]. - The shift from traditional SEO to GEO is evident, with brands needing to optimize for AI-generated content rather than traditional search engine visibility [21][30]. AI Short/Anime Series: Multi-Modal Capabilities Driving Market Explosion - AI-driven short series, utilizing AIGC technology, significantly lower production costs and improve efficiency, making it a high-growth area in the content market [33][42]. - The number of AI animation micro-short series launched has been increasing, with 2,902 episodes released from January to August 2025, primarily targeting a younger audience [45]. Market Growth and Company Benefits - The GEO market is expected to grow rapidly, with projections indicating a global market size of $24 billion by 2026 and $100 billion by 2030. In China, the GEO market is anticipated to reach 11.1 billion yuan by 2026 and 36.5 billion yuan by 2028 [30]. - Companies benefiting from this trend include technology providers and content platforms such as 引力传媒, 光云科技, and 哔哩哔哩, which are positioned to capitalize on the shift towards GEO [30].

Investment Rating - The report maintains an "Outperform" rating for the non-bank financial sector [4][5][47]. Core Insights - The report highlights a significant shift in resident wealth allocation due to a low interest rate environment, leading to a reallocation of funds from traditional savings to riskier assets [1][12][19]. - The phenomenon of "deposit migration" is characterized by a transition from slow outflows to a more concentrated release of funds, indicating a rapid increase in market risk appetite [2][29]. - The report anticipates that the pulse-like release of deposits will provide substantial incremental capital to the A-share and Hong Kong markets, potentially exceeding 500 billion yuan in the first quarter [3][12]. Summary by Sections Deposit Low-Interest Environment - Deposit rates have fallen below 2%, prompting residents to seek higher-yielding investments [1][17]. - The decline in deposit attractiveness is pushing savings towards wealth management products and other financial instruments [13][19]. Wealth Management Transformation - There is a notable shift in asset allocation from bank deposits to non-bank financial products, with household deposits decreasing while non-bank financial institution deposits are increasing [20][22]. - The capital market's performance since June 2025 has catalyzed this shift, with the A-share market experiencing significant gains, thereby attracting more funds [20][24]. Changes in Deposit Migration - The report notes that the upcoming maturity of a significant volume of deposits, particularly three-year fixed deposits, will lead to a concentrated outflow of funds, enhancing risk appetite [29][33]. - The breaking of the "rigid redemption" of wealth management products has led to a reassessment of risk among conservative investors, prompting a return to safer deposit options [29][39]. Investment Recommendations - The report recommends focusing on non-bank financial institutions that are likely to benefit from the ongoing deposit migration trend, particularly in the insurance and brokerage sectors [3][43]. - Specific companies highlighted for their strong potential include China Life, Ping An, and major brokerage firms like CITIC Securities and Huatai Securities [4][43].

Economic Indicators - In December, China's manufacturing PMI returned above the growth line, indicating a positive economic recovery despite it being a traditional off-season[1] - The high-frequency macro diffusion index from Guosen also showed a significant seasonal rebound in December compared to November, confirming substantial improvement in domestic economic conditions[1] Policy Support - The recovery was primarily supported by the accelerated implementation of 500 billion yuan in policy financial tools and 500 billion yuan in local government bond limits, effectively boosting physical work output and manufacturing production[1] - Positive signals emerged in pricing, with the manufacturing output price index rising for two consecutive months, and both CPI and PPI turning positive in December, reflecting the effectiveness of policies aimed at improving supply-demand relationships[1] GDP Growth Forecast - Economic data for December is expected to show improvement compared to November, with Q4 GDP growth projected to reach around 4.5%, supporting the annual growth target of approximately 5%[2] - The delayed timing of the 2026 Spring Festival to February and the early allocation of 62.5 billion yuan in national subsidies are expected to sustain the current economic recovery momentum[2] Risks - There are risks associated with overseas market volatility, which may introduce uncertainties into the economic outlook[2]