Investment Rating - The investment rating for the company is "Accumulate" (maintained) [2] Core Views - The company has shown resilience in sales, with a sales amount of 16.3% year-on-year increase in September 2025, despite a 3.1% decline in sales for the first nine months of 2025 [8] - The company has significantly increased its investment intensity, with a total investment of 75.21 billion yuan in the first nine months of 2025, representing a year-on-year increase of 160.4% [8] - The company is expected to see a recovery in performance, with projected net profits of 4.32 billion yuan, 5.06 billion yuan, and 5.81 billion yuan for 2025-2027, corresponding to PE ratios of 20.9X, 17.8X, and 15.5X respectively [8] Financial Performance Summary - Revenue for 2023 is projected at 175.01 billion yuan, with a decline of 4.4% year-on-year, followed by a slight increase of 2.3% in 2024 [7] - The net profit for 2023 is expected to be 6.32 billion yuan, with a significant increase of 48.2% year-on-year, but a decline of 36.1% is anticipated for 2024 [7] - The earnings per share (EPS) for 2025 is estimated at 0.48 yuan, with a PE ratio of 20.9 [7] Investment Opportunities - The company has acquired high-quality land in the Jing'an District, with a transaction amount of 7.737 billion yuan, which is expected to contribute over 10 billion yuan in sales [8] - The company focuses on core cities and improvement-type products, leading to an increase in average sales price by 22.4% year-on-year to 27,700 yuan per square meter [8]

Core Insights - The report maintains a positive outlook on the industry, highlighting a 50% year-on-year increase in battery exports in September and a continued rise in the price of hexafluorophosphate lithium [1][3] Market Review - The Shanghai Composite Index fell by 1.47% this week, while the solid-state battery index dropped by 5.04%. Year-to-date, the Shanghai Composite Index has risen by 14.56%, and the solid-state battery index has increased by 46.42% [7][11] - Trading volume for the entire A-share market reached 10,964.26 billion yuan, up 110.61% week-on-week, with the solid-state battery index trading volume at 405.917 billion yuan, up 57.31% [7][11] Price Tracking in the Supply Chain - As of October 17, lithium carbonate (99.5% battery grade) is priced at 73,400 yuan per ton, down 120 yuan from the previous week. The price of lithium iron phosphate is 33,400 yuan per ton, down 900 yuan, while ternary material (523) has increased by 13.6 yuan per kilogram to 135.93 yuan [12][21] - The price of hexafluorophosphate lithium has risen to 79,000 yuan per ton, up 1,150 yuan from last week, and the average price of graphite electrodes remains stable at 12,500 yuan per ton [12][21] Industry News & Company Announcements - Since mid-September, the price of hexafluorophosphate lithium has surged, breaking its previous plateau. Prices increased from 56,000 yuan per ton on September 16 to 68,000 yuan per ton by October 13, with some quotes reaching 73,000 yuan per ton [28][29] - The Democratic Republic of Congo's cobalt export quota system took effect on October 16, which is expected to impact the global cobalt trade and the lithium battery supply chain [29] Battery Demand Tracking - In the first nine months of 2025, the production of power and other batteries reached 1,121.9 GWh, a year-on-year increase of 51.4%. In September alone, production was 151.2 GWh, up 35.85% year-on-year [30][31] - The power battery installation volume for the first nine months of 2025 was 493.9 GWh, up 42.5% year-on-year, with September's installation volume at 76 GWh, an increase of 39.45% [30][31] - Power battery exports totaled 129.1 GWh in the first nine months of 2025, a year-on-year increase of 21.7%, with September exports at 17.6 GWh, up 50.43% year-on-year [30][35] Lithium Battery Equipment Sector Insights - The report indicates that solid-state battery technology continues to make breakthroughs, with several automakers planning to adopt solid-state batteries around 2027. The industry is expected to accelerate its industrialization process [3][30] - The report suggests focusing on leading lithium battery equipment companies such as Xianlead Intelligent, Yinghe Technology, and Liyuanheng, as well as companies involved in the incremental segment like Jiao Cheng Ultrasonic and Hai Moxing [3][30]

Core Insights - Infrastructure investment has weakened in the first three quarters, with a notable decline in the proportion of special bonds used for broad infrastructure, dropping to approximately 31% from 45% in the previous year [5] - The valuation of central state-owned construction enterprises remains low, highlighting the investment value of high-dividend stocks in this sector, with dividend yields for several companies exceeding 4.6% [5] - The Xinjiang region is expected to benefit from ongoing infrastructure investments, with significant projects underway that will positively impact local leading engineering firms and suppliers [5] Infrastructure Investment Trends - As of October 19, 2025, special bonds issued reached 3.7 trillion yuan, a year-on-year increase of 2.01%, but the investment growth rates for narrow and broad infrastructure were only 2.00% and 5.42% respectively from January to August 2025 [5] - In August 2025, narrow and broad infrastructure investments saw year-on-year declines of 5.85% and 6.42%, indicating a slowdown in growth momentum [5] Valuation and Dividend Insights - As of October 17, 2025, several central state-owned construction companies exhibited attractive dividend yields, such as China State Construction at 4.86% and China Railway Construction at 6.06% in the Hong Kong market [5] - The price-to-earnings ratios for these companies are significantly low, with China Railway Construction at 3.61 times, indicating a historical valuation level that presents a potential investment opportunity [5] Regional Investment Opportunities - The Xinjiang region has seen substantial fixed asset investment growth due to the Western Development Policy, with over 2 trillion yuan allocated in transfer payments during the 14th Five-Year Plan period [5] - Major transportation infrastructure projects in Xinjiang, such as the New Tibet Railway and Duku Highway, are expected to drive demand for local construction firms and suppliers [5]

Investment Rating - The report maintains a "Positive" investment rating for the liquor industry [1] Core Insights - The report analyzes the adjustment phases of the liquor industry, comparing the current phase with the 2013-2016 period, highlighting that the current adjustment is primarily driven by a decline in business demand, which is less severe than the previous round [3] - It emphasizes that the purchasing power of consumers for high-end liquor has significantly improved compared to the lowest price point in 2014, indicating a potential for market recovery [3] - The report identifies three major changes in the liquor market: increased concentration among top companies, the rise of sauce-flavored liquor, and improved market value management practices among liquor companies [3] Summary by Sections 1. Historical Adjustment Phases - The liquor industry has entered a fifth year of adjustment since 2021, with significant impacts from the 2025 policy aimed at reducing government consumption [8] - The report reviews the historical context of the 2013-2016 adjustment, noting that the current environment is different but shares some similarities [8] 2. Current Adjustment Stage - The report indicates that the liquor industry has been in a downward adjustment since the third quarter of 2024, with expectations for recovery around the second quarter of 2026 [42] - It highlights that the current adjustment is less severe than the previous one, with a maximum revenue decline of 5% and profit decline of 8% compared to the previous maximums of 15% and 30% respectively [50] 3. Market Changes Impacting Investment - The concentration of the top six liquor companies has increased significantly, with their revenue share rising from 18.3% in 2013 to 48.1% in 2024, enhancing industry self-regulation [51] - The report notes that the expansion of sauce-flavored liquor production capacity has not yet translated into revenue share, but it is expected to gain traction in the future [3] - It discusses the evolving market value management strategies among liquor companies, including increased dividend payouts and share buybacks, which are expected to enhance investor returns [3]

Report Industry Investment Rating No relevant content provided. Core Viewpoints - The weekly technical analysis of Treasury bond futures shows that the rebound is ongoing, and any adjustment is still an opportunity to participate. The rebound of T and TL may continue. Observing TL2512, it may currently be in the third wave of the rebound. There may be an adjustment next week, with the extreme downside position to watch around 114.8 - 114.9. After the decline, there may still be a fifth - wave upward movement, with the final target temporarily set above 116 and near the 60 - day moving average [2]. - The Treasury bond futures data tracking indicates that all contracts have risen, and it is advisable to seize the opportunity to participate in the cash - and - carry strategy [3]. Summary by Directory 1. Weekly Technical Analysis 1.1 Pre - trend Review - This week, T2512 fell on Monday, turned strongly upward after hitting the bottom on Tuesday, then oscillated strongly, and reached a short - term high on Friday. The Treasury bond futures briefly declined at the beginning of the week and then continued to rebound. Currently, the weekly line is close to the MA20 moving average, and the daily line is above the moving average system. The rebound that started on September 25 may still be ongoing [9]. 1.2 Future Market Outlook - TL2512 showed significantly increased elasticity on Thursday and Friday this week. There may be an adjustment next week, with the extreme downside position to watch around 114.8 - 114.9. After that, there may be a fifth - wave upward movement, and the overall rebound target is above 116 and near the 60 - day moving average. From the perspective of the TL2512 trend, it may currently be in the third wave of the rebound. Next week, there may be a fourth - wave adjustment, and the extreme downside position to watch is around the high point of the first wave at 114.8 - 114.9. If it is supported at this level, it may continue to rebound in the fifth wave [10]. 2. Weekly Tracking of Treasury Bond Futures - All Treasury bond futures contracts rose this week. As of the close on October 17, the closing prices of the 2 - year, 5 - year, 10 - year, and 30 - year Treasury bond futures 2512 contracts were 102.378, 105.780, 108.295, and 115.87 yuan respectively, up 0.024, 0.130, 0.315, and 1.90 yuan from the previous week [16]. - The trading activity of Treasury bond futures increased overall this week. The average daily trading volume of the 2512 contracts of Treasury bond futures of each maturity increased overall compared with last week, except for TS. In terms of the trading volume/holding volume ratio, all increased except for TS. As of October 17, the holding volume of the 2512 contracts of Treasury bond futures increased across the board [16]. - As of October 17, the CTD net basis of the 2512 contracts of Treasury bond futures of each maturity declined across the board, with the CTD net basis of the 2 - year, 5 - year, 10 - year, and 30 - year 2512 contracts being - 0.03, - 0.05, - 0.05, and - 0.07 yuan respectively. In terms of IRR, the IRR corresponding to the CTD of the 2 - year, 5 - year, 10 - year, and 30 - year 2512 contracts were 1.56%, 1.71%, 1.72%, and 1.72% respectively, all of which increased. Currently, the IRR level is significantly higher than the funding rate, and overall, the value of participating in the cash - and - carry strategy has recovered, and one can seize the opportunity to participate. The spread performance of the 2512 - 2603 contracts was divergent this week, with the spreads of the 2 - year and 10 - year contracts rebounding and the spreads of the 5 - year and 30 - year contracts falling [21].

Report Industry Investment Rating - Not provided in the given content Core Viewpoints - **Important Information**: The first batch of fund Q3 reports were released, with the technology track remaining the "core position"; 8 new products were added to the personal pension fund list; many fund products ended fundraising early and conducted proportional配售 within the month [2] - **Market Review**: Last week (20251013 - 20251017), A - share market major broad - based indexes showed a downward trend. Overseas indexes mostly declined. For example, the Shanghai Composite Index fell 1.47% to 3839.76, and the Hang Seng Technology Index fell 7.98% [2] - **Fund Market Review**: Most active equity funds had negative returns last week, with a median return of - 4.18%. Financial real - estate and consumption theme funds performed well [2] - **ETF Fund Statistics**: The top three ETF categories in terms of performance last week were commodity futures (8.80%), international broad - based (0.38%), and bonds (0.11%). There were 585 ETFs with net capital inflows and 464 with net outflows [2] - **Fund Market Dynamics**: 37 public funds had new fund manager appointments, 10 new public funds were established with a total of 95.48 billion shares, 55 funds entered the issuance stage for the first time, and 41 funds were waiting to be issued [2] - **Equity Fund Issuance Tracking**: Last week, the issuance scale of equity funds reached 57.40 billion yuan, an increase of 48.88 billion yuan from the previous week. It is expected that new funds will bring incremental funds to industries such as electronics and power equipment and new energy [2] Summary by Directory 1 Important Information 1.1 Market Dynamics - **First Batch of Fund Q3 Reports**: As of October 17, 25 funds disclosed Q3 reports, including 18 equity funds. Technology - heavy funds performed well. Many fund managers still favored the growth technology sector [7] - **Gold Influx**: In the past 5 days, over 150 billion yuan flowed into the SGE Gold 9999 index. On October 16, commodity and Hong Kong market ETFs had net inflows [7][8] - **North Exchange Fund Dividends**: Many North Exchange funds made large - scale dividend distributions, such as the Wanjia North Exchange Huixuan Two - Year Fixed - Open Hybrid [8] - **Bond Fund Net Value Precision Adjustment**: In early October, bond funds had net outflows, and some fund managers increased the net value precision of bond funds to deal with large - scale redemptions [9] 1.2 Product Hotspots - **Personal Pension Fund Expansion**: On October 17, 8 new products were added to the personal pension fund list, including 5 index - enhanced funds, 2 FOF products, and 1 ETF connection fund [10] - **Early Fundraising End and Proportional Allocation**: In October, many funds ended fundraising early and some started proportional allocation, such as the E Fund Hong Kong Stock Connect Technology Hybrid [11] - **CSI A500ETF Anniversary**: Since its launch in 2024, the CSI A500 index - related products have a total scale of over 300 billion yuan, and the index has outperformed some broad - based indexes [13] 1.3 Overseas/Overseas Market - **Brazilian Theme QDII**: E Fund and China Asset Management may launch two Brazilian theme QDIIs, which will track the Ibovespa index [13][15] - **Emerging Market Product Returns**: Most emerging market investment products have achieved double - digit returns this year, and some have doubled [15] 2 Market Review - A - share major broad - based indexes declined last week, and overseas indexes mostly fell. The banking and coal industries had the highest gains [16][18] 3 Fund Market Review 3.1 Active Equity Fund Performance - In the past week, financial real - estate and consumption theme funds performed well; in the past three months, technology and cycle theme funds led; in the past year, technology and manufacturing theme funds were outstanding [21] 3.2 Top - Performing Fund Performance Statistics - The top - performing active equity fund last week was Minsheng Jiayin Financial Selection A, with a return of 6.15% [25] 4 ETF Fund Statistics 4.1 ETF Fund Performance - Last week, the top - performing ETF categories were commodity futures, international broad - based, and bonds. The top - five performing ETFs were also listed [27][29] 4.2 ETF Fund Capital Flow Statistics - Last week, the top categories with net capital inflows were commodity futures, technology, and financial real - estate, while A - share broad - based ETFs had the largest outflows [30] 4.3 ETF Fund Premium and Discount Statistics - As of October 17, the top three ETFs with premium rates were Huaxia Feed Soybean Meal Futures ETF, Bosera Hang Seng Technology ETF, etc.; the top three with discount rates were Jiaotong 180 Governance ETF, etc. [35] 5 Fund Market Dynamics 5.1 Fund Manager Changes - 37 public funds had new fund manager appointments, involving 28 fund managers from 21 fund management companies. 39 funds had fund manager departures [37][40] 5.2 Newly Established Funds Last Week - 10 new public funds were established, with a total of 95.48 billion shares. The most numerous type was partial - stock hybrid funds [43] 5.3 First - Issued Funds Last Week - 55 public funds entered the issuance stage for the first time. The most numerous fund management companies were China Europe, China Asset Management, Hua'an, and Huatai - PineBridge. The most numerous type was passive index funds [45] 5.4 Funds to be Issued - As of October 19, 41 public funds were waiting to be issued [2] 5.5 Equity Fund Issuance Tracking - Last week, the issuance scale of equity funds increased. There are still 270 new funds in the position - building period, with an estimated 589.99 billion yuan yet to be invested [2]

Core Insights - The defense and military industry index experienced a decline of -4.70% over the past week, ranking 23rd out of 31 in the Shenwan primary industry [7][41] - The current PE-TTM for the defense and military industry is 83.33, which is at the 76.67 percentile compared to the past decade, indicating a relatively high valuation level [12][15] - The report highlights significant individual stock performances, with North China Long Dragon leading with an increase of 8.71% over the past week, while Guorui Technology saw a decline of -14.00% [17][41] Industry and Stock Market Review - The defense and military industry index has shown a decline of -1.92% over the past month, ranking 11th out of 31 [9][41] - Over the past year, the industry index has increased by 16.91%, ranking 19th out of 31 [3][41] - The trading volume for the defense and military industry reached 310.8 billion yuan this week, a year-on-year decrease of -8.63% but a week-on-week increase of +128.08% [31][34] Important Company Announcements - The report includes various significant announcements from companies in the defense sector, such as strategic cooperation agreements and stock repurchase plans [38] Industry News - Indonesia confirmed its plan to purchase Chinese-made J-10 fighter jets, with a defense budget of at least 9 billion USD approved [40][41] - Successful launches of low-orbit satellite internet groups and the sixth batch of the Qianfan constellation were reported, indicating advancements in commercial aerospace [40][42] Investment Recommendations - The report suggests focusing on key investment themes such as military trade, commercial aerospace, unmanned equipment, military AI, and low-altitude economy [43]

Core Insights - The report maintains a positive outlook on the building materials sector, highlighting a shift in capital towards domestic demand-driven segments due to ongoing U.S.-China tariff tensions and a focus on defensive investments [4] - The competitive landscape within the consumer building materials sector is improving, with leading companies expected to gain market share as smaller firms exit the market due to financial strain [4] - The report emphasizes the potential for a recovery cycle in profitability for leading companies in the building materials sector, particularly in coatings and waterproofing segments, as price stabilization is observed [4] Market Performance - The building materials sector has shown a performance of -9% over the last 12 months, compared to the Shanghai Composite Index's -3% and the CSI 300's 4% [2][4] Recommendations - The report recommends prioritizing investments in leading companies within the building materials sector, specifically mentioning Sanke Tree, Oriental Yuhong, Rabbit Baby, and Keshun Co., as they are expected to benefit from the ongoing market consolidation [4] - For the cement sector, the report suggests a wait-and-see approach until supply-side improvements materialize, with a focus on Huaxin Cement and a watch on Shangfeng Cement and Tapai Group [4]

Report Industry Investment Rating There is no information regarding the report's industry investment rating provided in the content. Core Viewpoints - As of October 18, 2025, 117 listed companies have disclosed their Q3 earnings forecasts, the lowest in the past five years. About 84% of them announced positive news, similar to 2024. Most companies issued pre - increase announcements (60% of all forecasts). Only 10 convertible bond companies disclosed Q3 earnings forecasts, half the number of 2024, with 9 announcing positive news [2][6][14]. - Basic chemicals, electronics, non - ferrous metals, and machinery industries had more positive news. The non - ferrous metals and media industries showed significant improvement compared to 2024. Seven non - ferrous metal companies announced pre - increase, and 2 announced turnaround; 1 media company announced turnaround and 1 pre - increase [2][8]. - Four convertible bond listed companies, Luxshare, Limin, Bojun, and Downtow, reported positive Q3 earnings for two consecutive years. Luxshare expects a 20% - 25% net profit increase in Q3, Limin may see a year - on - year net profit increase of over 600%, Bojun expects a 50% - 80% net profit increase, and Downtow's Q3 profit may increase by over 30% [2][13][14]. - The market style may be switching, and geopolitical uncertainties increase market volatility. The risk appetite in the convertible bond market may have declined. Selecting high - quality convertible bonds during the earnings season may be a key strategy, especially those with consistently excellent performance [2][14]. Summaries by Directory 1. Q3 Earnings Forecasts: How to View the Convertible Bond Market - The number of listed companies disclosing Q3 earnings forecasts in 2025 is the lowest in the past five years, with a similar structure to 2024. The proportion of companies with positive news is about 84%, the same as in 2024. In the convertible bond market, only 10 companies disclosed forecasts, half the number of 2024, with 9 announcing positive news [2][6][14]. - Basic chemicals, electronics, non - ferrous metals, and machinery are industries with more positive news. Non - ferrous metals and media industries improved significantly compared to 2024. 15 companies mentioned AI contributions in their earnings forecasts, with 14 reporting positive results and most planning to increase AI investment [2][8][11]. - Four convertible bond listed companies had positive Q3 earnings for two consecutive years, with specific reasons for profit growth provided for each company [2][13][14]. 2. One - Week Market Performance - As of Friday's close, the Shanghai Composite Index closed at 3839.76, down 1.47% for the week; the CSI Convertible Bond Index closed at 474.22, down 2.35% for the week. The top - three rising industries in the stock market were banks (+4.99%), coal (+4.27%), and food and beverages (+0.85%), while electronics (-7.10%), media (-6.28%), and automobiles (-6.24%) declined [15]. - No new convertible bonds were listed this week. 45 convertible bonds rose, accounting for 11%. The top - five and bottom - five in terms of price changes are listed. 266 convertible bonds' conversion premium rates increased, accounting for 64%, and the top - five and bottom - five in terms of valuation changes are also listed [17]. 3. Major Shareholders' Convertible Bond Reductions - Nanjing Pharmaceutical announced a convertible bond reduction this week. A table shows the convertible bonds with high major shareholder holding ratios and their reduction status [25][26][27]. 4. Convertible Bond Issuance Progress - The primary - market approval process remains fast. Zhongqi Co., Ltd. (1.039 billion yuan), Mankun Technology (760 million yuan), and Huatong Cable (800 million yuan) have board proposals. Haitian Co., Ltd. (801 million yuan) has passed the shareholders' meeting, and Tianzhun Technology (872 million yuan) has received CSRC approval [27][28]. 5. Private EB Project Updates There were no progress updates on private EB projects this week [28]. 6. Style & Strategy: Large - Scale High - Rating Bonds Prevailed This Week - Using month - end rebalancing for back - testing and excluding bonds rated below A - and those with announced forced redemptions, large - scale high - rating convertible bonds prevailed this week. High - rating bonds had a 2.63pct excess return over low - rating bonds, large - scale bonds had a 1.89pct excess return over small - scale bonds, and equity - biased bonds had a - 8.24pct excess return over debt - biased bonds [29]. 7. One - Week Convertible Bond Valuation Performance: Convertible Bond Valuations Declined - The convertible bond market's 100 - yuan premium rate declined. As of the last trading day of the week, it closed at 29.31%, down 0.29% from the previous week, at the 86.5% historical percentile in the past six months and 93.6% in the past year. The median full - scope conversion premium rate increased by 0.78pct to 28.61%, and the market - value - weighted conversion premium rate (excluding banks) increased by 1.69pct to 41.46% [40]. - For equity - biased convertible bonds, the median conversion premium rate closed at 10.58%, down 1.12pct from the previous week, at the 80.6% historical percentile in the past six months. For debt - biased convertible bonds, the median pure - debt premium rate closed at 10.78%, down 1.43pct from the previous week, at the 71.4% historical percentile in the past six months [40]. - In terms of extreme pricing, as of the last trading day of the week, there was 1 convertible bond below par value, 0 below the bond floor, and 2 with a YTM greater than 3, at the 9.2%, 0%, and 6.7% historical percentiles since 2016 respectively. The median YTM of bank convertible bonds was - 3.97%, 5.84pct lower than the 3 - year AAA corporate bond yield; the median YTM of AA - to AA+ debt - biased convertible bonds was - 1.48%, 3.59pct lower than the 3 - year AA corporate bond yield [44]. - The adjusted 100 - yuan premium rate remained flat. After excluding factors such as bond nature and remaining term, it was at the 84.3% historical percentile in the past six months and 68.9% since 2018. Considering only the bond floor, it was at the 82.6% historical percentile in the past six months and 34.8% since 2018 [56].

1. Report Industry Investment Rating There is no information provided regarding the report industry investment rating. 2. Core Viewpoints of the Report - The bond market is still "widely bearish," but it is likely to be a bull market. The upper limit of bond market interest rates is clear. The 10 - year Treasury bond rate above 1.8% has absolute value, and the downward space of bond market interest rates is at least 20bp. There are opportunities for the narrowing of the spreads of ultra - long bonds and variety spreads [2]. - The logic of the upper limit of interest rates comes from the weak fundamentals, asset shortage, and the need to cooperate with fiscal policies. The large - scale purchase of 7 - 10y Treasury bonds by large banks in mid - September may reflect the policy intention of maintaining stability in the bond market [2][8]. - Regarding the lower limit of interest rates, the report is firmly bullish. The 1.7% is not an important resistance level. Interest rates are expected to reach new lows under the influence of factors such as the central bank's possible restart of Treasury bond trading, regulatory policies being less than expected, and cross - year allocation [11][12]. - The term spreads in the bond market since 2024 have generally widened, different from the previous narrowing trend. In the future, with the improvement of market sentiment, there will be opportunities for spread compression. The impact of the 500 billion yuan local government debt limit on the bond market is expected to be limited in the short term [3]. 3. Summary According to the Table of Contents 3.1 Is It a Sideways Market or a Bull Market? - There are still significant differences in the market. The short - term view of most investors is that the downward space of interest rates is limited. The lower limit of the 10 - year Treasury bond active bond rate may be 1.7%, and the upper limit is around the previous high of 1.83% [7]. - The long - term view believes that short - term Sino - US trade frictions are beneficial, and the negative factors in the third quarter are weakening. The short - term view believes that Sino - US relations may improve, the stock market is still strong, and regulatory policies will affect the bond market [7]. - The upper limit of interest rates: The 10 - year Treasury bond above 1.8% and the 30 - year Treasury bond above 2.1% have absolute allocation value. The upper limit comes from the weak fundamentals, asset shortage, and the large - scale purchase of 7 - 10y Treasury bonds by large banks in mid - September, which may be a manifestation of the central bank's intention to maintain stability in the bond market and cooperate with fiscal policies [8]. - The lower limit of interest rates: The report is firmly bullish. The 1.7% is not an important resistance level. Interest rates are expected to reach new lows under the influence of factors such as the central bank's possible restart of Treasury bond trading, regulatory policies being less than expected, and cross - year allocation. In extreme cases, the 10 - year Treasury bond rate can refer to the pricing at the beginning of this year plus points, that is, OMO + 10bp [11][12]. 3.2 How to View Spreads in a Sideways Market? - By tracing the sideways markets since 2022 with the 10 - year Treasury bond yield as the standard, 7 time periods are sorted out. Since 2024, the term spreads in the sideways market have generally widened, mainly because the bond bull market since 2024 is usually accompanied by supply pressure or the central bank's attention to long - term interest rates, making the mid - short end relatively safer and more certain [19][24]. - In terms of variety spreads, the spread between policy - financial bonds and Treasury bonds usually narrows, especially at the long end. The credit spreads have decreased significantly in most sideways markets [25]. - Since the end of August 2025, the spread between 5 - year and 2 - year Treasury bonds has declined, while the spreads between 10 - year and 5 - year, and 30 - year and 10 - year Treasury bonds have increased, and the variety spreads have increased rapidly. The reasons include large - scale purchases of medium - term Treasury bonds by large state - owned banks, the reduction of fund duration by public funds, and the weak buying of ultra - long bonds by large and medium - sized banks [31][33]. - Looking forward, the 30 - year Treasury bond rate has a greater downward space, and the variety spreads may also narrow. Insurance funds may increase their purchases of ultra - long bonds when the Treasury bond rate rebounds above 2.1%. With the improvement of bond market sentiment and the end of the cross - quarter period, the buying power of funds and rural commercial banks may return, driving the compression of the spread between policy - financial bonds and Treasury bonds [36]. 3.3 How to View the Impact of 500 Billion Yuan of Local Government Debt Balance on the Bond Market? - In the absence of other incremental policy linkages, the impact of 50 billion yuan of special bonds on the bond market is limited. In 2022, the interest rate fluctuated upward due to a series of incremental policies, including fiscal, monetary, and structural policies [37][38]. - This 500 billion yuan of funds is likely to be issued in the form of new special bonds. Currently, the balance of general bonds is not large, and the use of this fund is more suitable for new special bonds [43]. 3.4 Bond Market Interest Rates First Rose and Then Fell - This week, the central bank's open - market operations changed from net investment to net withdrawal, but the liquidity in the market became looser. The bond market yield curve flattened as a whole, and the 10 - year Treasury bond yield first rose and then fell, rising 0.40bp to 1.82% [3][45]. - The reasons for the fluctuations in bond market interest rates include factors such as "TACO trading," good export performance, increased redemption pressure, market speculation on public fund fee reform, and the possible issuance of local government bonds in advance in 2026 [45]. 3.5 The Scale of Wealth Management Products Slightly Increased - As of October 12, the scale of existing wealth management products reached 30.9 trillion yuan, with a weekly increase of 120.652 billion yuan. From October 6 to October 12, the newly issued wealth management products totaled 14.68 billion yuan [55]. - In the second week of October, the scale of fixed - income products rebounded. By product type, the scale of cash - management products increased by 15.8 billion yuan, and the scale of fixed - income products increased by 41.7 billion yuan. By product risk level, the scale of first - level (low - risk) products increased by 5 billion yuan [59][60]. - The net - breaking rate of wealth management products decreased slightly last week. As of October 15, the average 7 - day annualized yield of 370 money funds was 1.05%, and the average 7 - day annualized yield of 265 cash - management products was 1.35% [60][62]. 3.6 Duration - This week, the duration of public funds decreased at first and then increased. From October 13 to October 17, the duration of public funds increased by 0.035 to 2.382 compared with October 10, and the weekly average was 2.364 [64]. - This week, the divergence of duration decreased, and the market's consensus expectation increased slightly. On October 17, the divergence of public fund duration decreased by 0.014 to 0.321 compared with October 10 [64].