Earnings Review: 3Q25 earnings slightly ahead of GSe; full-year revenue guidance raised on robust order momentum 29 October 2025 | 6:52PM HKT Equity Research Pharmaron (3759.HK) BUY | 3759.HK | 12m Price Target: HK$30.00 | Price: HK$24.96 | Upside: 20.2% | | --- | --- | --- | --- | | 300759.SZ | 12m Price Target: Rmb38.50 | Price: Rmb31.97 | Upside: 20.4% | Pharmaron reported 3Q25 revenue of Rmb3.65bn, up +13.4% y/y and +9.1% q/q, marginally above GSe of Rmb3.48bn. The topline was driven by sustained moment ...

Economic Research Understanding Technical Analysis 更多一手调研纪要和海外投行研报数据加V：shuimu2026 更多一手调研纪要和海外投行研报数据加V：shuimu2026 更多一手调研纪要和海外投行研报数据加V：shuimu2026 更多一手调研纪要和海外投行研报数据加V：shuimu2026 更多一手调研纪要和海外投行研报数据加V：shuimu2026 更多一手调研纪要和海外投行研报数据加V：shuimu2026 Global Markets Economic Research Editorís email address: kevin.edgeley@gs.com Important disclosures appear on the back cover of this publication. 更多资料加入知识星球：水木调研纪要 关注公众号：水木纪要 Global Markets Economic Research Jim OíNeill, M.D. & Head of Global Economic Research 1 Global Resea ...

Investment Rating - The report maintains a "Buy" rating for CMOC Group (3993.HK) with a 12-month price target of HK$19.00, representing an upside of 17.3% from the current price of HK$16.20 [1][2]. Core Insights - CMOC reported a net profit of Rmb5.61 billion for 3Q25, reflecting a year-on-year increase of 96%, with earnings per share (EPS) rising to Rmb0.262, up 98% year-on-year [1]. - The recurring profit growth is expected to continue, driven by rising copper prices and volume growth, with a projected compound annual growth rate (CAGR) of 38% for 2025-26E [2]. - The company has revised its earnings estimates upward by 8-32% for 2025-27E, reflecting a positive outlook on copper prices and the impact of new cobalt export quotas from the DRC [2]. Financial Performance - For the first nine months of 2025, CMOC's recurring net profit reached Rmb14.1 billion, accounting for 75% of the full-year estimate [1]. - The company expects to achieve a copper output target of 1 million tons by 2028, supported by the Cangrejos gold/copper project, which is anticipated to further enhance earnings growth [2][29]. - The report indicates that CMOC's current H-share price implies a copper price of US$8,500/t, which is lower than the spot price of US$10,900/t, suggesting potential for price appreciation if targets are met [2]. Production and Operations - CMOC's copper output in the DRC reached 543kt in 9M25, a 14% increase year-on-year, while cobalt output was 88kt, up 3.8% year-on-year [26]. - The DRC government has introduced a cobalt export quota system, allowing CMOC to export 6.5kt for the remainder of 2025 and 31.2kt annually for 2026-27E, which is expected to improve gross profit for cobalt significantly despite lower sales volume [27]. - The acquisition of Lumina Gold for C$581 million is expected to enhance CMOC's net profit by 13.1% by 2030, with significant gold and copper reserves identified at the Cangrejos project [28]. Valuation Metrics - The report provides updated revenue and earnings estimates, with total revenue projected at Rmb213,028.7 million for 2024 and Rmb192,354.5 million for 2025E [6]. - The price-to-earnings (P/E) ratio is forecasted to be 9.2 for 2024 and 15.5 for 2025E, while the price-to-book (P/B) ratio is expected to be 1.8 for 2024 and 3.7 for 2025E [12]. - The report indicates a free cash flow yield of 19.6% for 2024, which is expected to decrease to 6.6% in subsequent years [12].

Investment Rating - The report indicates a bearish sentiment in the oil market, particularly with significant short positioning in Brent Crude [3][5]. Core Insights - Crude oil prices have surged following the announcement of sanctions on Russian oil giants by the Trump administration, raising questions about future price movements [1][13]. - Managed Money shorts in Brent Crude reached a 90% rank on a two-year lookback, indicating a strong bearish posture among traders [3][5]. - The report highlights that the recent price movements and trader behaviors suggest a potential for larger covering flows if the recent price increase holds [16][18]. Summary by Sections - **Market Reaction**: Following the sanctions on Russian oil producers, December Brent crude saw an intraday high increase of 5.5% on October 23rd, with significant movements in spreads and open interest [13][11]. - **Trader Positioning**: The Commitment of Traders data shows a substantial amount of Managed Money short positions, with a cumulative increase of $3.3 billion over four weeks [3][5]. - **Market Dynamics**: The report notes that the rolling six-month correlation between Managed Money spreads and front-term structure remains negative, indicating that shorts dominate the market [10]. Additionally, reports of India reducing purchases of Russian oil have contributed to market unease [10].

Investment Rating - The report indicates a cautious outlook on the retail sector amidst a choppy de-grossing market environment, suggesting that retail remains a dominant force despite the volatility [1][3]. Core Insights - Retail trading activity has surged, with retail investors accounting for over 16% of the total volume in S&P 500 stocks, marking a five-year high [7][9]. - The market is increasingly narrative-driven, with traders seeking compelling stories and catalysts to guide their investments [8][12]. - The volume of stocks executed by off-exchange venues, such as those serving retail platforms like Robinhood, is projected to reach 50% of total trading volume for the first time this year [9][12]. - Individual amateur investors are gravitating towards lightly regulated markets, with OTC Markets seeing an average monthly trading volume of approximately $59 billion, nearing the peak levels observed during the meme-stock frenzy [12][9]. - The report highlights a divergence in risk appetite, with retail investors remaining risk-seeking while institutional investors have adopted a more cautious stance [13][15]. Summary by Sections Trading Activity - On a recent trading day, 25.2 billion shares were traded across US equity exchanges, significantly above the year-to-date average of 17.2 billion shares [3][4]. - The top 10 stocks by trading volume accounted for approximately 8 billion shares, or 32% of the total market volume, with a majority being penny stocks favored by retail investors [4][7]. Market Sentiment - The current market sentiment is characterized by a high level of gross leverage and constrained net positions, indicating a cautious approach among institutional investors [22][23]. - The report notes that the unprofitable tech sector is experiencing a sharp correction, with some stocks, like Beyond Meat, showing significant reversals [28][29]. Earnings and Economic Indicators - Overall earnings remain supportive, but market reactions to earnings reports are becoming increasingly critical, as investors appear to be taking profits during the earnings season [29][31]. - The bond market has stabilized despite ongoing fiscal excess, with both nominal and real yields compressing at the long end, which is seen as bullish for equity multiples [33][34].

Investment Rating - The report maintains an "Overweight" rating for China in a regional context, favoring North Asia markets with a moderately cyclical sector emphasis [85]. Core Insights - The MSCI China index has rebounded 80% from its cycle lows in late 2022, with expectations for a sustained uptrend, forecasting key indexes to rise 30-40% and reach all-time highs by the end of 2027 [2]. - The report highlights several bull market strategies, including buying on dips and focusing on alpha through specific themes such as Chinese Prominent 10, China AI, Going Global Leaders, anti-involution beneficiaries, and A-share small caps [3][88]. - A pro-market policy environment is expected to persist, with measures aimed at stimulating demand and enhancing shareholder returns, alongside easing industry regulations [4][34]. Summary by Sections Market Outlook - The report forecasts a 30% rise in Chinese equities over the next two years, driven by low-teen trend profit growth and moderate PE expansion [16][35]. - Earnings growth is anticipated to accelerate to 12%, supported by AI advancements, anti-involution measures, and the "Going Global" strategy [35]. Valuation and Investment Themes - Current valuations are seen as attractive, with the right tail from AI and liquidity overshoot priced at mid-range index PEs, and significant discounts to global equities [7][62]. - The report identifies key themes for investment, including AI, anti-involution, and "Going Global," which are expected to drive profit reflation and enhance competitiveness [44][47]. Capital Flows and Investor Sentiment - There is a structural migration of Chinese capital towards equities, with trillions of dollars in potential asset reallocation flows expected to support this trend [76][79]. - Despite conservative positioning among foreign investors, retail sentiment remains subdued compared to previous euphoric levels, indicating potential for future growth [82][79]. Sector Performance - The report emphasizes that alpha opportunities are abundant along sector and thematic axes, with notable performance in themes such as Going Global Leaders and China AI [93][96].

Investment Rating - The report indicates a bullish outlook for the U.S. stock market in November, driven by potential economic acceleration and significant corporate earnings reports from major tech companies [1][14]. Core Insights - Market leadership is fluctuating, with retail investors outperforming institutional investors, leading to increased caution among market participants [2]. - The private credit sector is experiencing significant inflows, but concerns about loan standards and potential fraud have emerged, suggesting a need for long-term repricing [3]. - The geopolitical landscape, particularly U.S.-China relations, is a focal point, with an upcoming meeting seen as crucial for economic stability [5]. - The volatility in the stock market is notable, with a divergence between implied and actual volatility, creating buying opportunities [6][7]. - Developments in artificial intelligence are expected to play a decisive role in stock market trends, potentially driving significant gains [8]. - Emerging market currencies, especially those with high real yields, are attracting investor interest as a shift away from G10 currencies occurs due to fiscal issues [10][11]. Summary by Sections Market Sentiment - Recent market sentiment is cautious, particularly in equity accounts, with reports indicating some of the worst performance of the year [2]. - The cautious sentiment is attributed to volatility in market leadership and a preference for profit protection over aggressive investment strategies [2]. Private Credit Sector - The private credit sector has seen substantial capital inflows, but there are emerging concerns regarding loan standards and potential fraud, indicating a need for reevaluation [3]. Interest Rate Outlook - There is a divergence in views on interest rates, but a 3% yield on 10-year Treasury bonds is considered reasonable, with expectations of economic acceleration in November due to tax refunds [4]. Geopolitical Factors - U.S.-China relations are critical, with an upcoming meeting viewed as a pivotal event that could lead to agreements beneficial for both economies [5]. Stock Market Volatility - Recent stock market volatility has been significant, with the VIX index showing notable fluctuations, creating opportunities for investors to re-enter the market [6][7]. Artificial Intelligence Impact - The development of artificial intelligence is highlighted as a key factor that could drive stock prices higher, influencing overall market performance [8]. Emerging Markets - Emerging market currencies are gaining traction among investors, particularly those with high real yields, as concerns about G10 fiscal issues prompt a shift in investment strategies [10][11]. Investor Attitudes - Investors are increasingly moving away from the dollar towards other asset classes, including gold and cryptocurrencies, amid concerns over credit events in various markets [12]. China Market Dynamics - The rise in the Chinese stock market and commodity prices is influencing the yuan's exchange rate, with expectations of further gains in the stock market [13]. U.S. Stock Market Outlook - There is a general expectation for the U.S. stock market to rise before year-end, with upcoming tech earnings seen as a potential catalyst for market movement [14].

Investment Rating - The report indicates a negative sentiment for US equities with a sentiment indicator reading of -0.6, suggesting a cautious outlook for the market [5]. Core Insights - Despite recent market anxiety driven by de-grossing and tariff concerns, the positioning in the market has returned to a more favorable state, with elevated panic indicators that are not widespread. The medium-term growth outlook into 2026 remains positive, supported by policy, strong balance sheets, and increased investment in AI [2][6]. - The sentiment indicator data shows that 2025 stands out in terms of US equity positioning and sentiment, particularly when compared to 2024 [6][7]. - The report highlights that while certain sectors of the equity market appear well-subscribed, the overall market sentiment remains relatively unloved due to past policy uncertainties [14]. Summary by Sections Sentiment Indicator Analysis - The sentiment indicator tracks investor positioning across over 80% of the US equity market owned by institutional, retail, and foreign investors [13]. - Historical data shows that the best years for sentiment readings include 2024 with +1.00 and a 23% increase in the S&P 500, while the worst year was 2022 with -1.20 and a 19% decrease in the S&P 500 [10][11]. Technical Analysis - Trend-following funds are heavily net long across major equity futures, with only a marginal reduction in exposure recently, estimated at $2 billion globally. The model-implied flows remain modest, indicating limited risk of liquidity issues unless a significant market shock occurs [15][18].

CHINA METALS & MINING Growth outlook reiterated - feedback from Zijin and CMOC in LME Week GS Global Metals & Mining Conference We hosted Zijin Mining and CMOC C-level management fireside chats and investors groups on Oct 14-15th in London, during the LME week GS Global Metals & Mining Conference. The discussions were centered around 1) production growth outlook for copper and gold, 2) thoughts around their M&A strategy and preference, and 3) factors driving their operational strength. Zijin and CMOC has de ...

Investment Rating - The report maintains a "responsibly bullish" outlook for Q4, with increased confidence for November and December compared to the current month [19]. Core Insights - The market has recently undergone a significant round of tactical derisking, influenced by renewed US-China tensions and specific events within the US credit market [15][16]. - Despite the volatility, good earnings, particularly from large banks, have been rewarded, and the US macroeconomic indicators remain decent, with 217k jobless claims reported [7]. - The S&P 500 index managed to rise by 1.7% after testing the 50-day moving average, indicating resilience in the market [10]. - Retail investors have shown confidence, with a notable inflow of $28 billion into equity funds during the week [21]. Market Dynamics - The trading community significantly reduced risk last Friday, leading to the largest selling of US and global equities since April, alongside an increase in macro shorts [20]. - The market has lost some support points, and fast money has quickly reduced positions, indicating a shift in sentiment [20][22]. - The report highlights that while various market participants still hold significant positions, the market has cleaned up some risk over the past two weeks, suggesting potential for technical improvement as October progresses [22]. Geopolitical Context - The renewed tensions between the US and China regarding tariffs have caught the market off guard, leading to fluctuations in sentiment [23][25]. - Although local confidence has been dented, the expectation of a resolution suggests that the impact on stocks may not be lasting [26]. Sector Analysis - In the technology sector, companies like AVGO and ASML have reported strong earnings, with TSMC highlighting robust AI demand, indicating a positive outlook for AI-related investments [27][28]. - The report notes that AI investment as a share of US GDP remains below 1%, suggesting room for growth compared to previous technology cycles [46]. Multi-Manager Trends - The multi-manager segment has seen a resurgence, with total assets reaching an all-time high of $430 billion, indicating strong interest and growth in this area [53][54]. - Multi-strategy managers have outperformed their equity and macro-focused peers, driven by diversified return streams that help mitigate volatility [57].