Investment Rating - The report does not explicitly provide an investment rating for the company or industry analyzed [1]. Core Insights - The neutral real rate (r*) is a crucial benchmark for monetary policy and financial markets, representing the equilibrium real policy rate that neither stimulates nor contracts economic growth [3][4]. - Recent estimates suggest that the neutral real rates in the US and other major developed economies are higher than previously thought, particularly post-pandemic [1]. - The study highlights that the differences in neutral real rates across countries are primarily driven by GDP per capita, inflation rates, and current account balances, with specific impacts quantified [1][17]. Summary by Relevant Sections Neutral Real Rate Estimation - The neutral real rate can be estimated through economic models or inferred from financial market pricing, with market-based measures being particularly useful for cross-country comparisons [4][5][6]. - The analysis includes 12 developed and 24 emerging market economies, using data back to 2000 to derive neutral real rate estimates [6]. Cross-Country Differences - The report identifies that the neutral real rates in emerging markets (EM) and developed markets (DM) have moved in tandem over the past 25 years, with fluctuations largely driven by changes in US/global r* [9][10]. - Factors affecting country-specific risk premia, such as economic development levels and inflation volatility, play a significant role in explaining cross-country differences in r* [11][12]. Key Drivers of Neutral Real Rates - The analysis finds that a 10 percentage point increase in GDP per capita lowers neutral real rates by 12 basis points, while a 1 percentage point increase in average inflation raises them by 33 basis points [17]. - Improvements in current account balances lead to a decrease in neutral real rates, with a 1 percentage point improvement lowering rates by 7 basis points in general and by 20 basis points in emerging economies [17]. Macroeconomic Stability - The findings suggest that macroeconomic stability can yield high returns, with lower inflation and improved external balances providing pathways to sustainably lower interest rates and capital costs [19][20]. - The case of Turkey illustrates that strong economic growth does not necessarily correlate with high equilibrium rates, indicating that effective macroeconomic policies can lead to lower real interest rates [21].

Election Dynamics and Polling Trends - The presidential race has shifted significantly, with Vice President Harris now leading by around 3pp nationally, up from a 1pp lead earlier [4][6] - Harris has gained ground in key swing states, particularly in Sunbelt states like Arizona, Georgia, Nevada, and North Carolina, where her support has increased by 5pp on average [6] - The race remains highly competitive, with 7 swing states worth a combined 100 electoral votes now within roughly 2pp of even [6][7] Policy Implications of Election Outcomes - A Democratic sweep could lead to significant fiscal legislation in 2025, including higher corporate and high-income taxes, expanded family benefits, and new welfare programs [2] - In a divided government scenario, policy changes would be more limited, with only the expiration of certain 2017 tax cuts for high-income individuals likely to occur [2] - Harris is expected to release an economic plan soon, which may resemble Biden's budget proposal but with additional spending on areas like healthcare, childcare, and housing [40] Congressional and Senate Outlook - Democrats hold a slight 0.8pp lead in the generic ballot for the House, but the Senate remains highly competitive, with Democrats likely to lose Sen Manchin's seat in West Virginia [30][35] - Prediction markets now favor a Harris win with divided government as the most likely outcome, overtaking the previous consensus of a Republican sweep [37][38] - A Democratic House and Republican Senate would likely shift the political center slightly to the left, given the Senate's historical tendency to operate closer to the center [39] Economic and Market Influences - Economic indicators like GDP growth, consumption, and payrolls have a stronger relationship with election outcomes than equity market moves, particularly earlier in the election year [19][22] - A rise in the unemployment rate could negatively impact the incumbent party, with each 0.1pp increase associated with a 0.4pp reduction in the Democratic vote share [23] - Voters' trust in handling the economy remains mixed, with recent polls showing Harris gaining a slim advantage, though Trump still leads in some key states [26][27]

Investment Rating - The report assigns a "Buy" rating to Mindray Medical (300760.SZ) and a "Neutral" rating to United Imaging (688271.SS) [21][22]. Core Insights - The report indicates that the procurement amount for major medical devices in China is gradually improving, although it has not yet reached a turning point. The procurement amounts for five out of seven tracked medical devices increased month-on-month in July 2024, while year-on-year growth remains negative for all seven devices [5][6]. - The report anticipates that market growth will normalize in the second half of 2024 and into 2025, driven by a reduction in the impact of anti-corruption measures [5][6]. - Mindray Medical is expected to benefit from multiple growth drivers, including a recovery in procurement activities and the latest developments in medical equipment update policies [21]. - United Imaging is positioned to lead the domestic replacement process in medical imaging equipment, with significant market share growth expected in MRI and CT devices by 2032 [22]. Summary by Sections Mindray Medical - Mindray Medical is a leading medical device manufacturer in China, focusing on patient monitoring systems, medical imaging, and in vitro diagnostics. Domestic market revenue accounted for 61% of total revenue in 2023 [21]. - The stock is currently trading below its five-year average P/E ratio, primarily due to policy risks. The company is expected to maintain its market leadership due to a strong product portfolio and competitive pricing [21]. - The 12-month price target for Mindray Medical is set at RMB 450, with an implied upside of 73.2% from the current price of RMB 259.78 [25]. United Imaging - United Imaging is recognized as a leader in medical imaging equipment in China, with a projected market size increase from RMB 53.5 billion in 2021 to RMB 101 billion by 2032 [22]. - The company is expected to capture significant market share in MRI and CT devices, with annual revenue growth projected at 18.6% over the next 11 years [22]. - The 12-month price target for United Imaging is RMB 149, with an implied upside of 29.4% from the current price of RMB 115.13 [26].

2131d4eaf4cb4d50b1d51c8af07b64b4 2024年8月12日 | 6:31PM EDT 美国经济日评: 7月份CPI前瞻 | --- | --- | |-------|---------------------------------------------------------------------| | | | | n | Jan Hatzius +1(212)902-0394 \| jan.hatzius@gs.com 高盛集团 | | | Alec Phillips +1(202)637-3746 \| alec.phillips@gs.com 高盛集团 | | n | David Mericle +1(212)357-2619 \| david.mericle@gs.com 高盛集团 | | | Ronnie Walker +1(917)343-4543 \| ronnie.walker@gs.com 高盛集团 | | | Manuel Abecasis +1(212)902-8357 \| manuel.abecasis@gs.com 高盛集团 | | n | Tim ...

Investment Rating - The investment rating for Hongfa Technology (600885.SS) is "Buy" with a 12-month price target of RMB 37.3, indicating an upside potential of 33.2% from the current price of RMB 28.01 [8][10][11]. Core Insights - Hongfa Technology reported Q2 2024 results that met expectations, with revenue, gross profit, EBIT, and net profit showing year-on-year increases of 11%, 7%, 1%, and 28% respectively. The company raised its revenue guidance for 2024 from a growth of 7-13% to 10-15% [1][4][9]. - The company is expected to benefit from strong order momentum, particularly in the high-voltage direct current (HVDC) relay segment, which is primarily used in new energy vehicles [1][10]. - The automotive relay segment outperformed expectations in the first half of 2024, with revenue growth of 36% year-on-year, driven by domestic brands and a significant increase in global market share [2][4][9]. Revenue Breakdown by Segment - **HVDC Relay**: Revenue for the first half of 2024 reached RMB 17.50 billion, growing 31% year-on-year, with a strong performance in the new energy vehicle sector [1][4]. - **Automotive Relay**: Revenue for the first half of 2024 was RMB 11.18 billion, up 36% year-on-year, with expectations of a 22% growth for the full year [2][4]. - **Power Relay**: Revenue for the first half of 2024 was RMB 11.13 billion, reflecting a 20% year-on-year increase, supported by strong demand from the State Grid and overseas markets [2][4]. - **Home Appliance Power Relay**: Revenue for the first half of 2024 was RMB 16.88 billion, with a growth of 7% year-on-year, although growth was below industry levels due to price competition [4][9]. - **Industrial Control Relay**: Revenue for the first half of 2024 was RMB 3.86 billion, showing a slight decline of 3% year-on-year, but a recovery is anticipated in the second half [4][9]. Financial Performance - The company achieved a gross profit margin of 34.6% in Q2 2024, a decrease of 1 percentage point year-on-year, attributed to rising silver and copper prices, but production efficiency improvements are expected to stabilize margins in the second half [5][10]. - Operating cash flow was RMB 12.23 billion, which is 2.5 times the net profit, indicating strong cash generation capabilities [5][10]. Market Position and Outlook - Hongfa Technology holds a leading position in the global relay market with a market share of 23% as of 2023, and is expected to continue expanding its market share driven by technological advantages in automotive, home appliance, and power sectors [9][10]. - The company is well-positioned to benefit from the electrification of vehicles and the increasing demand for smart meters as the global power grid undergoes upgrades [10][11].

Investment Rating - The report maintains a year-end 2024 target for the S&P 500 index at 5600, representing an 8% increase from current levels [3]. Core Insights - The recent sell-off in the US equity market has been attributed to concerns over the sustainability of economic growth, with the S&P 500 index experiencing a 6% decline over three days [1]. - Despite the downturn, the S&P 500 index remains 9% higher than at the beginning of the year, indicating resilience in the overall market [1]. - Historical data suggests that buying the S&P 500 after a 5% sell-off has typically resulted in positive returns, with a median return of 6% over the following three months [4]. - The report highlights a significant rotation from cyclical to defensive stocks, reflecting investor sentiment amid economic uncertainty [9]. - The expectation of aggressive interest rate cuts by the Federal Reserve in 2024 is likely to benefit defensive sectors, which historically outperform during such periods [13]. Summary by Sections Market Overview - The S&P 500 index has seen a sharp decline, but the overall level remains above the start of the year, indicating a potential buying opportunity [1][3]. - The report notes that the current P/E multiple of the S&P 500 is 20x, consistent with historical averages [3]. Economic Growth - The report forecasts US real GDP growth of 2.7% in 2024 and 2.3% in 2025, suggesting a stable economic environment despite recent market volatility [9]. Sector Performance - Defensive sectors such as Utilities and Consumer Staples are expected to perform well as the Fed begins to cut interest rates, with historical data supporting this trend [13][16]. - The report identifies a basket of Stable Growth stocks as an attractive investment strategy during periods of economic deceleration, with these stocks historically outperforming the S&P 500 [16][19]. Valuation Insights - Mega-cap tech stocks have seen a decline in valuations, with their P/E multiple dropping from 32x to 27x, yet still above the 10-year median of 24x [23]. - The report indicates that the median P/E for Stable Growth stocks is 24% higher than the median S&P 500 stock, but this premium is below historical peaks [19]. Small Caps - The Russell 2000 index is expected to be more sensitive to economic growth than interest rate changes, with a significant portion of its companies being unprofitable [25][27].

2024年8月7日 | 3:45PM CST 2131d4eaf4cb4d50b1d51c8af07b64b4 福耀玻璃 (600660.SS/3606.HK) 2Q24业绩分析：领先的销量增长、均价改善以 及利润率上升推动业绩大幅好于预期；买入 福耀玻璃公布的2024年二季度业绩大幅超出我们和市场的预测（请参见我们基于业绩 快报的简要分析）。福耀玻璃表示，显著超预期的业绩表现主要得益于销量增速领 先、均价提升和利润率提高，我们认为这些因素在未来的经营中都具有可持续性。我 们在本文中具体分析了管理层在业绩说明会上阐述的四大利好因素，我们认为它们也 为持续的业务扩张奠定了基础：1）美国工厂最新情况：管理层重申调查对象是第三方 劳务公司，而非福耀美国，管理层认为福耀在美国运营合规，遵守当地法律法规；因 此，其扩大美国生产的业务战略保持不变；2）销量增长领先，福耀玻璃2024年上半 年汽车玻璃销量同比增长16%，而全球汽车销量同比增速不到1%；管理层预计日后将 延续类似的增长势头；3）销售均价提升符合预期，福耀玻璃销售均价同比上涨 8.3%，管理层表示有清晰的可预见性显示未来5年均价有望同比上涨7%-8%；4）国内 ...

Investment Rating - The investment rating for Joyoung Co. (002242.SZ) is "Sell" with a 12-month price target of RMB 9.4, indicating a downside potential of 9.6% from the current price of RMB 10.4 [5][6]. Core Views - The report suggests that the current valuation of Joyoung Co. does not adequately reflect several downside risks, including weak domestic demand for small appliances, intensified competition affecting profit margins, and slowing growth in overseas revenue [5][6]. - The revenue forecasts for 2024-2026 have been slightly adjusted downwards by 1-2% to reflect the latest industry trends, with expected revenues of RMB 9.6 billion in 2024, RMB 10.2 billion in 2025, and RMB 10.9 billion in 2026 [2][3][6]. Financial Summary - Revenue for 2024 is projected at RMB 9,629 million, with a year-on-year growth of 0.2%. For 2025 and 2026, revenues are expected to be RMB 10,230 million and RMB 10,873 million, respectively, reflecting growth rates of 6.2% and 6.3% [2][3]. - The gross profit margin (GPM) is expected to be 26.9% in 2024, with slight improvements to 27.1% in 2025 and 27.3% in 2026 [2][3]. - Net income is forecasted to be RMB 449 million in 2024, RMB 493 million in 2025, and RMB 549 million in 2026, with year-on-year growth rates of 15.5%, 9.7%, and 11.4% respectively [2][3]. - Earnings per share (EPS) are projected to be RMB 0.59 in 2024, RMB 0.64 in 2025, and RMB 0.72 in 2026, with slight adjustments from previous estimates [2][3][6]. Key Assumptions - The report highlights that the small appliance market remains vulnerable to consumer spending trends, with potential risks of consumption downgrade due to the discretionary nature of these products [5]. - The competitive landscape in the domestic market is expected to intensify, which may further pressure profit margins [5].

Industry Overview - The report focuses on seven key industries in China that contribute 22% to GDP growth, with five industries currently operating at overcapacity, leading to zero or negative cash margins for over 50% of their capacity [1] - The industries analyzed include solar modules, lithium batteries, electric vehicles, power semiconductors (IGBT), construction machinery, air conditioners, and steel [5][6] - China's global supply share in these industries ranges from 66% to 86%, with significant export growth observed from 2020 to 2023, particularly in lithium batteries (720% growth) and electric vehicles (670% growth) [8][22] Supply-Demand Imbalance - Five out of the seven industries have China's capacity exceeding global demand, with solar modules at 200% and lithium batteries at 150% of global demand [10][21] - Capacity utilization rates in 2023 ranged from 30% to 87%, with solar modules at 44% and electric vehicles at 54% [8][21] - Over 50% of the supply in most industries operated at zero or negative cash margins in Q1 2024, with solar modules and steel being the worst performers [31][37] Cyclical Inflection Points - The report identifies solar modules and lithium batteries as industries closest to a cyclical inflection point due to negative cash margins and reduced capex plans, while electric vehicles and power semiconductors are further away [1][11] - Capex revisions over the past 12 months show significant cuts in lithium batteries (-41% for 2024E) and solar modules (-5% for 2024E), while power semiconductors saw a 130% increase in capex plans [33][37] - The tipping point for capex adjustments is expected when over 50% of the supply is in net debt and EBITDA interest coverage falls below 5x, with solar modules and lithium batteries likely to reach this point sooner [37][39] Global Market Impact - China's share in ex-China markets is expected to stagnate or decline, with solar modules and lithium batteries potentially losing 4-19% of their market share by 2028 [42][43] - Chinese producers are increasingly building capacity outside China, with lithium batteries and electric vehicles leading this trend, particularly in the US and Europe [40][43] - Trade tensions, particularly with the US and EU, pose risks to China's exports, with 40-60% of solar modules, lithium batteries, and electric vehicles exported to these regions [24][26] Industry-Specific Insights - **Solar Modules**: China's capacity is 200% of global demand, with a 46% price decline in Q1 2024. The industry is expected to see a cyclical bottom by 2025, with one-third of capacity likely to shut down [66][67] - **Electric Vehicles**: China's capacity is 120% of global demand, with 42% of exports going to the US and EU. The industry is not yet at a tipping point, with 50% of firms still generating positive cash margins [71][72] - **Lithium Batteries**: China's capacity is 150% of global demand, with a 41% capex cut for 2024E. The industry is close to a tipping point, with significant consolidation potential [11][33] - **Power Semiconductors (IGBT)**: Capex plans have increased by 130% for 2024E, but the industry is 2-3 years away from a cyclical inflection point due to strong demand and high capex [33][37] - **Steel, Construction Machinery, and Air Conditioners**: These industries are expected to remain structurally oversupplied, with limited cyclical improvements [11][45]

1公众学： 本本论委 24 July 2024 | 6:20PM BST The EM Trader Leaning Defensive into H2 ■ Paradise Delayed for EM assets? Coming into this year, we argued that EM_ assets, having weathered the storm of higher US rates, a stronger Dollar and weak China activity, could deliver more balanced positive returns as the global macro weather changed for the better. However, our expectations of a more convergent growth outlook and non-recessionary cuts has at least been delayed if not denied altogether. Whereas US growth has sl ...