Hua Er Jie Jian Wen·2025-10-31 11:22Core Viewpoint - The latest report from Shenwan Hongyuan indicates a decline in both production and demand, with the manufacturing PMI for October showing accelerated contraction, while the service sector experiences expansion due to the holiday effect [1]. Manufacturing Sector - The manufacturing PMI for October 2025 is reported at 49.0%, a decrease of 0.8 percentage points from the previous month [1]. - The production index fell by 2.2 percentage points to 49.7%, which is below the seasonal level compared to previous years [1][3]. - The new orders index decreased by 0.9 percentage points to 48.8%, indicating a faster contraction in demand, also below the seasonal level [1][3]. Price Trends - The major raw materials purchasing price index is at 52.5%, while the factory price index is at 47.5%, both showing a decline of 0.7 percentage points [1]. - The consumer goods factory price index has decreased, while the high-tech manufacturing factory price index has increased, reflecting a divergence in price trends [1]. Service Sector - The service sector PMI increased by 0.1 percentage points to 50.2%, driven by the holiday effect, with business activity indices for travel-related industries exceeding 60.0% [1]. Real Estate Sector - The construction business activity index fell to 49.1%, down 0.2 percentage points, impacted by slower construction progress during the holidays [1]. - Fixed asset investment growth continues to decline, and while there has been a temporary boost in real estate sales following policy adjustments, the sustainability of this trend is uncertain [1]. Economic Outlook - The overall economic situation remains under pressure, with the bond market's previous stress being alleviated, leading to increased focus on fundamentals [1]. - Recent developments in US-China trade talks and the Fourth Plenary Session's focus on top-level design are expected to have limited short-term impact on the bond market [1].