Report Overview - Report Title: Credit Business Weekly Report - Date: November 3, 2025 - Research Institute: Zhongtai Securities Research Institute - Analysts: Xu Chi, Zhang Wenyu 1. Report Industry Investment Rating - Not provided in the report 2. Report Core Views - The positive outcome of the China-US economic and trade consultations and the continuous advancement of domestic reform policies have released dual positive signals, boosting market confidence. Future policies and market trends are expected to revolve around the core logic of "great power competition," benefiting the continuous development of domestic and global asset trends [8]. - Investment suggestions focus on three main lines: geopolitical competition (gold, military, rare earths, non-ferrous metals, etc.), technological competition (AI - related sectors), and supply - chain reconstruction (power equipment, polysilicon, etc.) [8]. 3. Summary by Relevant Catalogs Market Observation: Market Changes after the Positive Outcome of China - US Economic and Trade Consultations Market Performance - A - share major indices showed a "high - then - low" pattern last week. The CSI 300, STAR 50, and ChiNext Index rose in the first half - week and fell in the second half. The CSI 300 and STAR 50 ended the week down 0.43% and 3.19% respectively, while the ChiNext Index rose 0.5%. The CSI 2000 rose 0.95%. The large - cap growth index showed the most obvious "high - then - low" pattern, while the small - cap growth style was strongly supported. The technology sector declined, while the manufacturing and cyclical sectors were stronger [6]. - In terms of sectors, the technology sector declined due to unmet expectations in some aspects, while the manufacturing sector was supported by the "15th Five - Year Plan" and the cyclical sector benefited from geopolitical factors. Non - ferrous metals, steel, and agriculture, forestry, animal husbandry, and fishery performed well [6]. Capital Flow - ETF funds showed net inflows, with funds for the CSI 300, CSI 500, STAR 50, and ChiNext Index turning from outflows to inflows. The CSI 2000 had a continuous and accelerating inflow, and only the dividend index had a small net outflow. Northbound funds increased significantly, leveraged funds grew steadily, and the margin balance reached a new high on October 29. The pressure of major shareholder reduction remained low [7]. Market Review Market Performance - Most major market indices rose last week, with the CSI 1000 having the largest increase of 1.18%. Among the large - category industry indices, the material index and industrial index performed better, rising 2.98% and 1.36% respectively, while the financial index and information technology index performed weakly, falling 1.43% and 0.93% respectively [9][17]. - Among the 30 Shenwan primary industries, 19 industries rose. The power equipment, non - ferrous metals, and steel industries had relatively large increases of 4.29%, 2.56%, and 2.55% respectively, while the communication, beauty care, and banking industries had relatively large declines of 3.59%, 2.21%, and 2.16% respectively [19]. Trading Volume - The average daily trading volume of the Wind All - A Index last week was 23253.35 billion yuan (previous value: 17973.14 billion yuan), at a relatively high historical level (94.10% in the three - year historical quantile) [22]. Valuation Tracking - As of October 31, 2025, the valuation (PE_TTM) of the Wind All - A Index was 22.01, a decrease of 0.58 from the previous week, at the 89.20% quantile in the past five - year history. Among the 30 Shenwan primary industries, 18 industries' valuations (PE_TTM) were repaired [27].

Group 1 - The core viewpoint of the articles discusses the historical market trends in November and year-end, highlighting a shift from "pricing current fundamentals" from April to October to "pricing expectations" from November to March of the following year [1][5] - Historical data indicates that the correlation between market performance in November and fundamentals is weak, often showing a negative correlation, as October is a strong earnings month leading to a need for market correction [1][5] - The market style in November tends to favor small-cap and growth stocks while value and stability lag behind, reflecting a trend of speculative investments in smaller themes [1][5] Group 2 - The year-end market performance is characterized by a search for future economic clues, leading to a revaluation of various industries based on next year's economic expectations [2][3] - The technology and high-end manufacturing sectors are expected to continue their growth momentum, becoming key areas for economic exploration in the coming year [2][3] - The "anti-involution" policies are expected to enhance cyclical sectors, with more areas showing marginal improvement trends, providing room for valuation recovery [2][3] Group 3 - The market is anticipated to enter a more balanced phase with a focus on technology growth, compared to the previous quarter [3] - The scarcity of high-growth sectors has led to increased investor focus on AI, with public funds heavily weighted towards the TMT sector, reaching historical highs [3][6] - As earnings reports conclude, the market is expected to shift focus towards next year's performance expectations and industry trends, leading to a more active thematic investment phase [5][6]

Core Viewpoint - The article emphasizes that investors should move away from short-term speculative trading and focus on the structural changes and opportunities presented by the current market environment, particularly in light of the "15th Five-Year Plan" and technological advancements [4][9][12]. Market Performance - On October 29, the A-share market saw all three major indices rise, with the Shanghai Composite Index closing at 4016.33 points, marking a significant milestone not seen since 2015 [5]. - The market's strong performance was supported by a trading volume of 2.29 trillion yuan, an increase of 125.4 billion yuan from the previous day, with over 2600 stocks gaining [5]. Key Drivers of Market Strength - **"15th Five-Year Plan" Implementation**: The release of detailed guidelines for the "15th Five-Year Plan" has provided a new impetus for the market, enhancing investor confidence and establishing a clearer investment framework [6]. - **Easing of Major Power Tensions**: Recent developments in U.S.-China relations, including constructive trade discussions, have alleviated market pressures and contributed to the A-share rally [7]. - **Expectations of U.S. Federal Reserve Rate Cuts**: Recent U.S. inflation data has strengthened market expectations for further rate cuts by the Federal Reserve, which could positively impact the Chinese market by easing currency pressures and allowing for more domestic monetary policy flexibility [8]. Historical Context - The article draws parallels between the current market situation and previous instances when the Shanghai Composite Index crossed 4000 points in 2007 and 2015, both of which were characterized by rapid market growth driven by traditional sectors [9]. - Unlike past instances, the current market dynamics are underpinned by deeper policy, funding, and industrial synergies, suggesting a more sustainable growth trajectory [9]. Long-term Investment Perspective - The ongoing technological revolution, particularly in AI and semiconductor sectors, is expected to provide lasting momentum for the A-share market, as these areas are prioritized in national strategy [9][10]. - The current policy environment emphasizes long-term stability and systematic upgrades, moving away from short-term adjustments to a focus on innovation and resource optimization [10][11]. - The regulatory framework has been strengthened to enhance market stability and protect long-term investments, indicating a shift towards a more mature market structure [11]. Investment Strategy - Investors are encouraged to focus on high-growth sectors identified in the "15th Five-Year Plan," such as semiconductors and artificial intelligence, rather than getting caught up in short-term market fluctuations [12].

Core Insights - The article discusses the establishment of a new order in global geopolitics and the challenges and opportunities faced by Chinese enterprises going abroad amidst a multi-polar world [1] Agenda Summary - The conference is hosted by Chen Ximiao, head of the National Research Institute of Policy and Industry at Guotai Junan Securities, featuring several experts discussing various topics related to international relations and economic conditions [2] - Key topics include the changing geopolitical landscape and the trajectory of China-U.S. relations, the current economic situation in Europe and its impact on China-Europe trade relations, challenges and new opportunities for Chinese enterprises in the Middle East, and cooperation between China and Africa under the strategic context of critical minerals [3]

Core Viewpoint - The ongoing energy struggle between Hungary and the U.S. highlights the complexities of international relations and the survival strategies of smaller nations amid larger geopolitical conflicts [1][3]. Energy Dependency - Hungary's reliance on Russian energy is deeply rooted in its historical and geographical context, with most of its oil and gas imports coming from Russia [3][5]. - The Russian oil and gas have become integral to Hungary's economy, serving as a "lifeline" for the country's operations [5][6]. EU Sanctions and Hungary's Position - Hungary has strongly opposed the EU's legislative proposal to gradually stop importing Russian energy by the end of 2027, emphasizing its unique energy security needs as an inland country [6][7]. - Hungary has effectively utilized its veto power within the EU to negotiate favorable terms during sanctions discussions, successfully securing exemptions in previous rounds of sanctions [9][11]. Geopolitical Dynamics - Hungary's Prime Minister Viktor Orbán has asserted Hungary's independent stance on broader geopolitical issues, including rejecting Ukraine's EU membership while criticizing the EU's financial support for Ukraine [15][17]. - The U.S. aims to reduce Europe's dependency on Russian energy, positioning itself as a primary energy supplier to the EU, which has implications for Hungary's energy strategy [17][27]. Energy Diversification Efforts - Despite external pressures, Hungary is actively seeking to diversify its energy sources while maintaining stable supplies from Russia, including agreements with Shell and discussions with Middle Eastern oil producers [19][21]. - The transition to alternative energy sources is a complex process requiring significant investment and time, as highlighted by Hungary's ongoing reliance on Russian energy [21][27]. Strategic Positioning - Hungary's assertive response to U.S. pressure reflects a clear understanding of its national interests and the strategic use of international rules to navigate the geopolitical landscape [22][25]. - The increasing Chinese investment in Hungary, particularly in the battery and automotive sectors, enhances Hungary's resilience against external pressures [22][23]. Conclusion - The interplay of energy dependency, geopolitical maneuvering, and national interests underscores the challenges faced by Hungary and similar nations in the current international landscape, where energy security and political considerations are intricately linked [27][28].

Core Viewpoint - The recent trade agreements signed by the U.S. with Malaysia, Thailand, and Cambodia aim to reduce dependence on Chinese rare earth supplies, but the effectiveness of these agreements in challenging China's dominance in the rare earth sector remains uncertain [1][5]. Group 1: Rare Earth Supply and Demand - Malaysia's proven rare earth reserves are approximately 16.1 million tons, which is significantly lower than China's vast reserves [3]. - China not only holds the largest rare earth reserves globally but also leads in separation and processing technologies, making it difficult for Malaysia to meet U.S. industrial demands through exports [3][5]. - Malaysia has regulations in place that limit the export of rare earth materials to protect its resources, raising doubts about the ability of the agreements to replace Chinese supplies [3]. Group 2: Strategic Intent and Market Dynamics - The U.S. seeks to diversify its rare earth supply chains in response to China's growing economic and technological advantages, particularly amid stricter export controls [5][7]. - The economic value of the agreements may diminish if Malaysia relies on Chinese technology for processing rare earths, as the nature of the supplied materials (raw ore vs. processed products) remains unclear [5][7]. - The competition for rare earths is evolving into a technological contest, with China maintaining control over the entire supply chain due to its established production lines and technology [5][7]. Group 3: Regional Economic Implications - The cooperation between the U.S. and Southeast Asian countries may lead to a new competitive landscape, prompting China to adopt a more cautious approach regarding technology exports [7]. - Southeast Asian nations like Malaysia, Thailand, and Cambodia face the challenge of balancing their relationships with both the U.S. and China while seeking development opportunities [7]. - The evolving dynamics could reshape the entire economic chain in Southeast Asia, necessitating strategic thinking from these countries to maximize their benefits [7].

Core Points - The joint statement from 14 countries, including the UK, France, Germany, and Italy, emphasizes immediate ceasefire in Ukraine and the use of frozen Russian assets for Ukraine's reconstruction, notably without the involvement of the US [1][2] - Ukraine's agreement to ceasefire at the current contact line indicates a deteriorating military situation for Ukraine, contrasting with its previous hardline stance [2][5] - The Russian military claims significant territorial gains and encirclement of Ukrainian forces, suggesting increasing pressure on Ukraine [3][5] Group 1: Geopolitical Dynamics - The absence of the US in the joint statement reflects a shift in alliances, with traditional allies acting independently, which may impact the East Asian situation [1][5] - Trump's administration is focused on minimizing losses in Ukraine while seeking to distance from the conflict, contrasting with European nations' desire to weaken Russia [5][6] - The divergence in threat perception between Europe and the US, with Europe viewing Russia as the primary threat and China as secondary, complicates unified strategies against China [8][9] Group 2: Military and Economic Implications - The ongoing military challenges faced by Ukraine, coupled with reduced US support, suggest a bleak outlook for Ukrainian resistance [5][9] - European nations are beginning to take actions against China, indicating a potential shift in focus from the Ukraine conflict to addressing competition with China [9][10] - The possibility of a coordinated trade war between the US and Europe against China could emerge if the Ukraine conflict reaches a resolution [10]

Group 1 - The core viewpoint of the articles indicates that significant progress has been made in US-China trade negotiations, with agreements reached on key economic issues such as maritime logistics, shipbuilding industry measures, and agricultural trade [1] - The US has extended the suspension period for reciprocal tariffs and reached a basic consensus on fentanyl tariffs and enforcement cooperation [1] - The articles highlight the geopolitical dynamics, noting that countries that previously aligned with the US against China may face repercussions as the situation evolves [3][5] Group 2 - The EU has expressed strong rhetoric regarding China's rare earth export controls, with leaders like von der Leyen and Macron considering measures to counter China's actions [5] - Germany's foreign minister has made statements regarding the "One China" policy, indicating a willingness to interfere in China's internal matters, which reflects a lack of respect for China's sovereignty [5] - The Netherlands has faced backlash for its aggressive stance against China, particularly in relation to semiconductor assets, illustrating the risks of choosing sides in the US-China rivalry [5]

Core Viewpoint - The U.S. government has imposed significant sanctions on two major Russian oil companies, Rosneft and Lukoil, marking a pivotal shift in U.S.-Russia relations amid ongoing geopolitical tensions related to the Ukraine conflict [3][5][6]. Sanctions Overview - The sanctions include placing Rosneft and Lukoil, along with over thirty affiliated entities, on the Specially Designated Nationals List, which will freeze their overseas assets and prohibit U.S. citizens and entities from engaging in any business with them [4][5]. - The sanctions are a direct response to the stalled ceasefire negotiations between Russia and Ukraine, reflecting a more aggressive U.S. stance under the Trump administration [6]. Secondary Sanctions - A critical aspect of the sanctions is the "secondary sanctions" clause, which warns foreign financial institutions against engaging in significant transactions with the sanctioned Russian companies, potentially exposing them to U.S. retaliation [8]. India's Response - Following the announcement of sanctions, Indian state-owned refineries quickly initiated a review of their contracts with Russian suppliers, indicating a strong reaction to U.S. geopolitical pressure [10]. - Indian Oil, HPCL, BPCL, and MRPL, which control over 60% of India's refining capacity, have shifted their focus away from Russian oil towards Middle Eastern and West African sources [10][11]. India's Geopolitical Position - India's rapid response to U.S. sanctions highlights its precarious position between reliance on Russian energy supplies and the desire to maintain strong ties with the U.S. [11][12]. - Despite the pressure, India has not completely halted Russian oil imports, reducing its share to 25% while negotiating with the U.S. for the lifting of sanctions on Iranian and Venezuelan oil [12][14]. China's Strategy - In contrast to India's opportunistic approach, China has maintained a calm and strategic stance, continuing its energy cooperation with Russia without significant disruption [13][15]. - China's state-owned oil companies have adjusted their import strategies, reducing Russian oil orders by 15% while increasing pipeline imports, ensuring energy security amidst sanctions [13][14]. Economic Impact on Russia - The sanctions are expected to significantly impact Russia's economy, as the sanctioned companies account for nearly 50% of its oil exports, which are crucial for government revenue [15][16]. - The loss of India as a major buyer has increased Russia's dependency on China, enhancing China's bargaining power in energy negotiations [15][16]. Conclusion - The differing responses of India and China to U.S. sanctions reflect their respective economic strengths and strategic priorities, with India focusing on short-term gains and China demonstrating a long-term energy security strategy [14][16].

Core Points - The initiation of tariff reduction procedures by Canada following the foreign minister's visit to China signals a potential thaw in bilateral relations, but it remains uncertain whether this is a genuine step towards improvement or a temporary measure based on geopolitical calculations [1][5][11] Economic and Trade Relations - Historically, Canada and China have maintained a robust economic partnership, with China being Canada's second-largest trading partner for several years. However, recent geopolitical tensions have led to Canada imposing discriminatory tariffs on Chinese products, resulting in retaliatory measures from China and a significant decline in bilateral trade [3][6] - The recent tariff reduction is seen as a fulfillment of commitments made during the foreign minister's visit, indicating Canada's intention to recalibrate its relationship with China and repair the strategic ties that have been strained [5][11] Geopolitical Context - From a broader perspective, Canada's policy shift reflects its need to seek a strategic balance among major powers, particularly in light of its historical reliance on the United States. The trade protectionism of the Trump administration has prompted Canada to diversify its economic partnerships beyond the U.S. [6][8] - The foreign minister's trip to Asia, which included visits to China, India, and Singapore, is part of Canada's strategy to establish reliable partnerships in the Indo-Pacific region, aiming to safeguard its economic interests amid escalating U.S.-China competition [6][8] Limitations and Cautions - The tariff reduction policy is limited and not a comprehensive removal of discriminatory measures, as it operates on an application basis for businesses, reflecting a cautious and temporary approach by Canada [8] - Canada's ongoing structural security dependence on the U.S. raises concerns about potential backlash from Washington if Canada were to significantly alter its relationship with China [8][9] Future Outlook - The 55th anniversary of diplomatic relations presents an opportunity for Canada to transform temporary tariff reductions into long-term policy changes, which could revitalize bilateral trade if all discriminatory measures are eliminated [11] - China has expressed a willingness to adjust its countermeasures if Canada corrects its previous actions, emphasizing the need for mutual respect and trust in improving relations [9][11] - Ultimately, the success of this interaction hinges on Canada's ability to move beyond its reliance on the U.S. and demonstrate genuine strategic intent towards China, which could unlock significant opportunities in the Chinese market [11]