Market Overview - The A-share market showed strong performance, with the Shanghai Composite Index reaching a high of 3499.89, just shy of the 3500 mark, indicating a bullish sentiment among investors [1][3] - Global markets experienced a rally, influenced by the TACO trading and perceived hesitance from the U.S. administration regarding negotiations with Japan and South Korea [3] - The implementation of new quantitative regulations led to a significant influx of capital, with trading volume returning to 1.5 trillion and a notable recovery in financing [4] Financial Industry Insights - The asset management sector is under pressure to adapt to the improving market conditions, as previously poor performance made it understandable for funds to struggle [8] - The rapid growth of the "Wangshang Bank's" "Stable Treasure" product, which has over 4 million users, highlights the power of internet platforms in the financial sector [9][11] - The overall scale of the wealth management industry has reached approximately 32 trillion, driven by a shift from traditional savings to investment products [12] Product Strategy and Market Trends - The success of Xiaomi's automotive sales offers valuable lessons for asset management firms, emphasizing the importance of a focused and transparent product strategy [14][21] - The "Stable Treasure" product adopts a boutique approach, prioritizing quality over quantity, which has resulted in high user retention and repurchase rates [25] - The asset management industry is encouraged to move towards a model that emphasizes standardization, transparency, and premium offerings to meet evolving consumer demands [22][23] Regulatory Changes and Future Outlook - The expansion of the southbound bond connect will allow insurance companies to invest in offshore bonds, potentially reshaping the investment landscape [29][31] - The ability to access international debt markets may divert some capital away from domestic long-term bonds and REITs, necessitating close monitoring of policy developments [32]

Core Viewpoint - The market appears to be indifferent to Trump's latest tariff threats, reflecting a belief that these threats may not be implemented or will have minimal impact on the economy and corporate profits [1][3]. Group 1: Market Reaction - Trump's announcement to delay tariff negotiations until August 1 and impose 25% tariffs on Japanese and South Korean products, as well as up to 40% on products from 12 other countries, resulted in a modest decline of 0.2% in the S&P 500 index [1]. - The South Korean stock market saw a significant increase, with the Seoul Composite Index rising by 1.5% at one point, indicating a positive market sentiment despite the tariff threats [1]. - Analysts suggest that the market's calm response indicates a belief that the tariffs will not have a substantial effect on economic growth or corporate profits [3]. Group 2: Investor Sentiment - Investors seem to be ignoring the latest tariff announcements, interpreting them as a negotiation tactic rather than a definitive stance on tariff levels [4]. - The market has adapted to the unpredictable nature of tariff policies, with significant structural misalignments observed, as evidenced by the stability of U.S. inflation swap prices despite ongoing tariff threats [4]. - The prevailing sentiment is that the tariff threats are not taken seriously, leading to potential risks if Trump adopts a more aggressive stance unexpectedly [3][4].

Core Insights - The "TACO trade" has significantly influenced asset pricing and volatility since Trump's inauguration in January 2025, with a notable convergence in the contribution of fundamental data such as inflation and employment to asset pricing [1] - During Trump's pressure phase, it is advisable to buy safe-haven assets like gold and bonds, while sectors such as agriculture in A-shares, healthcare in Hong Kong, and utilities in the US stock market have shown relative stability [1] - In the retreat phase, equity assets are favored, with A-share financial and technology sectors performing better [1] - The current key risk overseas is the slow pace of Federal Reserve rate cuts, which raises concerns about the sustainability of US fiscal policy [1] TACO Trade Strategy Cases - Case I highlights the liquidity shock to global capital markets from reciprocal tariffs [2] - Case II discusses Trump's tariff pressure on the EU and its market implications [2] - Case III examines the interplay of interests between Musk and Trump, showcasing the TACO trade's dynamics [2] Deep Reasons for TACO Trade - The TACO trade stems from Trump's negotiation strategy of "seeking the upper hand" [3] - The Trump administration aims to balance multiple objectives in negotiations [3] - Non-US economies like China have gained more negotiating power [3] Asset-Level Review of TACO Trade - In the first half (January 13 - April 7), the market experienced a "stagflation trade" with US stocks declining, US bonds rising, and non-US currencies strengthening [4][23] - The second half (April 8 - July 4) saw a rebound in US stocks, with the Nasdaq rising 32% and the S&P 500 recovering significantly [4][24] Equity Sector Review of TACO Trade - In the first half, defensive sectors in A-shares outperformed, while technology and healthcare in Hong Kong showed strong performance [5][27] - In the second half, financial and military sectors in A-shares excelled, with Hong Kong's financial, healthcare, energy, and new consumption sectors also performing well [5][32] TACO Trade Outlook - The domestic equity market is expected to be "self-reliant," with recommendations to focus on banks as a stabilizing force and to balance investments in brokerages, military, and TMT sectors [6] - Globally, the trend of "de-dollarization" is anticipated to slow down, with a focus on rebalancing dollar asset allocations [6] - The potential for a "Buy The Dip" strategy remains effective, but caution is advised regarding the risk of stagflation [6]

Group 1: Trump's Policy Logic - The logic behind Trump's policy is structured, focusing on increasing government revenue through tariffs, promoting manufacturing return, and adjusting tariffs based on industry rather than country [2][3] - The "Big and Beautiful" plan aims to reduce taxes and spending while raising the debt ceiling, with projected federal revenue loss of approximately $4 trillion over the next decade [3] - Deregulation is intended to stimulate the economy by removing banking regulations related to cryptocurrency and expediting government approval processes [3] Group 2: Market and Election Pressures - Market pressure plays a significant role in Trump's policy adjustments, particularly in response to movements in the U.S. Treasury market, with a tendency to ease policies when 10-year Treasury yields rise significantly [4][5] - Election pressures are also a factor, as economic downturns and inflation from tariff wars could negatively impact Trump's voter base, necessitating a softening of tariff policies [6] Group 3: U.S. Treasury Market Dynamics - High U.S. Treasury yields are unlikely to be sustained due to the Federal Reserve's current stance and the need for policy space amid economic uncertainties [8][9] - The long-term outlook suggests that U.S. Treasury yields may exceed nominal economic growth rates, which could suppress economic growth [9][10] - A new framework for long-term Treasury pricing is proposed, incorporating a sovereign risk premium to account for market concerns about U.S. debt [20][22] Group 4: Broader Economic Considerations - The U.S. is seeking new support for the dollar through high-tech exports and controlling supply chains, which may mitigate inflation domestically [23][24] - The U.S. Treasury's debt ceiling situation is critical, with current measures to manage liquidity potentially leading to a "fiscal window" before a new debt agreement is reached [25][26]

Group 1 - The article discusses the evolution of the relationship between Trump and Musk, highlighting their initial close alliance and subsequent public fallout due to ideological differences and personal conflicts [4][5][7] - Musk's role in the Trump administration was initially seen as pivotal, addressing key economic issues like inflation and national debt, but conflicts over tariffs and fiscal policies led to a gradual deterioration of their relationship [3][6][8] - The article emphasizes that the breakdown of their partnership was not sudden but rather a result of systemic erosion of trust and influence, driven by policy decisions that conflicted with Musk's business philosophy [7][8] Group 2 - The "DOGE" initiative, which aimed for significant budget cuts, achieved approximately $175 billion in spending reductions during Musk's tenure, representing 8.75% of the $2 trillion target [11] - Despite these achievements, the article notes that the entrenched structural resistance within the U.S. government limits the effectiveness of top-down reforms like those attempted by Musk [11][14] - The article suggests that the future of "DOGE" may transition into a more systematic and institutionalized phase under Trump's leadership, focusing on fiscal sustainability and efficiency improvements [15][16] Group 3 - The article critiques the systemic inefficiencies of the U.S. government, attributing them to a culture of over-regulation that fosters a compliance-driven mentality among civil servants, which ultimately hampers effective governance [12][14] - Examples of inefficiencies, such as the prolonged delays in major projects like the California high-speed rail and the new Air Force One, illustrate the challenges faced in government operations [13] - The article posits that for "DOGE" to succeed, it must address these deep-rooted structural issues rather than merely implementing superficial cost-cutting measures [14] Group 4 - The article discusses the misjudgment of Wall Street regarding Trump's economic policies, particularly the "TACO" trade, which underestimated his commitment to fiscal tightening and debt sustainability [17][18] - It highlights the potential for Trump's future policies to diverge from market expectations, particularly if he pursues aggressive spending cuts alongside tax reductions, which could lead to economic recession [18] - The overarching narrative suggests that Trump's fiscal strategies are aimed at ensuring long-term financial health and maintaining the global status of the U.S. dollar, despite short-term economic pain [18]

Group 1: Overseas Macro Insights - Developed countries show relative resilience under tariff shocks, with May manufacturing PMI for developed nations rising to 50.0%, up 0.9 percentage points from April[6] - Emerging economies' manufacturing PMI dropped to 49.2%, down 1.3 percentage points from April, indicating higher reliance on global trade[6] - U.S. inflation remained stable in May, with CPI increasing by 2.4% year-on-year, a slight rise of 0.1 percentage points from April[8] Group 2: Domestic Macro Insights - China's retail sales grew by 6.4% year-on-year in May, driven by early e-commerce promotions and trade-in policies[2] - Fixed asset investment growth slowed to 2.9% year-on-year in May, down 0.7 percentage points from April, with manufacturing investment declining for two consecutive months[16] - Exports to the U.S. fell sharply by 34.5% year-on-year in May, significantly impacting overall export performance[19] Group 3: Policy and Trade Negotiations - U.S.-China tariff negotiations saw a temporary breakthrough, with a joint statement on May 13 maintaining tariffs at 10% and suspending 24% tariffs for 90 days[3] - The ongoing trade talks are expected to face high uncertainty, with potential delays in reaching a final agreement exceeding 90 days[23] Group 4: Economic Risks and Outlook - Deflationary pressures persist, with May CPI down 0.1% and PPI down 3.3%, indicating significant deflation risks[20] - The overall economic data for May shows resilience, but concerns remain regarding the sustainability of consumption and export growth[20]

即便零售行业高管也对"TACO交易"抱有乐观态度。"TACO"是"特朗普总是退缩（Trump Always Chickens Out）"的缩 写。 咨询公司AlixPartners的最新调查显示，在经历数周贸易政策变动、初步协议及复杂的法庭挑战后，部分零售商高管开 始对特朗普所谓的"对等"关税持更乐观态度。 一项于6月1日对品牌、零售商及其他消费品公司高管的调查发现，多数受访者预计总统将在7月9日"对等"关税90天暂 停期结束后，撤回对欧盟、越南、印度和墨西哥的高额关税。 来自上述地区及数十个其他国家的进口商品正面临10%的关税。但随着特朗普政府试图与各国敲定贸易协议，多数调 查受访者预计，谈判结束后10%的关税将继续生效，而非维持4月2日最初实施的更高税率。 消费品公司和零售商目前在为哪些关税情景做规划？ 对许多零售商而言，越南已成为下一个制造业前沿。东南亚国家与华盛顿的谈判备受关注，也是近几个月许多高管最 大的担忧之一。 AlixPartners合伙人兼董事总经理索尼娅·拉平斯基（Sonia Lapinsky）表示，在特朗普宣布并随后暂时降低高额"对 等"关税后的几周里，许多高管担心税率最终会高于10%。 ...

Core Insights - The U.S. government has signaled a willingness to extend the deadline for tariff negotiations, indicating flexibility in its trade policy for countries engaging in good faith talks [1][2] - The European Union anticipates that trade negotiations with the U.S. will continue beyond the July 9 deadline, aiming for a preliminary agreement on principles before the deadline [2][3] Group 1: U.S. Trade Policy Developments - U.S. Treasury Secretary Mnuchin acknowledged the possibility of extending the tariff deadline for countries like the EU that are negotiating in good faith [1] - President Trump expressed a willingness to extend the July 8 deadline but deemed it "not very necessary," revealing ongoing trade discussions with approximately 15 countries [1][2] Group 2: Market Reactions and Investor Sentiment - The announcement from Mnuchin has reignited hope among investors betting on the "TACO trade," which suggests that the Trump administration may backtrack on its aggressive tariff policies [2] - Following Trump's initial tariff announcements in April, the S&P 500 index experienced a significant drop of over 12% within four days, marking the largest decline since the onset of the COVID-19 pandemic [2] Group 3: EU's Position and Negotiation Challenges - The EU is preparing for extended negotiations with the U.S., focusing on key sectors such as steel, aluminum, automotive, pharmaceuticals, semiconductors, and civilian aircraft [3] - Current U.S. tariffs cover approximately €380 billion (about $434 billion) of EU exports, representing around 70% of the EU's total exports to the U.S. [3]

Group 1 - The article discusses the challenges faced by the current administration, particularly in relation to trade negotiations and internal political dynamics [1][3][21] - The term "TACO" is introduced, symbolizing the administration's tendency to backtrack on strong positions, particularly in trade matters [1][5][9] - The administration's approach to immigration enforcement is causing discontent among its base, potentially jeopardizing support from key demographics [3][4][6] Group 2 - Recent trade negotiations with Japan have highlighted internal conflicts among U.S. representatives, leading to ineffective discussions and a lack of coherent strategy [10][12][14] - The article suggests that the administration's internal strife and lack of clear direction may hinder its ability to secure favorable trade agreements [14][23] - The potential for leveraging U.S. debt as a financial tool in trade negotiations is mentioned, indicating a complex interplay of economic strategies [8][24] Group 3 - The article emphasizes the importance of understanding the administration's fluctuating stance on trade and its implications for global economic relations [20][22][24] - It notes that the administration's focus on internal conflicts may detract from addressing external competitive pressures [21][22] - The conclusion suggests that the ongoing trade war could present opportunities for other economies to strengthen their positions [24][26]

Core Viewpoint - The Hong Kong stock market is showing strong performance, with the Hang Seng Index and Hang Seng Tech Index both rising over 20% since April, indicating a technical bull market driven by technology, pharmaceuticals, and consumer sectors [1][3]. Market Performance - The Hang Seng Index surpassed 24,000 points, and the Hang Seng Tech Index increased by 2.78% [1]. - There is a notable trend of funds returning to the Hong Kong market, with the tech and AI sectors becoming the main battleground for investments [1][3]. - A significant number of warrants saw substantial gains, with 17 warrants doubling in value and some reaching a maximum increase of 300% [3]. Liquidity Conditions - The liquidity in the Hong Kong market remains ample, with the offshore RMB Hong Kong Interbank Offered Rate (CNH Hibor) declining across all major tenors, including a drop of 15 basis points to 1.34985% for overnight Hibor, the lowest since May 28 [1][4]. - The Hong Kong Monetary Authority's liquidity measures have led to a significant reduction in Hibor rates, improving market liquidity and making dividend yields more attractive compared to market rates [5]. Future Outlook - Analysts predict that the Hong Kong stock market will continue to attract investment due to policy support and the AI boom, with a favorable valuation compared to U.S. tech stocks [7]. - The current valuation of the Hang Seng Index at around 10 times earnings presents a clear advantage over U.S. tech indices, which have significantly higher price-to-earnings ratios [7]. - The market's risk appetite may improve in the short term due to positive signals from U.S.-China relations, although long-term uncertainties remain [8].