Group 1 - The yield on Germany's 10-year government bonds remained stable at 2.707%, trading within a range of 2.722% to 2.706% during the day [1] - The yield on 2-year German bonds increased by 0.1 basis points to 2.047%, with a trading range of 2.045% to 2.053% [1] - The yield on 30-year German bonds decreased by 0.3 basis points to 3.375% [1] Group 2 - The yield spread between 2-year and 10-year German bonds narrowed by 0.019 basis points, now at 65.867 basis points [1]

Market Performance - The three major U.S. stock indices closed higher, with the Dow Jones up 0.76% at 49,174.5 points, the S&P 500 up 0.77% at 6,890.07 points, and the Nasdaq up 1.04% at 22,863.68 points [1] - Major tech stocks mostly rose, with AMD increasing over 8%, Intel over 5%, and Tesla, Netflix, and Apple each rising over 2% [1] Chinese Stocks - Most Chinese stocks saw gains, with Global Data up over 6%, Century Internet over 6%, and XPeng Motors over 6% [1] - Declines were noted in companies like Hesai Technology, which fell over 2%, and Zai Lab, which dropped over 1% [1] European Market - European indices had mixed results, with Germany's DAX down 0.02% at 24,986.25 points, France's CAC40 up 0.26% at 8,519.21 points, and the UK's FTSE 100 down 0.04% at 10,680.59 points [1] Commodity Prices - International precious metal futures showed mixed results, with COMEX gold futures down 1.25% at $5,160.50 per ounce and COMEX silver futures up 0.57% at $87.07 per ounce [1] - Crude oil prices fell slightly, with the main U.S. oil contract down 0.35% at $66.08 per barrel and Brent oil down 0.06% at $71.07 per barrel [1] Currency and Debt Markets - The U.S. dollar index rose 0.17% to 97.90, while the offshore RMB against the dollar increased by 95 basis points to 6.8798 [1] - U.S. Treasury yields were mixed, with the 2-year yield up 2.73 basis points at 3.461% and the 10-year yield down 0.38 basis points at 4.031% [1] - European bond yields collectively fell, with the UK 10-year yield down 0.9 basis points at 4.304% and Germany's 10-year yield down 0.4 basis points at 2.705% [1]

Market Overview - The Nikkei 225 index opened high, with an increase of over 1%, reaching approximately 57,098 points as of 9:30 AM Beijing time [1] - The Japanese yen experienced a short-term rise, with the USD/JPY exchange rate reported at 153.367, marking a cumulative decline of about 0.7% over the past five trading days [3] - Japanese government bond yields saw a comprehensive decline, with the 10-year bond yield falling to 2.111% and the 30-year bond yield dropping to 3.378% [4] Bond Market - The yields for various Japanese government bonds are as follows: - 10-year bond yield: 2.111%, down 1.26% from the previous day [5] - 15-year bond yield: 3.129%, down 0.82% [5] - 20-year bond yield: 2.962%, down 0.60% [5] - 30-year bond yield: 3.378%, down 0.44% [5] - 40-year bond yield: 3.623%, down 0.22% [5] Precious Metals - In the international precious metals market, gold and silver saw a strong rally after a low opening. Spot gold initially dropped nearly 0.5% but later increased by over 0.2%, approaching $4,900 per ounce [6] - Spot silver experienced a drop of over 1.6% but is currently reported at $73 per ounce, reflecting a daily increase of 0.78% [6]

Core Viewpoint - The UK unemployment rate has risen to its highest level in five years, with wage growth slowing, leading to a decline in the pound and UK government bond yields [1][3]. Employment Data - In January 2026, the number of employees in the UK decreased by 0.4% year-on-year to 30.3 million, which is a reduction of 134,000 from January 2025 and a decrease of 11,000 from the previous month [2][5]. - The unemployment rate increased from 5.1% to 5.2% compared to the previous month [2][5]. Market Reactions - Following the employment data release, the pound fell by 0.5% against the dollar, closing at 1 pound to 1.356 dollars, and dropped 0.2% against the euro [2][5]. - The yield on UK government bonds decreased across the board, with the 10-year bond yield falling nearly 4 basis points to 4.367% and the 30-year bond yield also down by 4 basis points to 5.168% [3][6]. Stock Market Performance - The FTSE 100 index in London rose by 0.4% during afternoon trading [2][5]. - The broader European market showed mixed results, with the Stoxx 600 index hovering around the flat line, while the Italian FTSE MIB index increased by 0.5% and the German DAX index rose by 0.1% [1].

1. Report's Industry Investment Rating No information provided in the content. 2. Core Viewpoints of the Report - In 2025, the central bank implemented a moderately loose monetary policy, keeping liquidity abundant. The yields of interest - rate bonds showed an overall fluctuating upward trend, while the issuance rates of credit bonds decreased. The total issuance of interest - rate and credit bonds increased steadily year - on - year. Credit risks were converging. Looking forward to 2026, bond market yields are expected to remain volatile at low levels, credit spreads may show structural differentiation, the bond market issuance scale is expected to grow steadily, and bond market credit risks will continue to converge with the default rate possibly at a historical low [2]. 3. Summary by Relevant Catalogs 3.1 Bond Market Overall Situation - In 2025, China's bond market issued a total of 88.52 trillion yuan of various bonds, a year - on - year increase of 12.35%. Excluding inter - bank certificates of deposit, the total issuance of various bonds was 54.70 trillion yuan, a year - on - year increase of 15.40%. By the end of 2025, the stock of various bonds in China reached 196.17 trillion yuan, a growth of 11.45% compared with the end of 2024 [4]. 3.1.1 Interest - rate Bonds - **Yield Trend**: The yield of China's treasury bonds showed an overall fluctuating upward trend in 2025. The 10 - year treasury bond yield fluctuated in five different stages throughout the year, affected by factors such as economic data, policy expectations, and market sentiment [5]. - **Issuance Scale**: The bond market issued 32.39 trillion yuan of interest - rate bonds in 2025, a year - on - year increase of 20.63%. The issuance scale of each type of bond increased. By the end of 2025, the stock of interest - rate bond varieties in China's bond market was 123.51 trillion yuan, a growth of 14.75% compared with the previous year - end [8][9]. 3.1.2 Credit Bonds - **Issuance Interest Rate**: In 2025, the issuance rates of major credit bonds showed a downward trend. Taking the credit bonds issued by AAA - rated entities as an example, the average issuance rates of major bond types with various maturities decreased [10]. - **Issuance Volume**: The issuance scale of credit bonds reached 22.06 trillion yuan in 2025, a year - on - year increase of 8.14%. By the end of 2025, the stock of credit bonds was 51.35 trillion yuan, a year - on - year increase of 8.61%. Different sub - categories of credit bonds had different issuance trends [13]. - **Non - financial Enterprise Bonds**: In 2025, non - financial enterprises issued 15,790 issues of bonds with a total issuance scale of 13.94 trillion yuan. The issuance period and scale increased by 2.87% and 1.70% year - on - year respectively. By the end of 2025, the stock of non - financial enterprise bonds was 31.29 trillion yuan, a growth of 10.00% compared with the previous year - end [14]. - **Non - policy Financial Bonds**: Financial institutions issued 1,488 issues of non - policy financial bonds in 2025, with a total issuance scale of 5.66 trillion yuan. The issuance period and scale increased by 34.54% and 24.74% year - on - year respectively. By the end of 2025, the stock of non - policy financial bonds was 15.66 trillion yuan, a growth of 11.35% compared with the previous year - end [18]. - **Asset - backed Securities**: In 2025, the issuance period, number, and scale of asset - backed securities all increased by about 15%. By the end of 2025, the stock of asset - backed securities was 3.61 trillion yuan, an increase of 9.16% compared with the previous year - end [22]. - **Other Credit Bonds**: In 2025, the issuance period and scale of other credit bonds increased year - on - year. By the end of 2025, the stock of other credit bonds was 1.07 trillion yuan, a decrease of 14.81% compared with the previous year - end [24]. 3.2 Bond Market Operation Characteristics - **Issuance of Urban Investment Bonds and Industrial Bonds**: In 2025, the issuance of urban investment bonds decreased, while the issuance of industrial bonds increased. The net financing of urban investment bonds decreased, and that of industrial bonds increased [27]. - **Rating and Credit - grade Distribution**: The proportion of bonds without debt ratings continued to increase, and the proportion of bonds issued by AAA - rated entities continued to rise. The credit grades of non - financial enterprise credit bond issuers were mainly distributed between AAA and AA [29][34]. - **Enterprise Nature of Issuers**: In 2025, state - owned enterprises were still the main issuers of non - financial enterprise bonds. The proportion of bonds issued by central state - owned enterprises and private enterprises increased, while that of local state - owned enterprises decreased [36]. - **Regional and Industry Differentiation**: The regions and industries involved in non - financial enterprise bond issuers remained differentiated. In terms of regions, the issuance scale of non - financial enterprise bonds in some regions increased, while in some others it decreased. In terms of industries, the issuance scale of some industries increased, while in some others it decreased [41]. - **Innovative Bond Issuance**: In 2025, the issuance of innovative bonds maintained a good momentum. The issuance period and scale of science and technology innovation bonds increased by about 80%, and the issuance of other innovative bonds also increased significantly [43]. - **Credit Risk Convergence**: In 2025, the number of new default issuers, the number of defaulted bonds, and the default amount in China's bond market all decreased year - on - year. The number of new extended - maturity issuers decreased, but the number of extended - maturity bonds and the extended - maturity scale increased. Overall, the bond market credit risk showed a converging trend [47]. 3.3 Bond Market Outlook - **Yield and Credit Spread**: Interest - rate bond yields are expected to remain volatile at low levels, with limited upside and downside space. Credit bond yields are expected to follow interest - rate bonds and maintain a low - level volatile trend. Credit spreads are expected to remain low, but market disturbances may increase [48][49]. - **Issuance Scale**: In 2026, the issuance scale of interest - rate bonds is expected to increase due to a more active fiscal policy. The issuance scale of financial institution bonds in the credit bond market is expected to grow steadily, while the issuance of urban investment bonds may shrink slightly, and the issuance of industrial bonds is expected to grow continuously [50]. - **Credit Risk**: In 2026, the bond market credit risk is expected to continue to converge, and the default rate may be at a historical low. Different types of bonds, such as urban investment bonds, real estate enterprise bonds, financial bonds, and convertible bonds, have different credit risk characteristics and need to be monitored [51][52].

Group 1 - The yield on Germany's 10-year government bonds decreased by 1.4 basis points, settling at 2.779%, with intraday trading between 2.805% and 2.775% [1] - The yield on 2-year German bonds fell by 0.6 basis points to 2.060%, trading within a range of 2.077% to 2.054% during the day, showing a significant drop just before midnight Beijing time [1] - The yield on 30-year German bonds declined by 0.7 basis points, reaching 3.449% [1] Group 2 - The yield spread between 2-year and 10-year German bonds decreased by 0.735 basis points, now at +71.658 basis points [1]

Core Viewpoint - Japanese Prime Minister Sanna Takashi's overwhelming election victory has sparked positive investor reactions, but concerns remain regarding her extensive spending plans and their potential impact on market stability [1] Group 1: Spending Plans and Market Reactions - Takashi acknowledged market concerns about how to balance a two-year reduction in food sales tax while significantly increasing defense and strategic industry spending, which could exacerbate Japan's already high public debt [1] - The yield on Japanese government bonds surged to its highest level in decades last month, reflecting investor anxiety over increased spending and debt issuance [1] - Ebury's market strategy head, Matthew Ryan, warned that expanding spending and increasing debt issuance could raise risk premiums and trigger a new round of bond sell-offs [1] Group 2: Funding Sources and Economic Implications - Takashi stated that the government would not fill spending gaps by issuing new bonds but would instead review subsidies and non-tax revenue sources for sustainable funding [2] - Concerns are rising about how these measures will be funded and whether the government will resort to issuing deficit-covering bonds [2] - The suspension of the food consumption tax for two years is expected to cost 5 trillion yen (approximately 34 billion USD) annually, with potential funding from non-tax revenue sources like foreign exchange reserves [2] Group 3: Debt and Interest Rate Dynamics - The benchmark 10-year Japanese government bond yield hovers around 2.2%, nearly double from a year ago, leading to increased costs for the government as it issues new bonds at higher rates [3] - The rising costs of servicing Japan's substantial debt, which exceeds twice the size of its economy, have grown by one-third over the past decade and now account for a quarter of the annual budget [3] - The Bank of Japan's potential interest rate hikes could further increase these costs, adding upward pressure on yields [3] Group 4: Fiscal Policy and Credit Ratings - Takashi aims to shift focus from annual budget balance to reducing the national debt-to-GDP ratio, currently around 230% [4] - The International Monetary Fund (IMF) predicts Japan's overall budget deficit, excluding net interest payments, will be 0.9%, the smallest decline since 1992 [4] - Fitch Ratings has no plans to downgrade Japan's credit rating, as it anticipates a shift towards more expansionary fiscal policies [4] Group 5: Market Dynamics and Political Landscape - Global investors, who move funds faster than long-term local holders, currently account for about 65% of monthly cash transactions in the Japanese government bond market [5] - The lack of action from the Bank of Japan during the bond yield panic in January indicates that such events are largely viewed as necessary growing pains of policy shifts [5] - Following the election results, Takashi indicated the need for negotiations with opposition parties on the consumption tax issue, leaving room for alternative solutions that may be cheaper or avoid the challenges of temporary tax cuts [5]

1. Report Industry Investment Rating No relevant content provided. 2. Core Viewpoints of the Report - In January 2026, the wealth management scale decreased seasonally, with an expected rebound of about 1 trillion in February and an increase of about 3 trillion for the whole year [2][7][11]. - In January 2026, the average monthly annualized yield of fixed - income wealth management products of wealth management companies rebounded, and the average annualized yield of cash - management wealth management products was low and stable [2][13][15]. - In the past two years, the cost rate of interest - bearing liabilities of A - share listed banks has declined rapidly, and it is expected to continue to decline in the future, which may support the bond yield to decline [16][19]. - The long - term bond yield may decline by 5 - 10BP again in the first quarter of 2026, and the 10Y Treasury bond yield is expected to fluctuate in the range of 1.6% - 1.9% [24][25]. - The steady growth of the wealth management scale will strongly support credit bonds within 3 years, and attention can be paid to the sinking opportunities of 3 - 5Y credit bonds [26]. 3. Summary by Relevant Catalogs 1.1 January Wealth Management Scale Seasonal Decline - As of the end of January 2026, the wealth management scale was 32.5 trillion yuan, a decrease of 0.8 trillion yuan from the end of the previous year. The decline in January 2026 was similar to that in 2021 when the Spring Festival was also late. The reasons included the bank's focus on deposit and loan business at the beginning of the year and the regulation of the "ranking" chaos of wealth management yields [5][7]. - It is expected that the wealth management scale will rebound by about 1 trillion in February, and the low deposit interest rate and year - end bonuses will drive the rebound. The wealth management scale is expected to increase by about 3 trillion in 2026 [7][11]. 2. How about the Yield of Fixed - Income Wealth Management Products in January 2026? - Since the beginning of 2022, the average performance comparison benchmark of newly issued RMB fixed - income wealth management products of wealth management companies has been declining. In January 2026, the upper limit of the average performance comparison benchmark was 2.68%, and the lower limit was 2.15%. It is expected that the lower limit will slowly drop to about 2.0% [12]. - In January 2026, the average 7 - day annualized yield of cash - management wealth management products was 1.24%, and that of money funds was 1.10%. The yield of money - related products is expected to be low and stable in the future [13]. - In January 2026, due to the improvement of the bond market and the strength of the stock market, the average annualized yield of fixed - income wealth management products of wealth management companies rebounded to 3.57%, and that of pure fixed - income wealth management products rebounded to 2.83% [15]. 3. Investment Suggestion: The Long - Term Bond Yield May Decline by 5 - 10BP Again - The cost rate of interest - bearing liabilities of A - share listed banks has declined rapidly in the past two years. It is expected to drop below 1.60% in 25Q4 and below 1.4% in 26Q4. In the next three to five years, the liability cost of commercial banks is expected to decline year by year, which may support the bond yield to decline [16][19]. - After the significant adjustment of long - term bonds, especially ultra - long - term bonds in December 2025, the long - term bonds rebounded since mid - January 2026, mainly driven by allocation funds. The risk of long - term bonds is relatively low, and the long - term bond yield may decline by 5 - 10BP in the first quarter of 2026 [22][23][24]. - The steady growth of the wealth management scale will strongly support credit bonds within 3 years. It is expected that wealth management will significantly increase the allocation of credit bonds with a remaining term of less than 3 years and allocate 5Y credit bonds through amortized cost open - end bond funds. Attention can be paid to the sinking opportunities of 3 - 5Y credit bonds [26].

Core Viewpoint - The recent significant rise in bond yields in South Korea is notable, with the 3-year government bond yield surpassing 3.2% while the policy rate remains at 2.5% [1] Group 1: Bond Market Insights - The current bond yields are considered to be in a relatively high range, above 2%, based on historical averages during periods when the policy rate is stable [1] - The increase in yields reflects various factors, including market expectations and strong stock market performance [1] Group 2: Economic Context - Despite the rise in yields, the current economic and inflation conditions have not deviated significantly from the inflation target or potential growth rate [1] - The current yield levels are perceived as "somewhat excessive" given the prevailing economic indicators [1]

Group 1 - The yield on the UK 10-year government bonds decreased by 3.0 basis points, reaching 4.476% [1] - The 2-year UK bond yield fell by 1.9 basis points, reported at 3.624% [1] - The 30-year UK bond yield dropped by 4.1 basis points, while the 50-year bond yield decreased by 3.8 basis points [1] Group 2 - The yield spread between the 2-year and 10-year UK bonds decreased by 1.171 basis points, now at +85.067 basis points [1]