1. Report Industry Investment Rating - The investment view is that the oil price will show a volatile and slightly stronger performance in the short - term, rated as "oscillating" [3] 2. Core View of the Report - Sanctions have raised concerns about supply, causing international oil prices to rebound strongly. OPEC+ continues to increase production, demand enters the off - season, and the geopolitical situation cools down. Supply and demand maintain a bearish performance. However, the easing of the US attitude towards Chinese tariffs and the disturbances of European and American sanctions on supply concerns lead to a short - term volatile and slightly stronger performance of oil prices [3][6] 3. Summary by Relevant Catalogs 3.1 Main Views and Strategy Overview - **Supply (Medium - to - long - term)**: EIA, OPEC, and IEA all show an increase in global crude oil production in 2025. OPEC+ plans to increase production moderately, and the overall supply situation is bearish [3] - **Demand (Medium - to - long - term)**: Different institutions have different predictions on demand, with EIA increasing the forecast, OPEC remaining unchanged, and IEA slightly reducing the growth rate forecast. Overall, it is rated as neutral [3] - **Inventory (Short - term)**: US commercial crude oil and refined product inventories have decreased, which is bullish for the market [3] - **Industrial Policy (Medium - to - long - term)**: OPEC+ continues to increase production moderately, and the IEA believes that the market may shift from tight balance to slight oversupply, which is bearish [3] - **Geopolitical (Short - term)**: Sanctions on Russia by the EU, the UK, and the US may lead to a tightening of Russian oil supply and push up oil prices, which is bullish [3] - **Macro - finance (Short - term)**: The Fed may stop shrinking its balance sheet, and China and the US will hold new economic and trade consultations, which is bullish [3] - **Investment View**: Oil prices will show a volatile and slightly stronger performance in the short - term [3] - **Trading Strategy**: Both unilateral and arbitrage strategies suggest waiting and seeing [3] 3.2 Futures Market Data - **Market Review**: Sanctions have raised supply concerns, and international oil prices have rebounded strongly. As of October 24, WTI crude oil rose 7.32% week - on - week, Brent crude oil rose 5.84% week - on - week, and SC crude oil rose 7.47% week - on - week [6] - **Month - to - month Spread and Internal - External Spread**: Near - month spreads have strengthened, and internal - external spreads have rebounded and expanded [9] - **Forward Curve**: Near - month spreads have strengthened [21] - **Crack Spread**: Gasoline and diesel crack spreads have declined [24] 3.3 Crude Oil Supply - Demand Fundamental Data - **Production**: Global crude oil production increased in September 2025. The US weekly crude oil production was 1362.9 million barrels per day, and the number of active drilling rigs increased [55][79] - **Inventory**: US commercial inventories decreased, Cushing inventories decreased, Northwest European crude oil inventories increased, and Singapore fuel oil inventories decreased [80][90] - **Demand**: In the US, gasoline implied demand increased, and refinery operating rates rose. In China, refinery capacity utilization decreased slightly [101][110] - **Refinery Profit**: The gross profit of Chinese main - refineries declined, and gasoline and diesel crack spreads declined [119] - **Macro - finance**: US Treasury yields declined slightly, and the US dollar index oscillated [131] - **CFTC Position**: The net short position of speculative traders in WTI crude oil decreased [140]

Investment Rating - The report indicates a shift in the Federal Reserve's approach, with expectations that quantitative tightening (QT) will end soon, particularly at the upcoming October FOMC meeting [12][18][27]. Core Insights - Major banks, including Goldman Sachs and JPMorgan, anticipate that the Fed will halt its QT process due to declining bank reserves, which have fallen below $3 trillion [7][13][21]. - The liquidity situation in the market is deteriorating, with increased borrowing costs and reduced balances in overnight reverse repurchase agreements (ON RRP), indicating greater friction in funding markets [19][22][23]. - The Fed's low tolerance for rate volatility and political pressures are contributing factors for an earlier end to QT, as the central bank aims to avoid past liquidity crises [19][24][25]. Summary by Sections - **Liquidity Conditions**: The report highlights that while overall liquidity remains ample, funding markets are experiencing significant frictions as ON RRP balances have dropped to nearly zero, leading to elevated funding rates [19][22]. - **Fed's Balance Sheet Management**: Analysts expect the Fed to initiate temporary open market operations (TOMO) to alleviate stress in funding markets, followed by reserve management purchases of approximately $8 billion per month starting January 2026 [20][21]. - **Market Reactions and Predictions**: Following recent market turbulence, several banks have revised their forecasts for the end of QT, with many now predicting it will conclude at the October meeting rather than later in the year [27][29][30].

Group 1 - The Chinese assets are becoming increasingly attractive, with the Nasdaq Golden Dragon Index rising by 1.66%, driven by significant gains in Alibaba (3.64%), Baidu (2.9%), and JD.com (2.1%) [1] - Goldman Sachs predicts a 30% increase in the Chinese stock market over the next three years, citing an 80% rebound in the MSCI China Index since its 2022 low and expected corporate earnings growth of 12% [1][2] - Morgan Stanley highlights that global capital allocation to Chinese stocks remains "pitifully low," indicating potential for further investment [1] Group 2 - Intel reported a third-quarter revenue of $13.65 billion, marking a significant turnaround from a loss of $0.46 per share last year, with a gross margin of 40% exceeding expectations [2] - The Federal Reserve may halt quantitative tightening (QT) as early as next week, which could lead to increased liquidity in the market, reversing the previous trend of withdrawing liquidity [2] - The WTI crude oil price surged by 5.62% to $61.79 per barrel, signaling a potential shift in global capital allocation as liquidity conditions change [4] Group 3 - Gold prices rose by 1.62% to $4,131 per ounce, with analysts suggesting that central banks and wealthy investors are accumulating gold, anticipating a new era of liquidity [4] - Goldman Sachs maintains a bullish outlook on gold, projecting a target price of $4,900 per ounce by the end of 2026, emphasizing the potential for upward price movement [4] - The current market dynamics suggest that the upcoming FOMC meeting in October could lead to significant shifts in global capital markets, particularly if the Fed stops its tightening measures [6]

Core Viewpoint - Deutsche Bank strategists expect the Federal Reserve to announce a halt to the reduction of its balance sheet in the upcoming policy meeting, rather than in December, to avoid a significant impact on its policy credibility following unexpectedly high repurchase rates this week [1] Group 1 - The Federal Reserve is anticipated to make a policy announcement next week [1] - The decision to halt balance sheet reduction is aimed at maintaining policy credibility [1] - High repurchase rates this week have influenced the timing of the Fed's announcement [1]

Core Viewpoint - Deutsche Bank strategists expect the Federal Reserve to announce the halt of balance sheet reduction in the upcoming policy meeting rather than in December to avoid a significant impact on its policy credibility following unexpectedly high repurchase rates this week [1] Group 1 - The Federal Reserve is anticipated to make a policy announcement next week [1] - The decision to stop balance sheet reduction is aimed at maintaining policy credibility [1] - High repurchase rates have prompted a reassessment of the timing for the announcement [1]

Economic Performance - In Jiangsu province, manufacturing sales revenue increased by 4.9% year-on-year in the first three quarters, accounting for 44.1% of total sales revenue, which is a 0.9 percentage point increase from the previous year, providing significant support for economic growth [1] - From January to August, the main policies supporting the manufacturing sector, including tax reductions and refunds, amounted to 182.5 billion yuan [1] Stock Market - On October 24, the stock market experienced a rebound, with the Shanghai Composite Index reaching a new high for the year, and the ChiNext Index leading the gains [4] - The total trading volume in the Shanghai and Shenzhen markets reached 1.97 trillion yuan, an increase of 330.3 billion yuan compared to the previous trading day [4] - By the market close, the Shanghai Composite Index rose by 0.71%, the Shenzhen Component Index increased by 2.02%, and the ChiNext Index surged by 3.57% [4] Industrial Development - The Ministry of Industry and Information Technology announced the seventh batch of national industrial heritage, with 32 sites including Yixing Qianshu Longyao from Jiangsu being recognized, expanding the province's industrial heritage "national team" [5] - The China Machinery Industry Federation reported that the added value of the machinery industry above designated size grew by 8.7% year-on-year in the first three quarters, outperforming the national industrial growth rate by 2.5 percentage points [6] - The automotive and electrical machinery sectors saw growth rates of 11.2% and 11.1%, respectively [6] Corporate Developments - Morgan Stanley will allow Bitcoin and Ethereum to be used as collateral for cryptocurrency [7] - Wedbush Securities analyst Dan Ives is optimistic about Tesla's future in artificial intelligence, autonomous driving, and robotics, predicting that Tesla's robots will enter households within the next two to three years [7] - NVIDIA announced a partnership with Uber to develop autonomous driving technology, utilizing Uber's extensive real-world driving data to train NVIDIA's Cosmos World foundational model [7]

Group 1: Gold Market Outlook - Morgan Stanley predicts that the average gold price will exceed $5,000 per ounce by Q4 2026, with a long-term target of $6,000 per ounce by 2028, based on expected investor demand and central bank purchases [1] - The analysis highlights that the current market consolidation is a healthy phenomenon, reflecting a supply-demand imbalance with high buyer interest and limited sellers [1] - The report emphasizes that gold remains a strong investment amid concerns over inflation, currency devaluation, and the Federal Reserve's interest rate cuts [1] Group 2: U.S. Economic Indicators - Barclays anticipates that the upcoming U.S. CPI data will need to be significantly higher than expected to alter the market's view on the Federal Reserve's interest rate cuts [2] - Morgan Stanley and Bank of America expect the Federal Reserve to end its balance sheet reduction earlier than previously forecasted due to rising borrowing costs in the dollar financing market [3] - The market is divided on when the Fed will conclude its quantitative tightening, with some institutions predicting an end in October while others expect a later conclusion [3] Group 3: Risk Assets and Inflation - State Street Global Advisors warns that investor optimism towards high-risk assets may be excessive, with expectations of rising inflation impacting the Federal Reserve's decisions [4] - Dutch International Group notes that the credit spread for U.S. corporate bonds is tightening, making them less attractive compared to euro-denominated bonds, amid rising risks [5] - Citigroup highlights that the recent rise in oil prices due to U.S. sanctions on Russia provides a hedging opportunity for producers, although geopolitical premiums may not last [6] Group 4: Japanese Economic Policy - Morgan Stanley suggests that the market's cooling expectations for a Bank of Japan rate hike this month may be overstated, indicating a potential rebound for the yen [7] - Dutch International Group points out that rising inflation in Japan could pave the way for a rate hike by the Bank of Japan in December, with consumer price inflation accelerating to 2.9% in September [8] Group 5: Cryptocurrency and AI Transition - Guojin Securities reports that overseas cryptocurrency mining companies are transitioning to AI data centers, leveraging low electricity costs and approved power quotas [8] - The report suggests focusing on companies with clear AI expansion plans and undervalued market positions during this transition [8] Group 6: U.S. Tariff and Inflation Outlook - CITIC Securities predicts that the U.S. Supreme Court will expedite the ruling on Trump's tariff legality, with potential implications for U.S.-China negotiations [9] - Minsheng Securities warns that rising core inflation in the U.S. could lead to a more cautious approach from the Federal Reserve regarding interest rate cuts, with inflation pressures expected to increase in Q4 [10]

Financial Data and Key Metrics Changes - For Q3 2025, the company reported net income of $0.53 per share, a significant improvement from a loss of $0.29 in Q2 2025 [5] - Book value increased to $7.33 as of September 30, 2025, compared to $7.21 on June 30, 2025 [5] - The total return for Q3 was 6.7%, a recovery from a negative return of 4.7% in Q2 [5] - The average portfolio balance rose to $7.7 billion in Q3 from $6.9 billion in Q2 [5] - Liquidity improved to 57.1% at September 30, 2025, up from 54% at June 30, 2025 [5] Business Line Data and Key Metrics Changes - The weighted average coupon of the portfolio increased from 5.45% to 5.53% [32] - The effective yield rose from 5.38% to 5.51%, while the net interest spread expanded from 2.43% to 2.59% [32] - The portfolio remains 100% agency RMBS, with a focus on call-protected specified pools [30] Market Data and Key Metrics Changes - The cash Treasury curve showed a slight steepening, reflecting market expectations of Federal Reserve rate cuts due to labor market deterioration [6][9] - The long end of the Treasury curve performed well, with strong demand in the investment-grade corporate market despite tight credit spreads [10] Company Strategy and Development Direction - The company is focused on maintaining a conservative leverage posture while enhancing the carry and prepayment stability of its portfolio [32][39] - The strategy includes investing in high coupon specified pools to provide better income stability and call protection [30][43] - The company anticipates potential tailwinds from Federal Reserve rate cuts and the end of quantitative tightening, which could benefit the agency RMBS market [44] Management's Comments on Operating Environment and Future Outlook - Management noted a potential crossroads for the economy, with labor market weakness prompting possible Federal Reserve rate cuts, while also observing strong consumer resilience [46][47] - The company expects to adjust hedges to lock in lower funding rates and prepare for potential future rate hikes [48] Other Important Information - The company raised $152 million in equity capital during the quarter, which was fully deployed into high-quality specified pools [29][43] - The portfolio's exposure includes 20% backed by credit-impaired borrowers and significant holdings in Florida and New York pools [32] Q&A Session Summary Question: Given the positive developments, is there anything on the horizon that would change overall risk positioning? - Management indicated that if the Federal Reserve continues to cut rates and the economy rebounds, they may consider increasing leverage [51][52] Question: What is the outlook for payouts on high coupon spec pools? - Management noted that payouts have increased sharply, and they have benefited from acquiring pools at historically wide spread levels [54] Question: Are there scenarios where dollar roll specialness would return to the market? - Management expressed skepticism about the return of dollar roll specialness, citing the Federal Reserve's focus on buying Treasuries and bills rather than MBS [62] Question: What is the current supply and availability for longer-dated repo? - Management mentioned that spreads for longer-dated repo are currently too wide, but they are opportunistically looking to lock in funding [64][65] Question: What percentage of the portfolio has call protection? - Almost 100% of the portfolio has some form of call protection, which is crucial in a declining rate environment [72]

当美联储政策制定者们下周开会决定是否再次降息时，他们还将面临另一个日益紧迫的问题——何时应停止缩减该央行规模达6.6万亿美元的证券投资组 合。 由于量化紧缩(QT)可能加剧流动性约束并引发市场动荡，美联储今年早些时候已放缓每月债券持有量的缩减步伐。然而，数周以来，货币市场发出了更多警 告信号，显示量化紧缩进程可能已经走到尽头。 对许多华尔街人士而言，如果美联储想避免2019年9月货币市场剧烈动荡的重演，就必须迅速行动。当时，美联储在再次收紧资产负债表时导致短期利率飙 升，威胁到其对融资成本和整体经济的控制能力。 美国银行美国利率策略主管Mark Cabana表示："你完全可以认为，美联储不仅面临风险——他们实际上已经进入了'中间地带'。这多少有点像2019年的回 响，美联储可能过度抽走了系统中的流动性，而他们自己也很清楚这一点。" 美国银行与摩根大通本周加入了道明证券与Wrightson ICAP的行列，预期美联储将在10月会议上结束量化紧缩。另有几家机构则将结束时间的预测从明年初 提前至今年12月。 最新的信号是，美国银行体系准备金本周跌破3万亿美元关口，为连续第二周下滑。美国银行体系的准备金水平是美联储决 ...

Market Overview - US stock index futures are all up ahead of the market opening, with Dow futures up 0.16%, S&P 500 futures up 0.33%, and Nasdaq futures up 0.50% [1] - European indices are showing slight declines, with Germany's DAX down 0.11%, UK's FTSE 100 down 0.06%, France's CAC40 down 0.57%, and the Euro Stoxx 50 down 0.20% [1] Oil Prices - WTI crude oil is up 0.60% at $62.16 per barrel, while Brent crude oil is up 0.55% at $66.35 per barrel [2] Economic Data - The US September CPI report is highly anticipated, with economists predicting a month-on-month increase of 0.4% and a year-on-year increase of 3.1%, which is a 0.2 percentage point rise from August [3] - Core CPI, excluding food and energy, is expected to rise 0.3% month-on-month and remain at 3.1% year-on-year, consistent with August [3] - The potential for market volatility is heightened due to the lack of recent economic reports caused by government shutdowns [3] Federal Reserve Outlook - Economists expect inflation to remain elevated due to tariffs increasing goods prices, but BlackRock's strategist believes the CPI data will not alter the Fed's decision in the upcoming meeting [4] - The probability of a 25 basis point rate cut in the October meeting is 98.9%, and 96.1% for December [4] AI Sector Insights - Goldman Sachs expresses skepticism about the AI bubble, stating that while some warning signs exist, the tech sector has not yet entered a bubble phase [5] - The firm highlights the significant cash flow generation and stock buybacks by the "Magnificent Seven" tech companies, which were not common during previous bubbles [5] Banking Sector - The US banking system's reserves have fallen below $3 trillion for the second consecutive week, impacting the Fed's asset reduction strategy [6] - Analysts expect the Fed to halt the reduction of its $6.6 trillion balance sheet in the upcoming meeting [6] Treasury Yield Impact - The 10-year US Treasury yield is at a critical point, with potential movements depending on the CPI data release [7] - Higher-than-expected inflation could lead to a significant rise in yields, while lower-than-expected inflation could initiate a new bull market in equities [7] Gold Market - The ongoing US government shutdown is likely to extend, increasing uncertainty and boosting demand for gold as a safe haven [8] Company-Specific News - Google (GOOGL) has secured a deal with Anthropic for up to 1 million AI chips, valued at several billion dollars, enhancing its position in the AI infrastructure market [9] - Intel (INTC) reported Q3 revenue of $13.7 billion, a 3% year-on-year increase, and a significant turnaround with an adjusted EPS of $0.23, exceeding expectations [10] - Ford (F) faces a $2 billion profit impact due to a fire at a key supplier for its F-150 model, but reported strong Q3 earnings with an adjusted EPS of $0.45 [11] - Procter & Gamble (PG) exceeded Q1 sales expectations with $22.39 billion, driven by strong consumer demand despite price increases [12] - Sanofi (SNY) reported Q3 revenue of €12.43 billion, a 2.3% year-on-year increase, driven by strong sales of its Dupixent drug [12] - Eni (E.US) announced a 20% increase in its stock buyback plan to €18 billion due to improved cash flow and profit performance [13] - Newmont Mining (NEM) reported Q3 revenue of $5.52 billion, a 19.7% year-on-year increase, but saw a decline in stock price due to lower production levels [13]