Core Viewpoint - The recent commitment from both China and the U.S. to take measures by May 14, 2025, to modify or cancel tariffs and non-tariff countermeasures has eased concerns over escalating trade tensions, leading to a slight rebound in aluminum prices due to improved demand expectations [1] Industry Summary - The operating rate of domestic aluminum processing leading enterprises increased by 0.3 percentage points week-on-week to 61.9%, with a mixed performance across different sectors [1] - The operating rate for aluminum plate and strip leading enterprises decreased by 0.4 percentage points to 67.2%, attributed to a lack of new orders [1] - The operating rate for aluminum wire and cable increased by 1.4 percentage points to 65.6%, driven by the commencement of power transmission and transformation orders and the execution of previous orders [1] - The operating rate for national profiles slightly decreased by 1.5 percentage points to 57.5%, with some enterprises reporting a minor decline in operations [1] - Some photovoltaic sample enterprises maintained high operating rates, while others reported a decline in photovoltaic output to address weakening future demand [1] - Construction material enterprises reported weak order growth, focusing on maintaining current production levels [1] Inventory and Price Outlook - As of May 12, the inventory of electrolytic aluminum ingots in major domestic consumption areas was 601,000 tons, a decrease of 19,000 tons from the previous Thursday and a decrease of 35,000 tons from the previous Tuesday [1] - It is expected that domestic aluminum ingot inventory may break below the 600,000-ton mark this week [1] - Short-term macroeconomic improvements are expected to support prices, but there remains pressure above key price levels, with expectations of price fluctuations within a range as consumption enters a low season and inventory pressures accumulate [1] - The industry outlook suggests a focus on macroeconomic sentiment and downstream operating rates in the short term, with attention to potential risks from macro expectations, geopolitical developments, mining recovery, and consumption release [1]

Core Insights - The logic behind the steepening of the government bond yield curve may change following the recent Sino-US Geneva joint statement, suggesting that short-term adjustments could further open up long-term bond betting opportunities. Investors are advised to remain patient and focus on mid-to-short duration bonds during this phase [1][2][17]. Understanding the Sino-US Joint Statement - On May 12, the Ministry of Commerce released the Sino-US Geneva Economic and Trade Talks Joint Statement, which indicates a significant reduction in tariffs beyond market expectations. The US will split its 34% reciprocal tariff into two parts, maintaining a 10% baseline tariff while suspending the remaining 24% for 90 days. This results in a substantial decrease from the peak tariff rate of 145% during previous negotiations [1][9][10]. - The establishment of a bilateral consultation mechanism is aimed at facilitating ongoing discussions regarding economic and trade relations, which could help manage trade friction and pave the way for further tariff reductions [10][11]. Changes in Bond Yield Curve Logic - The overall direction of the steepening of the bond yield curve remains unchanged, but the internal logic may experience some shifts. Following the central bank's "double reduction" policy, short-term interest rates have significantly decreased, positively impacting the short-term bond market [2][15][17]. - For long-term bonds, the easing of trade tensions may shift market sentiment from profit-taking to increased risk appetite, as evidenced by a 6.25 basis point rise in the 30-year bond yield to 1.905% on May 12 [2][16][17]. Investment Strategy Recommendations - Investors are encouraged to maintain a concentrated position in mid-to-short duration bonds during this adjustment period, utilizing a "reverse triangle" strategy for building positions [2][17].