Group 1: Core Views - The article discusses the significant growth of credit bond ETFs, with a total scale of 106.6 billion yuan as of June 20, 2025, an increase of 77.7 billion yuan since the end of March, and 41.7 billion yuan since June [1] - The expansion of index constituent bonds is notably slower than the growth of credit bond ETF scales, indicating a potential undervaluation in constituent bonds [1][2] - The article highlights the impact of low valuation transactions on bond valuations, particularly the widening valuation gap between exchange-traded corporate bonds and comparable bank bonds [2] Group 2: Market Dynamics - The article notes that the issuance of new science and technology bonds is primarily at low valuations, with an average coupon rate lower than the estimated average by 6 basis points [3] - It emphasizes that the secondary market's low valuation trend may extend to the primary market, suggesting potential opportunities in newly issued low-valuation science and technology bonds [3] - The article identifies two main lines for constituent bond exploration: bonds with a remaining term of over 5 years and those included in both the science and technology bond index and credit bond benchmark market [4] Group 3: Investment Opportunities - The article suggests that the demand for 3-5 year credit bonds is increasing due to the volume of credit bond ETFs, which may lead to a flattening of the yield curve and a narrowing of credit spreads for higher-rated bonds [2] - It recommends focusing on newly issued science and technology bonds with a low valuation of within -5 basis points, indicating potential for price appreciation [3] - The article indicates that the market for long-term science and technology bonds (over 5 years) is particularly attractive due to their larger scale and stable valuations [4]

Core Viewpoint - The intensification of great power competition is a long-term trend, leading to a positive outlook for the military industry [2][4]. Group 1: Market Performance - The military industry index declined by 2.39% last week, underperforming the broader market by 1.88 percentage points, ranking 22nd out of 29 sectors [3]. - The Shanghai Composite Index fell by 0.51%, and the ChiNext Index dropped by 1.66% during the same period [3]. Group 2: Domestic Developments - On June 20, China successfully launched the Zhongxing 9C satellite using the Long March 3B rocket, marking the 582nd flight of the Long March series [3]. - At the 55th Paris Air Show, China showcased advanced equipment such as the J-35A stealth fighter and the Wing Loong-10B drone, highlighting their capabilities for both air and naval operations [3]. - The Zhuque-3 reusable rocket's first-stage propulsion system completed a ground test, laying the foundation for reusable rocket technology in China [3]. - The third China-ASEAN Defense Think Tank Exchange promoted regional defense technology cooperation, enhancing practical collaboration in defense technology and joint exercises [3]. Group 3: International Military Dynamics - Iran launched a significant missile attack against Israel, escalating regional security tensions, with at least 25 ballistic missiles targeting Israeli defense facilities [4]. - A joint statement from 21 Arab and Islamic nations condemned Israel's airstrikes on Iranian nuclear facilities, emphasizing the need for diplomatic dialogue to resolve the crisis [4]. - Modern warfare demands higher standards for equipment informatization and intelligence, with a focus on advanced aircraft and communication equipment's strategic value [4].

Group 1 - Germany plans to borrow approximately 20% more than originally planned to address increased spending in the coming months [1] - A tax reduction agreement totaling €46 billion (approximately $53 billion) highlights the rising demand for German debt [1] - The German government aims to revitalize the sluggish economy and strengthen military capabilities under the leadership of Chancellor Friedrich Merz [1] Group 2 - The German cabinet has approved this year's budget and a mid-term financial plan, which includes a net increase in borrowing of about €500 billion by the end of 2029 [1] - The Federal Debt Management Agency plans to raise €118.5 billion in funds from July to September, which is €19 billion more than the initial plan announced in December [1] - The yield on 30-year German government bonds has risen by up to 10 basis points to 3.06%, the highest level since the end of May [1]

Core Viewpoint - The Trump administration plans to request a record national security budget of $1.01 trillion for the next fiscal year, starting October 1, which represents an increase of over 13% compared to the current fiscal year [1] Group 1: Budget Allocation - The proposed defense budget will fund the Iron Dome missile defense program, shipbuilding, nuclear modernization, and border security [1] - The budget includes a 3.8% pay raise for military personnel [1] Group 2: Historical Context - The 13% increase in the budget is reminiscent of defense spending under President Reagan [1] Group 3: Cost-Cutting Measures - As part of cost-cutting efforts by Elon Musk, the Trump administration aims to reduce some expenditures at the Pentagon while still seeking to increase the overall defense budget [1]