Macro Insights - The Caixin China Manufacturing PMI fell to 48.3 in May, marking the first contraction since October of the previous year, with production and new orders both dropping to their lowest levels since December 2022 and October 2022 respectively [3] - The OECD has revised down its global GDP growth forecast for 2025 to 2.9%, previously at 3.1%, and also lowered the 2026 forecast from 3.0% to 2.9% [4] Bond Market Insights - In May, the issuance of ETFs experienced a decline for the fourth consecutive month, with only 11.068 billion units issued, the lowest in five months, while bond funds dominated the market with a 55.07% share [6] Corporate Alerts - Longshan City Investment announced that its chairman is under investigation for serious violations of discipline and law [7] - The Shaanxi Xixian New Area Development Group has 70.399 billion yuan in restricted assets, accounting for 88.87% of its net assets, with overdue financing amounts reaching 443 million yuan [8] - Shenzhen Longguang Holdings announced that its restructuring and grace period proposals were not approved, with total debts of 27.8532 billion yuan as of April 30, 2025 [9] - The Qinhan New City project has generated only 8.1 million yuan in revenue against an expected 260.2 million yuan due to macroeconomic slowdown [10] - Wenzhou Public Utilities Group reported an increase in borrowings of 3.824 billion yuan, representing 29.52% of its net assets as of the end of the previous year [11] Stock Market Insights - The Shenzhen Component Index and ChiNext Index will undergo sample adjustments, effective June 16, with multiple stocks being added [13] - NIO reported a Q1 2025 adjusted net loss of 6.279 billion yuan, compared to a net loss of 4.903 billion yuan in the same period last year [15] Industry Alerts - The Ministry of Commerce responded to the EU's proposed restrictions on Chinese companies participating in public procurement for medical devices, condemning it as a discriminatory measure [36] - The National Federation of Industry and Commerce's automotive dealers' association called for a resistance against "involutionary" competition, particularly price wars [37] - The domestic refined oil prices have increased for the fourth time this year, with gasoline and diesel prices rising by 65 yuan and 60 yuan per ton respectively [39] - The China Coal Transportation and Marketing Association reported weak coal consumption since April, with high inventory levels and declining prices [40]

Group 1 - The report highlights a significant market style shift, indicating that the notion of "cutting high to low" is inaccurate, and "avoiding high positions" is more appropriate. This is evidenced by the performance of various industries during the specified periods [1][14]. - The report identifies two underlying logics for industries performing well under the "avoiding high positions" context: one is related to policy games, particularly in the large consumption sector, driven by local policies such as the childcare subsidy in Hohhot [2][19]. - The report suggests that while the large consumption sector may face challenges in broad-based gains, there is potential for continued strength in the childcare subsidy theme, which could see further local policy catalysts [2][20]. Group 2 - The report notes that some industries, such as engineering machinery and ordinary steel, have shown independent market trends, indicating that identifying sectors with improving fundamentals is crucial for potential gains [3][21]. - The report emphasizes that the ability to achieve independent market trends is limited, and it is advisable to wait for clear upward price trends in non-hot sectors before participating [3][21]. - The report also mentions that the current market style shift is driven by policy games and low-position hedging, which differs from the independent market trends previously observed [21]. Group 3 - The report indicates that the large consumption sector has led the A-share market to a new high, with significant contributions from policies aimed at boosting consumption and childcare subsidies [6][30]. - The report highlights that the A-share index has shown a general upward trend, with essential consumer and discretionary sectors outperforming, while technology stocks have faced regulatory scrutiny and declining trading sentiment [7][39]. - The report provides insights into the performance of various sectors, with beauty care, food and beverage, and coal showing notable gains, driven by policy catalysts and low-position hedging logic [39].