Core Viewpoint - The bond market is experiencing a correction, with government bond futures declining and interbank bond yields rising, indicating tightening liquidity as the month-end approaches [1][2]. Market Performance - Government bond futures closed lower across the board, with the 30-year main contract down 0.41% to 114.070, marking a new closing low since March 19 [2]. - Interbank bond yields mostly increased, with the 30-year government bond yield rising 1.3 basis points to 2.112% and the 10-year government bond yield up 1.4 basis points to 1.812% [2]. Overseas Bond Market - In North America, U.S. Treasury yields fell across the board, with the 10-year yield down 4.06 basis points to 4.106% [3]. - In Asia, Japanese bond yields also decreased, while in the Eurozone, the 10-year French bond yield rose by 0.4 basis points to 3.561% [3]. Primary Market - The Ministry of Finance's weighted average bid yields for 91-day and 182-day government bonds were 1.2473% and 1.3405%, respectively, with bid-to-cover ratios of 2.84 and 2.31 [4]. Liquidity Conditions - The central bank conducted a 7-day reverse repo operation of 401.5 billion yuan at a rate of 1.40%, resulting in a net withdrawal of 17 billion yuan for the day [5]. - Short-term Shibor rates increased, with the overnight rate rising 2.1 basis points to 1.434% [5]. Institutional Perspectives - Citic Securities noted that the urgency for the central bank to restart government bond trading is not strong in the short term, but the increased bond purchases by state-owned banks reflect a relatively loose liquidity environment [6]. - China International Capital Corporation (CICC) observed that while the bond market is experiencing volatility, credit bonds in the short to medium term are performing relatively well [7].

Core Viewpoint - The recent adjustment in the bond market has led to an expansion of the yield spread between ultra-long-term government bonds and 10-year government bonds, reaching a year-to-date high, but this trend is expected to stabilize with limited further expansion potential [1][3]. Group 1: Market Performance - Since mid-September, the yield spread between 30-year and 10-year government bonds has consistently remained above 30 basis points, peaking at 33.31 basis points on September 11 [1]. - The overall bond market has been adjusting, with ultra-long bonds showing relatively weaker performance, as the yield on 30-year government bonds did not experience significant downward movement despite the recovery in 10-year government bonds, which surpassed 1.8% [1][3]. Group 2: Factors Influencing Yield Spread - The widening yield spread for ultra-long bonds is attributed to multiple factors, including market risk appetite, supply, and funding conditions. The rise in stock market sentiment has weakened bond market sentiment, leading to a corresponding adjustment in bond yields [3]. - Since May, there has been a peak in the issuance of ultra-long special government bonds, which has contributed to the widening of the yield spread due to increased supply expectations [3]. Group 3: Future Outlook - Analysts from Zhongyou Securities predict that the yield spread for ultra-long bonds is unlikely to expand significantly, suggesting that it will not return to historical levels above 40 basis points prior to 2023 [5]. - The liquidity of ultra-long bonds is deemed crucial, and as long as liquidity remains stable, the yield spread is unlikely to revert to levels seen before 2024. Current liquidity conditions show no significant decline, maintaining a high turnover rate [5]. - The current high yield spread of 30 basis points between 30-year and 10-year government bonds indicates limited further adjustment space for ultra-long bonds, suggesting potential value for allocation and trading [5].

1. Report Industry Investment Rating No relevant content provided. 2. Core Viewpoints - This week, the bond market was relatively stable, with interest rates first declining and then rising. Market sentiment improved in the first half of the week as the market speculated on the central bank restarting treasury bond trading, leading to a decline in interest rates and credit bond yields. In the second half of the week, influenced by factors such as China - US negotiations, there was a slight upward movement. Credit spreads fluctuated slightly overall, with long - term credit spreads rising [2]. - Since the market adjustment began in July, institutional behavior has changed. Large banks have shifted from net selling to net buying of interest - rate bonds, mainly focusing on varieties with a maturity of less than 5 years. Funds and securities firms have sold more long - term interest - rate bonds, with relatively scattered buyers. For credit bonds, the net buying of wealth management products, insurance, and other product categories has been relatively stable. State - owned banks' purchase of short - term interest - rate bonds also contributes to short - end stability. The trading volume of long - term credit bonds has significantly decreased recently. It is speculated that the inflection point of the continuous upward trend of long - term credit bond yields is approaching [3]. - Compared with the year - to - date low in early July, the yields of medium - and long - term credit bonds with a maturity of 4 years and above have increased significantly. Compared with the high point in March, the yields of credit bonds with a maturity of less than 5 years have declined by more than 10bp, and the yields of ultra - long - term credit bonds are slightly higher than the year - to - date high. Looking forward to the fourth quarter, there is limited room for a significant reduction in credit bond spreads, but the stability of the short end is highly certain [4]. - Considering the current low funding rates, weak fundamentals, and the strong volatility - resistance ability of short - term bonds, short - term bonds with a maturity of around 2 years have good investment value. Currently, the price - ratio of Tier 2 and perpetual bonds (Two - Yong Bonds) to medium - term notes has reverted to the mean, reducing their trading value. Their future performance mainly depends on interest - rate trends. If interest rates decline, there is still room for further decline. The trading volume of ultra - long - term credit bonds has decreased significantly, and the yields of some varieties have exceeded the year - to - date high, making them suitable for allocation. However, for trading - oriented institutions, especially those with less stable liability ends, the trading opportunities in the fourth quarter are limited, and it is advisable to wait appropriately. For allocation - oriented institutions, they can gradually start allocating [5]. 3. Summary by Relevant Catalogs 3.1 Institutional Behavior and Point Observation 3.1.1 What are the characteristics of institutional behavior? - Since July, large banks have increased their net buying of interest - rate bonds, while funds and securities firms have increased their net selling. Large banks are more inclined to buy short - term interest - rate bonds rather than long - term ones. There is a mismatch in the maturity between the purchasing willingness of large banks and the selling willingness of funds and securities firms, which will affect the market trend. For credit bonds, the overall behavior is relatively stable. The net buying of insurance, wealth management products, and other product categories is relatively stable, while the selling of securities firms, city commercial banks, and joint - stock commercial banks is also relatively stable. Large banks' selling has decreased since July. The net buying of rural commercial banks in the secondary market of credit bonds has remained at a good level, but the overall volume is limited. Since the bond market adjustment in July, funds' demand for long - term credit bonds has weakened significantly, and they have continuously sold long - term credit bonds. Insurance's net buying of long - term credit bonds has declined to a relatively low level in recent weeks [10][14][18]. 3.1.2 Credit bond point observation - Compared with the year - to - date high on March 18, the current credit bond yields are still lower. Yields of bonds with a maturity of less than 2 years are about 30bp lower, those with a maturity of 3 - 5 years are about 20bp lower, and those with a maturity of more than 5 years are only about 5bp lower. Credit spreads are significantly lower than the high point in March, with spreads of bonds with a maturity of less than 5 years being about 20bp lower. Compared with the low point on July 7, the short - end adjustment of bonds with a maturity of 2 years and below is relatively small, while the adjustment of bonds with a maturity of more than 5 years is particularly large. The weak fundamentals and relatively loose funding rates provide a stable foundation for the short end. The relatively stable purchasing power of important buyers of credit bonds, such as insurance and wealth management products, and large banks' preference for short - term interest - rate bonds also indirectly support credit bonds [22][26][30]. 3.1.3 Investment thinking and suggestions for the portfolio - From the perspectives of the funding situation, institutional behavior, and anti - decline ability, appropriate credit risk - taking in short - term credit bonds is still worthy of attention. Currently, the volume of credit bonds with a remaining maturity of less than 3 years, a valuation of more than 2.1%, and an implicit rating of AA(2) and above exceeds 1 trillion yuan. The price - ratio of Two - Yong Bonds to medium - term notes has reverted to around 0, reducing their trading value. Their future performance depends on interest - rate trends. The yields of ultra - long - term credit bonds are close to the year - to - date high, and the trading volume has dropped to a low point. They have allocation value, and allocation - oriented institutions can gradually allocate [32][34][37]. 3.2 What to buy in credit? 3.2.1 It is recommended to focus on high - grade Two - Yong Bonds - This week, the price - ratio of AAA Two - Yong Bonds to medium - term notes has declined significantly. The price - ratio of 5 - year AAA - rated Tier 2 capital bonds to 5 - year AAA medium - term notes has dropped by more than 5bp this week. The price - ratio of short - term urban investment bonds to medium - term notes has declined significantly and is close to the year - to - date low, with relatively low cost - effectiveness. The price - ratio of long - term weak - quality urban investment bonds to medium - term notes has increased recently and is currently positive [41][43]. 3.2.2 Focus on high - coupon assets with a maturity of around 2 years - Currently, the proportion of urban investment bonds with a valuation of more than 2.2% is 38.6%, that of non - financial industrial bonds is 26.1%, and that of Two - Yong Bonds is 34.7%. Bonds with a maturity of around 2 years and a valuation of more than 2.2% have good value. For urban investment bonds, it is recommended to focus on bonds with a maturity of around 2 years issued by entities such as Xi'an High - tech Holdings Co., Ltd., Henan Airport Group Investment Co., Ltd., and Zhuhai Huafa Group Co., Ltd. For industrial bonds, it is recommended to focus on 2 - year bonds of important local state - owned real - estate enterprises and 2 - year or less bonds of non - real - estate industrial entities [45][47][49]. 3.3 Market Review: Yields Fluctuated 3.3.1 How was the market performance? - This week, credit bond yields fluctuated, with long - term yields generally rising and some bonds with a maturity of 7 years and above adjusting by more than 3bp, while short - term Two - Yong Bonds generally declined. Credit spreads showed a divergent trend, with short - term spreads decreasing significantly, and spreads of ultra - short - term bonds with a maturity of less than 1 year generally decreasing by more than 4bp. From a daily perspective, yields fluctuated upward this week, showing a V - shaped trend. Credit spreads also showed a divergent trend, with short - term spreads decreasing on Mondays and Fridays and long - term spreads widening significantly on Tuesdays and Wednesdays [51][55][56]. 3.3.2 Insurance's allocation strength declined, and funds turned to net buying - The scale of insurance companies' credit bond allocation decreased compared with the previous week. This week, the net buying scale of insurance was 8.092 billion yuan, a 36.8% decrease from the previous week. The net buying volume of ultra - long - term credit bonds with a maturity of more than 5 years was 2.204 billion yuan, with a slight increase in the增持 strength. Funds turned to net buying. This week, funds net - bought 6.331 billion yuan of credit bonds, mainly focusing on bonds with a maturity of 1 - 5 years, with an增持 scale of 11.869 billion yuan. However, they still continued to net - sell ultra - long - term bonds, selling 2.938 billion yuan this week. The scale of wealth management products remained basically the same as last week. As of September 14, the scale of bank wealth management products was 31.07 trillion yuan. The allocation strength of wealth management products was stable, and the allocation strength of other product categories increased slightly. This week, the增持 scale of wealth management products in credit bonds was 20.32 billion yuan, a 2.6% decrease from the previous week. The net buying scale of other products was 13.386 billion yuan, a 20.7% increase from the previous week [58][60][63]. 3.3.3 Transaction proportion: The proportion of transactions within 1 year remains low - The proportion of medium - and short - term transactions (within 3 years) of urban investment bonds and industrial bonds remains relatively high, and the proportion of transactions of Two - Yong Bonds with a maturity of 3 - 5 years is still not low, indicating that general credit bonds are shortening their duration, and Two - Yong Bonds still have strong trading characteristics [67].

Report Industry Investment Rating - No information provided in the given content. Core Viewpoints of the Report - The adjustment of the US and Chinese bond markets is mainly due to the "hawkish" outlook of US monetary policy and the expectation of fiscal stimulus in China. The US bond yield rebounded, and the focus of the domestic bond market may shift to the expectation of fiscal stimulus. The production price index decreased, and the average daily trading area of commercial housing in 30 large and medium - sized cities decreased compared to the same period last year [2]. Summary by Relevant Catalogs High - frequency Data Panoramic Scan - The report presents various high - frequency data on food, other consumer goods, commodities, energy, metals, real estate, shipping, etc. For example, the average wholesale price of pork decreased by 1.16% week - on - week and 26.81% year - on - year; the 30 - city commercial housing trading area increased by 2.79% week - on - week [16]. High - frequency Data and Important Macroeconomic Indicators Trend Comparison - There are multiple charts showing the relationship between high - frequency data and important macroeconomic indicators such as industrial added value, PPI, CPI, export volume, etc., like the relationship between copper spot price year - on - year and industrial added value year - on - year (+PPI year - on - year) [24]. Important High - frequency Indicators in the US and Europe - Charts display indicators such as the US weekly economic indicators, initial jobless claims, same - store sales growth, and the Chicago Fed Financial Conditions Index, as well as the implied prospects of interest rate hikes/cuts by the US Federal Reserve and the European Central Bank [90][101]. Seasonal Trends of High - frequency Data - The seasonal trends of high - frequency data are presented, including the average daily output of crude steel, production price index, and the trading area of commercial housing in 30 large and medium - sized cities, etc. [103][112]. High - frequency Traffic Data in Beijing, Shanghai, Guangzhou, and Shenzhen - The year - on - year changes in subway passenger volume in Beijing, Shanghai, Guangzhou, and Shenzhen are shown [162][165].

Group 1 - The report indicates that the credit bond market is experiencing a divergence in trends, with most credit bond yields rising and credit spreads showing mixed performance, particularly in the short-end segment [10][21] - It is suggested to focus on the 2-3 year credit bonds for yield opportunities, as their spreads are higher than the lowest points in 2024 and lower than the average spread since 2024, indicating potential for value [12][21] - The report highlights that the financial bonds have shown some recovery after significant adjustments, but the sentiment remains cautious with limited room for bullish positions [10][21] Group 2 - Key policies include the announcement of a loan from Shenzhen Metro Group to Vanke for debt repayment, totaling up to 2.064 billion yuan, with cumulative loans since 2025 reaching 25.941 billion yuan [3][14] - The Ministry of Finance reported that from January to August, the national general public budget revenue was 1.48198 trillion yuan, a year-on-year increase of 0.3%, with tax revenue slightly up by 0.02% [15][20] - The central bank is guiding commercial banks to provide loans to state-owned enterprises and financing platforms to settle overdue accounts, with a total debt scale of approximately 1.8 trillion yuan [4][16] Group 3 - The report notes that the secondary market for credit bonds is active, with a significant increase in trading volume observed [21] - The report emphasizes the importance of monitoring the adjustments in the credit bond market, particularly in the context of the upcoming policy changes and market conditions [10][21] - The report also mentions that the Shanghai Stock Exchange has optimized the bond repurchase business to stabilize market prices, which may lead to a narrowing of spreads for lower-rated bonds [4][13]

Report Industry Investment Rating No information provided in the content. Core Viewpoints - Last week, the economic growth data for August continued to decline compared to July, some stock indices slightly corrected, and the third call between the Chinese and US presidents this year led to a bond market that first rose and then fell, with ultra - long bonds experiencing a small decline. The trading activity of ultra - long bonds slightly decreased last week but remained very active. The term spread of ultra - long bonds narrowed, while the variety spread widened [1][11]. - As of September 19, the spread between 30 - year and 10 - year treasury bonds was 32BP, at a historically low level. The economic downward pressure in August continued to increase, with the estimated GDP year - on - year growth rate in August at about 3.8%, a further decline from July. With an 8 - month CPI of - 0.4% and PPI of - 2.9%, deflation risks persisted. The bond market adjustment was mainly due to the disappointment in 2024 and the change in macro - narrative. Considering the desensitization of stocks and bonds since late August and the still - sluggish economy in August, the bond market trading mainline is expected to shift to fundamentals, and the short - term bond market is expected to rebound from an oversold position [2][12]. - As of September 19, the spread between 20 - year CDB bonds and 20 - year treasury bonds was 7BP, at a historically extremely low position. The economic situation and reasons for the bond market adjustment were similar to those of 30 - year treasury bonds, and the short - term bond market was also expected to rebound from an oversold position [3][13]. Summary by Directory Weekly Review - **Ultra - long Bond Review**: The 8 - month economic data in August decreased compared to July, stock indices slightly corrected, and after the call between the Chinese and US presidents, the bond market first rose and then fell, with ultra - long bonds slightly falling. Trading activity slightly decreased but was still very active. The term spread narrowed, and the variety spread widened [1][11]. - **Ultra - long Bond Investment Outlook**: For 30 - year treasury bonds and 20 - year CDB bonds, the spreads were at low historical levels. The economic downward pressure in August increased, with low GDP growth and deflation risks. The bond market adjustment was due to two reasons, and the short - term bond market was expected to rebound from an oversold position [2][3][12]. - **Ultra - long Bond Basic Overview**: The balance of ultra - long bonds was 23.3 trillion. Local government bonds and treasury bonds were the main varieties. By remaining term, the 30 - year variety had the highest proportion [14]. Primary Market - **Weekly Issuance**: Last week, the issuance of ultra - long bonds was relatively large, with a slight increase compared to the previous week. In terms of varieties, treasury bonds, local government bonds, and bank sub - bonds had significant issuances. In terms of terms, 30 - year bonds had the largest issuance [19]. - **This Week's Planned Issuance**: The announced issuance plan for this week was 138.6 billion, all of which were ultra - long local government bonds [23]. Secondary Market - **Trading Volume**: Last week, the trading of ultra - long bonds was very active, with a turnover of 1245.3 billion, accounting for 13.4% of the total bond turnover. The trading activity slightly decreased compared to the previous week, with different changes in turnover and proportion for different varieties [27]. - **Yield**: Due to the decline in economic data and the call between the Chinese and US presidents, the bond market first rose and then fell, with ultra - long bonds slightly falling. The yields of different - term treasury bonds, CDB bonds, local bonds, and railway bonds had different changes [36]. - **Spread Analysis**: The term spread of ultra - long bonds narrowed last week, with a low absolute level. The variety spread widened, also with a low absolute level [47][48]. - **30 - year Treasury Bond Futures**: Last week, the main 30 - year treasury bond futures contract T2503 closed at 114.8 yuan, with a decrease of 0.04%. The total trading volume decreased significantly, and the open interest increased slightly [52].

Group 1 - The market's pricing expectations for "anti-involution" have strengthened since mid-September, leading to some recovery in the bond market, but significant adjustment pressure remains due to macro factors and limited buying power [1] - The current bond market adjustment since July differs from the one in the first quarter, as the central bank's liquidity tightening in Q1 forced financial institutions to reduce leverage, causing significant pressure on large banks' liabilities [3] - The yield curve of government bonds has shown a pronounced bear steepening characteristic in the current adjustment, with long bonds, especially ultra-long bonds, experiencing larger adjustments compared to the relatively stable performance of medium and short-term bonds [3] Group 2 - Since the third quarter, there has been a marginal improvement in the domestic economy, with easing U.S.-China trade tensions and a reduction in market risk aversion, but the "anti-involution" policy has created three negative effects on the bond market: supply contraction, rising prices, and increased risk appetite [5] - Recent trading pressures from funds have been significant, with a focus on selling ultra-long government bonds while buying short-term bonds, leading to a rapid decline in the duration of bond funds [5] - The performance of major institutions indicates a potential return of institutional buying power around the 10-year and 30-year government bond yields, but the sustainability of this trend remains to be observed [8]

Group 1 - The second batch of 14 sci-tech bond ETFs raised a total of 40.786 billion yuan, with the total scale expected to exceed 600 billion yuan after listing in late September [1] - The bond market is experiencing a slight adjustment, with major interbank interest rate bond yields rising by 1-2 basis points, and the 30-year main contract for government bonds falling by 0.17% [1] - The yield curve is widening, reflecting market dynamics between long-term inflation expectations and short-term liquidity easing, as the 10-year government bond yield surpassed 1.8% and the 30-year yield exceeded 2.1% [1] Group 2 - Investment strategies suggested include a barbell strategy to balance short-term liquidity and long-term interest rate expectations, focusing on high-rated urban investment bonds for liquidity premiums [3] - Short-term bonds are recommended for opportunistic buying, while caution is advised for long-term varieties [3] - Industry bonds should focus on sectors related to "anti-involution," with mid-to-high grade varieties of "two eternal bonds" offering good value [3]

Group 1 - The core viewpoint of the article highlights that Ping An's bond ETF (511030) has maintained the best performance in terms of drawdown control during the recent bond market adjustment, which began on August 10, 2025 [1] - The bond market experienced significant declines at the beginning of the week, with the 10-year government bond yield surpassing 1.83% and the 30-year government bond yield exceeding 2.11%, indicating a strengthening of pessimistic expectations [1] - The market sentiment improved on Friday after the central bank's expectations of resuming government bond trading emerged, leading to a recovery in bond prices [1] Group 2 - The bond market saw a rapid increase in long-term bond yields, with the yields reaching new highs during the week, particularly on Tuesday and Wednesday [1] - The overall bond market experienced a turnaround on Thursday, with sentiment beginning to recover after three consecutive days of decline [1] - By Friday, the sentiment further improved, resulting in a general decline in long-term bond yields across the market [1]

Core Viewpoint - The bond market is experiencing slight differentiation in trends, with government bond futures rising while interbank bond yields are showing a slight upward trend in the afternoon. The market is expected to stabilize after a significant adjustment last week, but the potential for bullish moves may not be present in the short term. Attention will be on the adjustment of bond market pressures and clearer positive signals in the future [1][6]. Market Performance - Government bond futures closed higher across the board, with the 30-year main contract up 0.21% to 115.400, the 10-year main contract up 0.12% to 107.805, the 5-year main contract up 0.07% to 105.655, and the 2-year main contract up 0.01% to 102.376 [2]. - Interbank major rate bond yields initially decreased before rising, with the 10-year policy bank bond yield increasing by 0.25 basis points to 1.937%, and the 10-year government bond yield rising by 0.35 basis points to 1.793% [2]. International Bond Market - In North America, U.S. Treasury yields rose collectively, with the 2-year yield up 0.99 basis points to 3.549% and the 10-year yield up 4.57 basis points to 4.070% [3]. - In Asia, Japanese bond yields for mid-term maturities weakened, with the 3-year and 5-year yields rising by 0.9 basis points and 2 basis points, respectively [3]. - In the Eurozone, 10-year bond yields increased, with French yields up 6.6 basis points to 3.505% and German yields up 6 basis points to 2.713% [3]. Funding Conditions - The central bank conducted a 2800 billion yuan reverse repurchase operation at a fixed rate of 1.40%, resulting in a net injection of 885 billion yuan for the day [5]. - The Shibor short-term rates mostly increased, with the overnight rate rising by 4.1 basis points to 1.408% [5]. Institutional Perspectives - Huatai Fixed Income suggests that new regulations on public fund sales and uncertainties regarding fund tax exemptions may reshape the bond market's institutional ecology, leading to a slight increase in interest rates [7]. - CITIC Construction Investment indicates that the current adjustment is primarily due to changing market expectations, but there is no basis for a rapid bear market in the current fundamental and funding environment [7]. - Shenwan Fixed Income notes that the risks facing the bond market are not solely due to the stock-bond relationship but also stem from redemption pressures on fixed-income products due to limited asset space [7].