Core Viewpoint - The U.S. federal government has entered a "shutdown" state, affecting approximately 750,000 federal employees and causing significant disruptions to public services and the macro economy [1][2]. Economic Impact - The government shutdown is expected to suppress GDP growth, with economists warning that it could reverse the strong growth momentum seen in the second quarter, where GDP annualized growth was 3.8% [2]. - If the shutdown continues until October 15, it may lead to significant political and social pressure, potentially prompting bipartisan negotiations [2]. Data Availability - The shutdown has resulted in the suspension of key economic data releases, including non-farm payroll reports, creating an "information vacuum" for traders [3]. - This lack of data is forcing market participants to adjust their investment strategies amid heightened uncertainty [3]. Political Stalemate - The root cause of the shutdown lies in the intense political battle between Democrats and Republicans over the continuation of subsidies under the Affordable Care Act (ACA) [3][4]. - Both parties have failed to pass temporary funding proposals, with the Senate rejecting both sides' plans, indicating a need for bipartisan support to move forward [4]. Market Resilience - Despite the short-term impacts of the shutdown, the U.S. capital markets have shown resilience, with the S&P 500 index up 14% year-to-date and reaching a historical high [5]. - Analysts predict a 8.8% year-over-year increase in third-quarter earnings for S&P 500 companies, indicating underlying market strength [5]. Consumer Confidence - The negative effects of the shutdown are beginning to impact consumer confidence, with warnings that restarting the government may be more challenging than initiating the shutdown [6]. - Delays in airport security due to staffing shortages and potential interruptions to nutrition assistance programs are contributing to a decline in consumer sentiment [6][7]. - There is a 71% probability that the government shutdown will extend beyond October 14, which could further affect the economy and market sentiment in the fourth quarter [7].

Group 1 - The U.S. stock market closed lower on Tuesday, with the S&P 500 index declining by 0.4% [3] - The government shutdown, stemming from budget disputes in Congress, has entered its third day, leading to delays in key economic data releases such as employment reports, which increases market uncertainty [3] - Historical performance of the S&P 500 index during non-recession periods shows that average returns remain positive, but an extended shutdown could trigger a debt ceiling crisis, amplify inflationary pressures, and weaken consumer confidence [3] Group 2 - The Hong Kong Stock Connect is suspended due to a public holiday in the domestic market [3]

Group 1 - The core viewpoint of the articles indicates a significant rise in consumer inflation expectations in the U.S., particularly among low-income and less-educated groups, with the one-year inflation expectation increasing from 3.2% in August to 3.4% in September, marking a recent high [1] - The five-year inflation expectation slightly increased from 2.9% to 3%, while the three-year expectation remained stable at 3% [1] - The Federal Reserve is closely monitoring changes in consumer inflation expectations to assess whether recent tariff policies will lead to temporary price increases or more persistent inflationary pressures [1] Group 2 - Consumer confidence continues to weaken, reflecting the dual pressures of high inflation and a slowing job market, with expectations of rising unemployment over the next 12 months [1] - There is a slight recovery in consumer confidence regarding job availability in the next three months, following a record decline in August [1] - In terms of personal financial situations, there is a divergence in consumer sentiment, with an increase in respondents believing their current financial situation has improved compared to last year, while those expecting their financial situation to worsen in the next year also increased, indicating fragile confidence in the economic outlook [2]

Core Insights - Australian consumer confidence has declined recently as the Reserve Bank of Australia decided to maintain interest rates and indicated that the inflation outlook may restrict further rate cuts [1] Group 1 - The Reserve Bank of Australia has kept interest rates on hold, which has contributed to the drop in consumer confidence [1] - The inflation outlook is a significant factor that may limit the possibility of future interest rate cuts [1]

Group 1 - The FOMC will release the minutes from its mid-September meeting, which may provide insights into future monetary policy decisions [1] - The University of Michigan will release the results of its consumer survey, which is expected to reflect consumer sentiment and spending trends [1] - This week will also bring earnings reports from Constellation Brands, which could impact the beverage industry and investor sentiment [1]

Group 1 - The Ministry of Commerce of China firmly opposes Mexico's recent anti-dumping investigations against Chinese products, including float glass and PVC-coated fabrics, and will closely monitor the investigation's progress to protect the legitimate rights of Chinese enterprises [2] - In October, the total cross-regional personnel flow in China was 30,177.02 million, a month-on-month decrease of 10.1% but a year-on-year increase of 6.4% [2] - The China Railway Group reported that on October 2, 19.288 million passengers were sent by rail, with a forecast of 18.25 million for October 3, indicating sustained high passenger flow [2] Group 2 - The Ministry of Commerce estimates that China's digital consumer spending will reach 23.8 trillion yuan in 2024, accounting for 44.2% of total consumer spending that year [2] - The China Council for the Promotion of International Trade organized 2,249 business groups to visit 102 countries and regions in 2024, averaging six groups per day [2] - The National Healthcare Security Administration reported that there are over 230 anti-cancer drugs in the national medical insurance catalog, covering more than 20 common cancers [2] Group 3 - Morgan Stanley reported a net inflow of $4.6 billion from foreign investors into the Chinese stock market in September, the highest monthly figure since November 2024, driven mainly by $5.2 billion inflow from passive funds [2] - The report noted that since mid-July, U.S. funds have significantly flowed into the Chinese stock market, with European passive funds also beginning to invest [2] - Active funds increased their holdings primarily in capital goods and semiconductors, while reducing their positions in insurance, durable goods, and apparel [2]

Group 1 - DraftKings shares fell 10.2% due to competitive pressures from privately held Kalshi and negative consumer sentiment data [1][5][8] - Kalshi, a private betting platform, has recently expanded into real-time sports betting and achieved record trading volumes over the weekend, posing a competitive threat to DraftKings [2][3][4] - Despite reporting a 45% increase in sports book handle revenue, DraftKings showed signs of potential deceleration with only an 11% increase in overall sports book betting volumes and flat unique visitor numbers [4][5] Group 2 - The recent consumer sentiment reading from The Conference Board was worse than expected, negatively impacting consumer discretionary stocks, including DraftKings [5][8] - DraftKings is currently trading at 28 times this year's earnings expectations and 18.6 times 2026 earnings estimates, which is not considered expensive for a growth company, but risks increase if growth decelerates or margins compress [9]

Economic Performance - Thailand's economy remains weak as of August, with private consumption slowing down and agricultural income decreasing by 10.8% year-on-year [1] - The consumer confidence index dropped from 51.7 to 50.1, indicating concerns over high living costs and geopolitical tensions [1] - Private investment in the capital goods sector saw a year-on-year increase of 23.6%, while new commercial vehicle registrations fell by 10.5% [1] Export and Tourism - August exports reached $27.7 billion, a 5.8% increase year-on-year, marking the 14th consecutive month of growth [1] - The number of foreign tourists visiting Thailand decreased by 12.8% year-on-year, while domestic tourism increased by 6.4% with 22.4 million Thai citizens traveling domestically [1] Industrial and Inflation Indicators - The industrial sentiment index slightly declined from 86.6 to 86.4 due to border conflicts and uncertainties related to U.S. tariff policies [1] - The purchasing managers' index rose to 52.7, reflecting an increase in new orders [1] Economic Stability - Overall economic stability remains good, with an inflation rate of -0.79% and a core inflation rate of 0.81% in August [2] - Public debt as a percentage of GDP stood at 64.5% as of July, compliant with fiscal discipline requirements [2] - International reserves reached $267.4 billion by the end of August, indicating strong external stability [2]

Group 1 - Boston Federal Reserve President Collins expressed an open attitude towards further interest rate cuts this year, contingent on supportive data, amidst expectations of easing inflation pressures next year [1] - Collins reiterated support for the recent 25 basis point rate cut by the Federal Reserve, suggesting that maintaining a "moderately tight" policy could help balance risks in the job market while restoring price stability [1] - Recent Federal Reserve meetings indicated that policymakers expect more rate cuts within the year and anticipate further easing in 2026, despite ongoing inflationary pressures from large tariffs imposed by the Trump administration [1] Group 2 - The latest data from the U.S. Labor Department showed that job vacancies remained stable at 7.23 million in August, only slightly up from the revised 7.21 million in July, indicating a significant decline since the peak in early 2022 [1] - The trend suggests a balance in labor demand, but also indicates reduced hiring by employers and longer times for unemployed individuals to find new jobs, reflecting a softening job market [2] - Consumer confidence data for September revealed a decline of 3.6 points to 94.2, marking a five-month low and falling short of market expectations, with both current and future expectations indicators weakening [2]

Investment Rating - The report does not explicitly provide an investment rating for the industry Core Insights - Consumer confidence in Japan rebounded in August, with the consumer confidence index rising to 34.9, up from 33.7 in July, marking the highest level since January [1][7] - The beverage sector experienced a sluggish peak season due to extreme high temperatures, leading to significant declines in sales for soft drinks and beer [2][14] - The retail sector saw a return to positive growth after seven months, with department store sales increasing by 2.6% year-on-year [2][33] Summary by Sections Macroeconomic Overview - Inflationary pressures eased, with the core CPI rising by 2.7% year-on-year in August, down from 3.1% in July, the lowest since March [1][9] - Real wages fell by 0.2% year-on-year in July, marking the seventh consecutive month of decline, despite nominal wages reaching a yearly high due to summer bonuses [1][7] Beverage and Beer Industry - The beverage and beer sectors faced a "peak season not booming" scenario, with extreme heat suppressing outdoor consumption and previous price increases affecting sales [2][14] - Major companies like Suntory and Asahi reported significant declines in soft drink sales, with Suntory down 18% and Asahi down 8% year-on-year in August [3][21] Essential Consumer Goods - Essential retail sales for major players like Aeon and 7-Eleven showed modest growth, with Aeon reporting a 2.1% increase in same-store sales [3][15] - The overall retail environment was impacted by high temperatures, which shifted consumer preferences towards indoor products [3][15] Discretionary Consumer Goods - The restaurant sector saw strong performance, with companies like Saizeriya and McDonald's reporting year-on-year same-store sales growth of 19.3% and 5.3% respectively [4][26] - Clothing retailers like ABC-MART and Uniqlo also experienced positive sales growth, with same-store sales increasing by 8.5% and 5.3% respectively [4][30] Tourism and Hospitality - The tourism sector continued its robust recovery, with foreign visitors to Japan reaching 3.428 million in August, a 16.9% increase year-on-year [2][38] - Domestic travel demand surged during the Obon holiday, contributing to increased hotel revenues [2][38] Stock Market Performance - The consumer sector underperformed the broader market in August, with the food and beverage index rising by only 1.3% compared to the overall market [5] - Investment recommendations focus on companies with optimistic profit outlooks, such as Saizeriya and Asahi Group [5]