Core Viewpoint - Japan's Finance Minister, Shunichi Suzuki, indicated that if current revenue sources are insufficient to support Prime Minister Fumio Kishida's upcoming economic stimulus plan, the government may need to issue additional national bonds for financing [1][2]. Group 1: Economic Stimulus Plan - The economic stimulus plan is a priority for Prime Minister Kishida, aimed at addressing inflation and other challenges, and is expected to include measures to stabilize prices and increase defense spending [1][2]. - The supplementary budget for the stimulus plan is anticipated to be adequate to meet its goals, although it may not be excessively large [2]. Group 2: Tax Considerations - The government is considering a reduction in the food sales tax as part of an agreement with the Japan Innovation Party, but Finance Minister Suzuki emphasized the need to carefully evaluate various factors, including the tax's role in social security funding and the technical challenges of implementing such adjustments [2][3]. Group 3: Debt Management and Market Reactions - Concerns over fiscal expansion have led to an increase in Japan's long-term government bond yields, with the 30-year bond yield reaching a historical high of 3.3% earlier this month [3]. - The Bank of Japan is reducing its bond purchase scale, which has raised supply and demand concerns in the market [3]. Group 4: Bond Issuance Strategy - The government is preparing to issue various types of bonds, including floating-rate bonds linked to short-term interest rates, and is considering expanding the definition of qualified individual investors to include non-profit organizations and medical corporations [4]. Group 5: Leadership and International Relations - Shunichi Suzuki recently became Japan's first female Finance Minister, following Prime Minister Kishida's historic appointment as the first female Prime Minister [5]. - Following a joint interview, Suzuki had a brief conversation with U.S. Treasury Secretary Janet Yellen, indicating plans for a face-to-face meeting during President Trump's upcoming visit to Japan [5][6].

Group 1 - Germany commits to invest €37.2 billion in infrastructure by 2025, increasing to €60 billion annually by 2029, with Italy and Spain also advancing national recovery plans [1][2] - The investment cycle in Europe is accelerating, leading to higher financing issuance and corporate activity in sectors like energy infrastructure, construction, and industrial technology [2][4] - The European economy is facing challenges, but resilience is evident as fiscal resources are expected to convert into productive investments, impacting corporate profitability and market activity [4][5] Group 2 - The "Made for Germany" initiative aims to invest over €735 billion in the German economy over the next three years, marking a shift towards proactive capital deployment [7] - Capital markets have reacted positively to Germany's new fiscal and investment plans, with infrastructure sectors performing well and European stock valuations remaining attractive compared to the U.S. [8] - Potential investment opportunities are identified in clean energy, grid and transport infrastructure, digital systems, and advanced manufacturing, despite some execution risks [8][9] Group 3 - The EU and China are important trade partners, with bilateral trade reaching $614 billion in the first nine months of the year, indicating growth despite some challenges [8][9] - High-end manufacturing and green energy are highlighted as areas for potential collaboration, with both regions having shared commitments to climate action and sustainable growth [9]

Political Context - On October 21, 2025, Sanna Takichi was elected as Japan's 104th Prime Minister with support from the Japan Innovation Party, despite challenges from the Komeito party's exit from the ruling coalition[2][3] - The new government is expected to maintain a loose fiscal policy, but may need to compromise on specific policies due to political capital depletion during cabinet formation[5] Economic Policy - The new ruling coalition has shifted towards more expansionary fiscal policies compared to the previous Liberal Democratic Party (LDP) and Komeito coalition, focusing on inflation mitigation measures such as abolishing temporary gasoline taxes and exempting food consumption taxes for two years[4][9] - The coalition's economic strategy includes increased public investment in semiconductor, AI, energy security, and defense, aiming to support domestic demand and improve income expectations for businesses and residents[5] Monetary Policy Outlook - The Bank of Japan (BOJ) is likely to avoid raising interest rates in the early days of the new government, with expectations of maintaining a loose monetary policy stance[5][6] - Japan's Consumer Price Index (CPI) has exceeded the 2% target for 37 consecutive months, indicating a need for reevaluation of the yen's real exchange rate[6] Market Implications - Short-term market reactions may revert to "Takichi trading," characterized by rising Japanese stocks, increasing bond yields, and yen depreciation[6] - Long-term, the real exchange rate of the yen requires reassessment, potentially through gradual appreciation or inflation-driven asset price increases[6]

Group 1 - Morgan Stanley suggests shorting the dollar in a "blonde girl" environment where US stocks rise while Treasury losses are controlled [1] - Bank of America warns that tightening credit conditions may trigger passive selling, indicating potential bear market signals for the stock market [1] - Goldman Sachs expects a 0.3% month-on-month increase in both overall and core CPI for September, maintaining core inflation around 3.1% [2] Group 2 - Societe Generale indicates that a mild recession in the US could lead to a weaker dollar due to potential rate cuts [3] - UBS believes that the Bank of Japan is likely to raise interest rates in the coming months, supported by rising long-term inflation expectations [4] - Citigroup does not anticipate that the new Japanese Prime Minister will pressure the Bank of Japan to avoid rate hikes, given the current economic context [5] Group 3 - Goldman Sachs predicts Brent crude oil prices will drop to $52 per barrel by Q4 next year, citing inventory increases and refining margins [8] - Singapore Bank notes that investors may still be keen to increase gold allocations during price pullbacks, raising their 12-month gold price forecast to $4,600 per ounce [9] - Canadian banks forecast record corporate earnings for Q3, supporting the Toronto stock market's upward trend [10] Group 4 - Huachuang Securities reports a recovery in fund allocations to credit bonds, suggesting opportunities in 4-5 year maturities [11] - Galaxy Securities highlights a market style shift benefiting the food and beverage index, with a focus on new consumption trends [12] - CITIC Securities observes a divergence in economic data for September, with production remaining resilient while demand indicators decline [13] Group 5 - CITIC Securities notes that recent adjustments to Hainan's duty-free shopping policy could boost sales, enhancing consumer experience and increasing foot traffic [14] - CITIC Securities also reports advancements in solid-state battery technology, which may accelerate the commercialization process [15]

Core Viewpoint - The recent fluctuations in the global non-ferrous metals market are driven by the evolving US-China trade relations and tariff policies, but the fundamental drivers of the industry remain unchanged [1] Group 1: Supply and Demand Dynamics - The global supply chain is undergoing restructuring, with increasing "resource nationalism" leading to supply constraints for key minerals like copper and rare earths [2][3] - The competition for resources is intensifying due to strategic industries such as AI, new energy, and semiconductors, which are resource-intensive [2] - Supply-side constraints are exacerbated by insufficient capital expenditure in mining over the past decade and geopolitical tensions affecting key mineral exports [2][3] - The cobalt market is expected to shift from surplus to shortage by 2025, while Chile's copper production forecasts have been downgraded, further tightening supply [2] Group 2: Structural Changes in Demand - Demand is becoming more strategic and rigid, driven by technology and manufacturing rather than traditional real estate cycles [3] - Countries are motivated to stockpile resources even at high prices to ensure supply chain security, with the US planning significant tungsten purchases in the coming fiscal years [3] Group 3: Macroeconomic Environment - The Federal Reserve has entered a rate-cutting cycle, which is expected to lower the opportunity cost of holding non-yielding assets like gold and enhance the purchasing power of metal prices [4] - Major economies are entering a fiscal expansion phase, with significant government investments expected to drive demand for industrial metals like copper and aluminum [4] - Goldman Sachs predicts a substantial increase in global copper demand for defense purposes by 2030, reflecting the tangible impact of fiscal policies on metal demand [4] Group 4: Investment Opportunities - Gold is viewed as a "credit anchor" amid geopolitical tensions and high sovereign debt, with central banks expected to increase their gold reserves significantly by 2025 [7] - Copper is identified as a cornerstone for energy transition and AI revolution, with demand expected to surge while supply remains constrained [8] - Small metals like cobalt and rare earths are positioned as strategic assets, with potential price increases due to supply restrictions and geopolitical factors [9] Group 5: Market Sentiment and Strategy - The current volatility in the non-ferrous metals sector is seen as a pause in a bull market, with underlying logic intact and opportunities still present [10] - Patience is advised for investors, as the majority of companies in the non-ferrous sector are expected to remain profitable by 2025 [11] - A diversified approach is recommended for investing in small metals, while maintaining a focus on gold and copper during market fluctuations [12]

Investment Rating - The report maintains a "Positive" investment rating for the non-ferrous and steel industry in China [6]. Core Viewpoints - The report emphasizes the importance of future positioning rather than past defensive strategies, suggesting that investors should focus on opportunities for excess returns in the upcoming year [9][15]. - Gold prices are expected to experience high volatility in the short term but are projected to reach new highs in the medium term due to credit and safe-haven demand [16]. - The rare earth sector is anticipated to maintain its strategic importance despite short-term price declines, with a widening supply-demand gap expected in the medium term [17]. - The copper market is viewed positively, with expectations of price increases in the medium term, encouraging investors to buy on dips [17]. Summary by Sections 1. Non-Ferrous Metals - Gold: Short-term volatility is high, but medium-term prospects are strong with expectations of new highs supported by credit and safe-haven demand [16]. - Rare Earths: Short-term price declines do not diminish the medium-term strategic position, with an anticipated widening supply-demand gap [17]. - Copper: Strong medium-term price outlook, with a recommendation to buy on dips due to expected economic recovery and increased manufacturing investment [17]. 2. Steel Industry - Profitability: Short-term profitability is under pressure, with both prices and costs declining [28]. - Supply and Demand: Weekly rebar consumption decreased to 2.2 million tons, down 8.84% week-on-week and 14.77% year-on-year [24][18]. - Inventory: Both social and steel mill inventories have increased, indicating a potential oversupply situation [25]. - Prices: The overall steel price index has slightly decreased, with specific products like hot-rolled steel experiencing a notable drop [38]. 3. New Energy Metals - Supply: Significant increase in lithium production, with August 2025 output reaching 80,040 tons, up 46.54% year-on-year [42]. - Demand: High growth in new energy vehicle production and sales, with August 2025 figures showing a 26% increase year-on-year [48]. - Prices: Lithium prices have risen, with battery-grade lithium carbonate averaging 75,750 yuan per ton, reflecting a 3.55% week-on-week increase [55].

Report Summary 1. Report Industry Investment Rating No relevant content provided. 2. Core View The expectation of US fiscal and investment expansion, combined with factors such as the weakening US employment market, the ongoing shutdown crisis of the US federal government, the expansion of fiscal deficits in multiple countries, and geopolitical risks, will support precious metal prices in the medium to long term [1]. 3. Summary by Related Catalogs Market Data - **Gold**: Shanghai gold's closing price was 897.74 yuan/g, with a trading volume of 63,730. The inventory was 70,728 kilograms. International gold's COMEX futures active - contract closing price was 3,912.10 dollars/ounce, with a trading volume of 296,956 and a position of 379,094. The London gold spot price was 4,095.95 dollars/ounce [1]. - **Silver**: Shanghai silver's closing price was 11,531 yuan/ten - grams, with a trading volume of 1,701,266. International silver's COMEX futures active - contract closing price was 47.52 dollars/ounce, with a trading volume of 132,137 and a position of 131,902. The London silver spot price was 51.24 dollars/ounce [1]. - **Other Commodities**: INE crude oil was 479.70 yuan/barrel, ICE Brent oil was 63.39 dollars/barrel, NYMEX crude oil was 58.24 dollars/barrel, Shanghai copper futures were 85,120 yuan/ton, and LME spot copper was 10,802 dollars/ton [1]. - **Stock Indexes**: The Shanghai Composite Index was 3,862.5317, the S&P 500 was 6,654.7200, the UK FTSE 100 was 9,442.8700, and the French CAC40 was 7,934.2600 [1]. Important Information - The US Treasury Secretary plans to adjust the payment order to ensure the military payroll during the government shutdown [1]. - The US Department of Defense plans to spend 1 billion dollars to accelerate the purchase of critical minerals, and JPMorgan Chase announced a 1.5 - trillion - dollar US investment plan over ten years [1]. Trading Strategy Investors are advised to mainly build long positions after price corrections. For London gold, pay attention to the support level around 3,400 - 3,500 and the resistance level around 4,065 - 4,381; for Shanghai gold, the support level is around 790 - 810 and the resistance level is around 940 - 1,010. For London silver, the support level is around 30 - 37 and the resistance level is around 50 - 57; for Shanghai silver, the support level is around 7,200 - 8,500 and the resistance level is around 13,000 - 14,800 [1].

Summary of Key Points from Conference Call Industry Overview - The discussion primarily revolves around the **gold market** and its macroeconomic influences, particularly in the context of the **US-China trade conflict**, **monetary policies in Japan and Europe**, and **US government shutdowns**. Core Insights and Arguments 1. **Gold Price Surge**: Since 2025, gold prices have benefited from multiple factors, including the escalation of the US-China trade conflict, potential monetary easing in Japan, political instability in Europe, and the US government shutdown, leading to an investment return of approximately **50%** [1][4][5]. 2. **Global Fiscal Policies**: The global fiscal policy environment is characterized by a tendency towards easing rather than tightening, with post-pandemic fiscal expansion leading to increased inflationary pressures, thereby supporting commodity prices, including gold [1][6]. 3. **Supply Chain Restructuring**: The restructuring of global supply chains, triggered by the trade war, has resulted in significant changes in the financial system, causing the dollar index to weaken and gold to gain a premium as a safe-haven asset [1][9]. 4. **US Economic Demand Decline**: The US is experiencing a decline in economic demand, which is contributing to expectations of looser monetary policy and further driving up gold prices [1][10]. 5. **ETF Inflows and Private Purchases**: Increased inflows into ETFs and a rise in private sector purchases of gold bars have been significant drivers of gold price increases, reflecting market concerns over US monetary liquidity and trade uncertainties [2][12]. Additional Important Insights 1. **Market Divergence**: Recent market performance has shown a clear divergence, with gold prices rising sharply while risk assets like US stocks, Hong Kong stocks, and A-shares have declined [3]. 2. **Political Instability in Europe**: Political instability in France and the potential for renewed monetary easing in Japan have heightened market risk aversion, further supporting gold prices [1][7]. 3. **US Government Shutdown Impact**: The US government shutdown highlights the fiscal disagreements between political parties, increasing market uncertainty and bolstering safe-haven assets like gold [1][8]. 4. **Long-term Risks**: While short-term factors such as trade conflicts and fiscal easing support gold prices, there are potential risks in 2026 if US demand stabilizes, which could negatively impact gold [1][11]. 5. **Technological Development**: The future trajectory of the US economy, particularly in terms of technological advancements, will be a key determinant of economic cycles and, consequently, gold prices [1][11]. This summary encapsulates the critical points discussed in the conference call, focusing on the dynamics affecting the gold market and the broader economic implications.

Group 1 - Global risk assets experienced a broad decline, with significant drops in both US and Chinese indices, particularly in technology stocks [2][5][6] - The decline in asset prices is attributed to overseas risk events, including the potential impact of the US government shutdown and renewed trade tensions between the US and China [2][5][6] - The VIX index, a measure of market volatility, has increased but remains below extreme levels, indicating that the market is not in a state of panic [6][10][12] Group 2 - Since April, asset prices have gradually recovered from a period of excessive pessimism, aided by positive developments such as fiscal expansion in the US and capital expenditures from tech giants [3][7][12] - The report highlights two potential paths for the US economy: one indicating a late-stage stagflation in the service sector and another showing early recovery in manufacturing [12][17] - The upcoming earnings season for US technology companies is crucial to observe whether expectations will align with reality [12][17] Group 3 - The report suggests that while there is no current panic in the market, the higher valuation levels compared to April indicate a lack of "greed" [17] - For Chinese assets, the previous gains were largely driven by alignment with overseas technology trends, which may pose vulnerabilities in the short term [17] - The report recommends focusing on domestic policies and sectors that may benefit from a recovery in domestic demand, such as food and beverage, aviation, and real estate [17]

Core Viewpoint - The potential dissolution of the ruling coalition between the Komeito Party and the Liberal Democratic Party (LDP) poses significant uncertainty for Japan's political and legislative agenda, particularly affecting the newly appointed Prime Minister Sanna Takashi's ability to push through budget proposals and legislation [1] Group 1: Political Developments - Komeito Party leader Tetsuo Saito expressed intentions to "break away from the ruling coalition framework," indicating a significant shift in Japan's political landscape [1] - The failure to reach an agreement on party funding rules during discussions between Saito and Takashi raises concerns about Komeito's support in the upcoming prime ministerial election [1] - Analysts suggest that despite losing Komeito's backing, Takashi is likely to become the next Prime Minister due to the LDP's majority in both houses of the Japanese parliament [1] Group 2: Market Reactions - The breakdown of the coalition has led to increased volatility in the Japanese yen and a decline in the Nikkei 225 index futures, with market participants anticipating further fluctuations in the yen, Japanese government bonds, and the stock market amid political uncertainty [1] - Wells Fargo's Chidu Narayanan noted that the political turmoil could pressure Japanese assets, with the potential for larger fiscal expansions negatively impacting government bonds and the yen [2] - Market analysts predict that the Nikkei 225 index may retreat to around 45,000 points due to the combination of political instability and external factors such as the ongoing U.S. government shutdown [2] Group 3: Economic Implications - The political instability is expected to weaken Takashi's economic policy influence, potentially leading to policy concessions from the LDP [3] - Analysts from various firms express a cautious outlook on the Japanese stock market, indicating that while long-term prospects remain positive, short-term corrections may occur until the leadership situation stabilizes [3]