Core Viewpoint - The article emphasizes the significant changes in the bond market, particularly the decline in government bond prices and the rise in yields, which may indicate a shift in market sentiment and expectations towards inflation rather than deflation [1][9][31]. Group 1: Bond Market Changes - Recently, government bonds have seen a widespread decline, with long-term bonds experiencing the most notable drops [1][2]. - The 30-year government bond futures dropped by 1.33%, marking the largest decline since March 17, and closed at a new low since March 24 [3][4]. - The yields on government bonds are rising, with the 30-year bond yield increasing by 6.10 basis points to 2.055%, returning above 2% for the first time in four months [10][11]. Group 2: Market Dynamics - The article discusses the inverse relationship between bond prices and yields, where falling prices lead to rising yields, indicating a decrease in demand for bonds [12][13]. - The current bond market's unpopularity suggests a shift in investor sentiment, moving away from bonds towards equities, which is often seen as a normal reaction during bullish stock market conditions [15][18]. Group 3: Economic Expectations - The article posits that the recent bond market weakness is not solely due to the typical stock-bond relationship but is indicative of a broader change in market fundamentals [19][26]. - The transition from a deflationary trading environment to an inflationary one is highlighted, with the market's expectations shifting towards higher economic growth and inflation [31][34]. - Recent CPI data shows a month-on-month increase of 0.4% and a year-on-year increase of 0.8%, indicating a rise in inflation expectations [36]. Group 4: External Influences - The article notes that external factors, such as increased foreign investment and supportive government policies, are contributing to the changing dynamics in the capital market [42][43]. - The anticipated interest rate cuts by the Federal Reserve are expected to alleviate liquidity issues and support the transition from deflation to inflation trading [46]. Group 5: Future Outlook - The article concludes that the worst phase for the market has likely passed, and a prolonged recovery period is expected, with trading dynamics favoring inflationary strategies [48][49]. - The current high interest in the stock market and the declining bond market may become a new norm, suggesting significant potential for further stock market gains [50].

Core Viewpoint - The article emphasizes the significant changes in the bond market, particularly the decline in government bond prices and the rise in yields, which are critical signals for the future direction of the capital market [1][2][9]. Group 1: Bond Market Changes - Recently, government bonds have seen a widespread decline, especially in medium to long-term bonds [1][2]. - The 30-year government bond futures experienced a notable drop of 1.33%, marking the largest decline since March 17, with closing prices hitting new lows since March 24 [3][4]. - The yields on government bonds are rising, with the 30-year bond yield increasing by 6.10 basis points to 2.055%, returning above 2% for the first time in four months [10][11]. Group 2: Market Dynamics - The decline in bond prices and the simultaneous rise in yields indicate a weakening demand for bonds, suggesting that the attractiveness of bonds is diminishing [12][13]. - The article discusses the traditional inverse relationship between the stock and bond markets, where a strong stock market typically correlates with a weak bond market [15][16]. - However, the article argues that the current weakness in the bond market is not solely due to this stock-bond dynamic, as both short-term and long-term bonds are experiencing price and yield changes [19][24]. Group 3: Economic Expectations - The shift from a deflationary trading environment to an inflationary one is highlighted as a key factor influencing the bond market's performance [31][32]. - Recent economic indicators, such as rising CPI and increasing commodity prices, suggest a warming inflation outlook [36][37]. - The article notes that external factors, including increased foreign investment and potential policy changes, are contributing to a positive shift in market expectations [42][43]. Group 4: Future Outlook - The article concludes that the worst phase for the capital market has likely passed, and a prolonged recovery period is anticipated, with trading dynamics shifting towards inflation-driven strategies [48][49]. - The current market conditions indicate that the bond market may continue to weaken while the stock market remains strong, suggesting a new normal for capital market behavior [50].