Market Overview - Macro growth factors have stabilized, with the Jianxin Gaojin growth factor turning positive, indicating a recovery in macro growth expectations[4] - The ChiNext Index surged by 8.58%, leading global markets, driven by a renewed preference for technology growth sectors[9] - Market risk appetite has improved, with trading volume increasing by 24.1% week-on-week, reflecting heightened investor participation[57] Inflation and Economic Indicators - CPI year-on-year growth is at 0.1%, while PPI remains low, indicating persistent deflationary pressures[4] - The manufacturing PMI for July is at 49.3%, down 0.4 percentage points from the previous month, suggesting a slight contraction in manufacturing activity[39] Asset Class Recommendations - Fixed Income: Favor high-grade credit bonds and adjust duration flexibly, focusing on bank and insurance sector movements[5] - Equities: In the U.S., focus on technology sectors with long-term AI investment opportunities, as economic data shows resilience[5] - Commodities: Structural differentiation is evident, with strong performance in soybean meal (+5.59%) due to supply concerns[4] Risk Factors - Key risks include policy adjustments, market volatility, geopolitical shocks, and liquidity transmission risks[6] Valuation and Earnings Expectations - A-share valuations have increased, with the CSI 800's P/E ratio at the 13th percentile of the past three years, indicating rising valuation pressure[64] - Analysts project a 9.9% year-on-year earnings growth for the CSI 800, with revenue growth expectations at 6.0%[65]

Core Viewpoint - Deutsche Bank's strategist team believes that the U.S. economy is facing stagflation risks due to supply-side shocks, recommending short positions on 10-year U.S. Treasuries [1] Economic Impact of Tariffs and Immigration Policies - The bank expects core CPI inflation to rise by approximately 0.5 percentage points in the coming months due to tariff impacts, significantly above market consensus [2] - Tariff policies are likened to a combination of VAT increases and negative supply shocks, with tariffs impacting low-income households more than high-income groups, leading to a mild negative effect on overall demand [4] - Stricter immigration policies further exacerbate labor market supply shocks, potentially lowering the non-farm employment growth equilibrium to a range of 50,000 to 100,000 jobs [4] Labor Market Analysis - Despite recent weak employment data, Deutsche Bank believes initial expectations have not materially changed, with the latest non-farm employment growth slightly below the equilibrium range [5] - The bank notes that the unemployment claims data has not triggered the Sam Rule, and wage growth remains resilient, consistent with interpretations of negative supply shocks [5] Inflation Risks and Interest Rates - Deutsche Bank's analysis indicates significant upside risks to inflation, with core CPI month-on-month growth expected to be in the range of 0.3% to 0.4% [11] - The current market pricing of the terminal rate at around 3% is considered low compared to a neutral real rate close to 2%, suggesting that the market may be underpricing future inflation [11] Investment Strategy - Deutsche Bank recommends shorting 10-year U.S. Treasuries, with a target yield of 4.60% and a stop-loss at 4.05%, citing technical and seasonal factors supporting this strategy [12] - For investors looking to hedge spread risks, the bank suggests going long on 10-year SOFR with a target of 4.10% and a stop-loss at 3.55% [12]

Core Viewpoint - The article discusses the significant fluctuations in the ferroalloy futures market, particularly focusing on manganese silicon and silicon iron, during the first half of 2024, highlighting the driving factors behind these price movements and the subsequent market corrections. Group 1: Price Movements - Manganese silicon prices surged from a low of 6108 CNY/ton to a high of 9786 CNY/ton, marking a two-year peak due to supply disruptions caused by a cyclone affecting South32's operations [2] - Silicon iron prices increased from a minimum of 6402 CNY/ton to 8234 CNY/ton, with a significant daily limit increase at the end of May [3] Group 2: Driving Factors - Supply shock from South32's disruption led to panic in the market, prompting smelters to stockpile, which created a positive feedback loop of rising costs and prices [4] - The release of the "2024-2025 Energy Conservation and Carbon Reduction Action Plan" in late May triggered market speculation reminiscent of the 2021 "dual control of energy consumption" policy, further boosting market sentiment [6] Group 3: Market Characteristics - Trading volumes for manganese silicon and silicon iron futures reached record highs, with 3.16 million and 2.27 million contracts traded in a single day, respectively, indicating significant market activity [12] - The futures market exhibited a premium over the spot market, encouraging alloy producers to increase output, resulting in a 15% month-on-month rise in manganese silicon production from April to May [13] - Despite the price increases, the actual manganese ore supply gap was limited, with only a 10% shortfall in total imports, indicating that the price surge was driven more by market sentiment than by fundamental supply-demand dynamics [14] Group 4: Market Correction - In June, regulatory measures such as position limits and increased transaction fees were introduced to curb excessive speculation [16] - The supply of manganese ore improved with increased arrivals from South Africa and Gabon, leading to a rise in port inventories to 6.5 million tons, a 20% year-on-year increase [17] - Demand weakened as steel mills reduced production due to losses, causing manganese silicon prices to decline sharply from their late May highs back to around 5900 CNY/ton by September [19]

Group 1 - The primary concern of the current macroeconomic environment is the persistently low price levels [1] - The low price levels are attributed to structural issues on the demand side, such as the decline in real estate investment, and more significantly, complex supply-side shocks [1] - China is experiencing a "good" supply shock driven by technological advancements and economies of scale, leading to a nearly 90% increase in overall labor productivity over the past decade [1] Group 2 - The costs of new production modes, represented by new energy vehicles, lithium batteries, and solar cells, have significantly decreased [1] - This decrease in costs reflects the potential for new production models in the industry [1]

Group 1 - The core viewpoint of the article is that Trump's criticism of Federal Reserve Chairman Powell is a strategic move to shift blame for a potential economic recession away from his administration [1][2] - Summers interprets Trump's repeated calls for interest rate cuts as a way to create a narrative that allows him to attribute any economic downturn to external factors rather than his policies [2] - Despite Trump's aggressive rhetoric, Summers expresses optimism that Trump will appoint a mainstream candidate for the next Fed chair, prioritizing market stability over political impulses [2][3] Group 2 - Powell's term as Fed chair is set to expire in May 2026, and Trump has indicated that an announcement regarding the next chair will be made soon [3] - Potential candidates for the Fed chair position include current Treasury Secretary Scott Bessent and former Fed governor Kevin Warsh [3] - Summers highlights the negative supply shocks indicated in the Fed's latest economic forecast, attributing them to tariffs that are raising inflation expectations while simultaneously complicating the Fed's monetary policy [4]

Group 1 - Former U.S. Treasury Secretary Lawrence Summers expects President Donald Trump to nominate a mainstream candidate to replace Federal Reserve Chairman Jerome Powell, despite Trump's criticism of Powell for not lowering interest rates this year [1] - Summers expresses confidence that Trump will make a respected choice for the next Fed chair, influenced by the desire to avoid market instability and some voices among Senate Republicans [1] - Trump has reiterated calls for the Fed to lower interest rates by at least 2 percentage points, suggesting that his criticism may be more about deflecting blame for a potential economic recession rather than directly influencing Fed policy [2] Group 2 - Summers highlights the negative impact of supply shocks on the economy, as indicated by the Fed's latest economic forecasts, despite lower energy costs and potential productivity gains from AI [2] - The Fed's simultaneous upward revisions of inflation and unemployment rate forecasts are unusual, suggesting an impending supply shock due to tariffs, which complicates the Fed's efforts [2]

Core Viewpoint - The European Central Bank (ECB) Executive Board member Schnabel indicated that supply-side shocks may persist and could potentially destabilize inflation expectations, emphasizing the need for readiness to respond swiftly [1] Group 1 - Supply-side shocks are likely to continue affecting the economy [1] - There is a risk that these shocks could undermine inflation expectations [1] - The ECB must prepare for rapid responses to these challenges [1]