Group 1: Market Performance - In June, the bond market saw a downward trend in yields, while the equity market performed exceptionally well, leading to impressive returns for "fixed income +" funds, with the highest yield exceeding 7% [1][2] - The average yield for "fixed income +" funds in June reached 1.03%, significantly outperforming traditional bond funds, which had yields of 0.29% for medium to long-term bonds and 0.10% for traditional money market funds [2][6] - The Shanghai Composite Index rose by 2.9% in June, closing at 3444 points, while the Shenzhen Component Index and the ChiNext Index saw increases of 4.23% and 8.02%, respectively [2][3] Group 2: Fund Performance - Several "fixed income +" funds recorded outstanding monthly returns, with five funds achieving yields over 5% and two exceeding 7% [2][6] - The top-performing fund, Jin Ying Yuan Feng A, achieved a net value return of 7.52%, leading the category [2][6] Group 3: Market Dynamics - The total transaction volume in June reached 26.72 trillion yuan, with a daily average of 1.3 trillion yuan, reflecting a year-on-year growth of 79.57% [3] - New account openings in June increased by 53% year-on-year, indicating a significant recovery in retail investor sentiment [3] Group 4: Bond Market Outlook - Analysts suggest that favorable factors for the bond market are developing, with expectations of incremental monetary policy support potentially benefiting long-term government bonds and various credit bonds [4][5] - The funding environment in July is typically characterized by lower rates, which may lead to increased liquidity and support for the bond market [4][5] - Institutional behavior, particularly from the insurance sector, may provide additional support for the bond market if the predetermined interest rates remain below 2.25% [4][5]

Report Industry Investment Rating - The rating for Treasury bonds is "Oscillation" [5] Core Viewpoints of the Report - The economic fundamentals will gradually face pressure, and the fundamental situation is favorable for the bond market. It is advisable to maintain the strategy of buying on dips. In the medium to long term, the probability of making profits by going long on long - term bonds is high, but the potential return is relatively limited. Therefore, the strategy of buying on dips is more cost - effective [3][35] - The economic data in Q2 may decline moderately, and the pressure on economic decline will become more apparent in Q3. It is expected that China will introduce incremental policies to address this situation at that time [2][11] Summary by Relevant Catalogs 1. Increase in Internal and External Pressures, Most Economic Data Falling Short of Expectations - **Q1 Economic Data Strength Logic**: The strong performance of Q1 economic data was mainly due to two reasons: the beginning of the year is the peak demand season for sectors such as real estate, and policy efforts further stimulated market demand; enterprises had a strong motivation to rush exports, and the export industry chain showed resilience. However, both logics had issues of poor sustainability [1][9][10] - **April Economic Data Weakening**: In April, most economic data weakened compared to the previous period. The year - on - year growth rate of industrial added value in April was 6.5%, with an expected value of 6.1% and a previous value of 7.7%; the year - on - year growth rate of social retail sales in April was 5.1%, with an expected value of 5.5% and a previous value of 5.9%; the cumulative year - on - year growth rate of fixed - asset investment from January to April was 4%, with an expected value of 4.2% and a previous value of 4.2%. After the data was released, Treasury bond futures fluctuated and rose [9] - **Future Economic Trend**: The economic data in Q2 may decline moderately, and the pressure on economic decline will become more obvious starting from mid - year. Fiscal policy is the key to hedging against the weakening external demand. It is expected that China will introduce incremental policies in Q3, and policies will become the focus of market speculation at that time [2][11] 2. Production End: Both Industrial and Service Production Show Weakening Resilience - **Industrial Production**: In April, the year - on - year growth rate of industrial added value was 6.5%, with an expected value of 6.1% and a previous value of 7.7%. The growth rate of industrial production is weakening. The decline in the growth rate of export delivery value and the weakening of terminal demand such as external demand have dragged down production performance. Policy support has prevented a significant decline in the year - on - year growth rate of industrial added value. Looking forward, the weakening of external demand will have a more obvious impact on industries with high export dependence, but policies such as "two new" will support the production end, and the decline in the year - on - year growth rate of industrial added value is expected to be limited [12][13] - **Service Production**: In April, the service production growth rate was 6.0%, with a previous value of 6.3%. Weak service consumption and unstable economic recovery expectations have negatively affected service production. In the future, the production growth rate is expected to decline slightly. Although terminal demand is weak, policies to boost service consumption are expected to prevent a significant decline in the service production growth rate [13] 3. Demand End: Both Manufacturing and Infrastructure Growth Rates Decline Slightly, and Real Estate Data Deteriorates Marginally Again - **Manufacturing Investment**: From January to April, the cumulative manufacturing investment growth rate was 8.8%, with a previous value of 9.1%; in April, the monthly manufacturing investment growth rate was 8.2%, with a previous value of 9.2%. The decline in manufacturing investment growth rate is due to weak terminal demand and low corporate investment and financing willingness. However, policies such as equipment renewal have limited the decline. In the future, manufacturing will continue to grow at a high speed, but there will be obvious structural differentiation [18][19] - **Infrastructure Investment**: From January to April, the cumulative growth rate of broad - based infrastructure was 10.85%, with a previous value of 11.5%; the narrow - based infrastructure growth rate was 5.8%, with a previous value of 5.8%. In April, the monthly broad - based infrastructure growth rate was 9.57%, with a previous value of 12.58%. Infrastructure growth is gradually declining from a high level. The slow issuance of new special bonds and the decline in investment growth rates of some central - led infrastructure industries have led to the weakening of infrastructure growth in April. In the short term, infrastructure growth may face a slight downward pressure, but it is expected to rise again with subsequent policy support [22][23] - **Real Estate Market**: Most real estate indicators showed a decline again. Weak consumer willingness to buy houses and tight corporate funding sources have led to a decline in real estate investment. In the short term, the probability of directly introducing strong policies to stimulate real estate demand is low. The core idea of stabilizing the real estate market is to increase effective supply to stimulate effective demand. In the short term, real estate data may continue to weaken, and the impact of incremental fiscal policies on the real estate market in Q3 can be observed [26][27] - **Social Retail Sales**: In April, the social retail sales growth rate was 5.1%, with an expected value of 5.5% and a previous value of 5.9%. The decline in automobile and other large - scale consumer goods sales has dragged down the social retail sales growth rate. Different types of consumer goods show differentiated performance. In the future, social retail sales still face pressure due to high macro - environmental uncertainty and low probability of direct policies to improve residents' cash flow statements [30][31] 4. Fundamental Factors Favor the Bond Market, Maintain the Strategy of Buying on Dips - **Bond Market Outlook**: Due to the poor sustainability of the previous logics driving economic data improvement, future economic fundamental pressure will gradually emerge, which is favorable for the bond market. In the medium to long term, the probability of making profits by going long on long - term bonds is high, but the potential return is relatively limited. Therefore, the strategy of buying on dips is more cost - effective [3][35] - **Monetary Policy and Yield Curve**: The future fundamental pressure will gradually emerge, and the pressure of exchange - rate depreciation is relatively controllable. The probability of overall loose monetary policy is high. It is expected that the central level of capital interest rates will decline slightly, and the capital market will be in a state of balanced and slightly loose. The current yield curve is relatively flat and is expected to gradually steepen in the future [35][36] - **Investment Strategies**: In the medium term, there is still a bullish outlook. It is recommended to pay attention to the strategy of deploying medium - term long positions on dips. The opportunities for futures positive arbitrage have significantly decreased, and only some contracts still have slight positive arbitrage opportunities. Opportunities to steepen the curve have initially emerged, and subsequent changes in capital interest rates need to be closely monitored [38]