Core Viewpoint - The recent decline in global risk assets, particularly in the U.S. stock market, reflects a combination of trade tensions, high valuations, and diverging fundamentals, indicating a shift in market dynamics compared to previous downturns [5][23]. Market Performance - The S&P 500 index fell by 2.71%, marking its largest single-day drop since May [2]. - The Nasdaq index experienced a more significant decline of 3.56%, losing 700 points, highlighting a sharp correction in technology stocks [3]. - The ChiNext index in China also dropped by 2%, with tech stocks that previously rose in tandem with U.S. tech shares being heavily sold off [4]. Structural Characteristics of the Decline - The downturn in the U.S. market exhibited structural characteristics, with major tech giants like Apple, Tesla, and Nvidia seeing declines of 3.45%, over 5.06%, and 4.89% respectively, which directly impacted index performance [7]. - The decline spanned the entire tech industry, indicating a broad market correction in growth expectations for the sector [8]. - The Russell 2000 index, which represents small-cap stocks, fell by 2.99%, suggesting rising concerns about financial stability [9]. Economic and Policy Context - The recent asset price fluctuations were triggered by two key policy moves from the Trump administration, including permanent layoffs affecting over 4,000 federal employees and a potential government shutdown impacting GDP growth [10]. - The U.S. economy's vulnerability is highlighted by a rising unemployment rate of 3.8% and a significant drop in non-farm payrolls [10]. - Trade tensions, particularly the renewed threat of tariffs on China, have exacerbated global supply chain uncertainties, leading to a downward revision of global economic growth forecasts by Goldman Sachs [10]. Market Sentiment and Expectations - Unlike the panic seen in April, the current market sentiment is characterized by a lack of extreme fear, as indicated by the VIX index peaking at 22.6 compared to 35.2 in April [11][19]. - Investors have developed a more mature expectation framework regarding trade conflicts, anticipating a cycle of threats, negotiations, and compromises [13]. - The upcoming APEC summit in November is seen as a potential catalyst for renewed U.S.-China trade discussions, providing psychological support to the market [14]. Valuation and Investment Strategy - Current market valuations are high, with the S&P 500's price-to-earnings ratio at 29.7, significantly above the April low of 24.3 [16]. - The absence of extreme panic and new policy stimuli suggests that blindly buying the dip may be risky, as the market is currently experiencing a process of valuation digestion and momentum shifting [19][24]. - Investors are advised to focus on identifying intrinsic value rather than following overseas liquidity trends, with a short-term focus on domestic consumption recovery and policy benefits [25]. Chinese Market Dynamics - The previous reliance of Chinese assets on overseas liquidity and tech stock correlations has revealed vulnerabilities, suggesting a potential for index-level adjustments, albeit manageable [20]. - Domestic policies and signs of recovery in consumer demand are seen as the most certain investment themes, with the "anti-involution" policy extending to high-end manufacturing [20]. - The recovery in social retail sales growth to 4.2% in September indicates a positive trend in domestic demand [20]. Mid-term Investment Focus - The recovery of global manufacturing and rising physical consumption trends are expected to remain central to asset allocation strategies [21]. - Non-bank financial sectors are anticipated to benefit from improving capital returns as manufacturing rebounds, with historical data suggesting significant excess returns following manufacturing PMI recoveries [21]. - Physical assets, particularly in industrial metals and raw materials, are positioned to benefit from demand recovery, with current valuations below historical medians [21].

Report Industry Investment Rating - Not provided in the report Core Viewpoints - Last week, copper prices remained volatile. The IMF lowered the global economic growth forecast from 3.3% to 2.8%, and the Fed may cut interest rates if the job market deteriorates. The US significantly reduced tariffs on China, but the two sides have not entered the formal negotiation stage, causing market concerns. Domestically, industrial enterprise profits turned positive, and the central bank conducted net MLF injections. The domestic economic cycle is accelerating. Fundamentally, the spot TC negative value dropped to -$40, the domestic trade spot premium was high, and the B structure of the futures market narrowed. Overall, copper prices are expected to remain volatile, pending further clarity on the Sino-US trade situation [2][3][8]. Summary by Directory 1. Market Data - **Price Changes**: From April 18th to April 25th, LME copper rose from $9,254/ton to $9,360/ton, a 1.15% increase; COMEX copper rose from 470.5 cents/pound to 490.05 cents/pound, a 4.16% increase; SHFE copper rose from 76,140 yuan/ton to 77,440 yuan/ton, a 1.71% increase; international copper rose from 67,750 yuan/ton to 68,990 yuan/ton, a 1.83% increase. The Shanghai-London ratio rose from 8.23 to 8.27 [4]. - **Inventory Changes**: As of April 25th, the total inventory of LME, COMEX, SHFE, and Shanghai bonded areas decreased to 563,461 tons, a 9.44% decrease from April 18th. Among them, LME copper inventory decreased by 9,950 tons, SHFE inventory decreased by 54,858 tons, and Shanghai bonded area inventory decreased by 2,800 tons, while COMEX inventory increased by 8,849 short tons [7]. 2. Market Analysis and Outlook - **Macro Factors**: The IMF lowered the 2025 global economic growth forecast from 3.3% to 2.8%. The US may adjust tariffs on Chinese goods, and the Fed may cut interest rates if the job market worsens. Domestically, in Q1, the profits of industrial enterprises above designated size increased by 0.8% year-on-year, and in March, they increased by 2.6% year-on-year [9]. - **Supply and Demand**: The spot weekly TC once widened to -$40. The global mine supply is expected to remain tight in the medium term. Domestic smelters maintain high operating rates, but imports decreased in March. In terms of demand, the bidding progress of power grid investment projects is slow, but the start-up rate of cable enterprises in March rebounded to 73.6%. The new energy industry has stable copper demand growth [10]. - **Inventory**: As of April 25th, the total global copper inventory decreased to 563,000 tons. LME copper inventory decreased by 10,000 tons, and the LME0 - 3 structure turned to C. The cancellation warrant ratio dropped to 37.9%. SHFE inventory decreased by 55,000 tons, and the bonded area inventory decreased by 2,800 tons. The COMEX copper inventory increased to 132,000 tons [8]. 3. Industry News - Peru's Antamina copper mine had a mining accident, and production is expected to be significantly affected. In February 2025, the global refined copper market had a surplus of 61,000 tons. In Q1, MMG's copper concentrate production reached 120,000 tons, and the production of its African mine increased. The processing fee of 8mm T1 cable wire rods in East China increased slightly, and the start-up of refined copper rod enterprises is expected to slowly recover in early May [12][13][14]. 4. Related Charts - The report provides multiple charts, including the price trends of SHFE copper and LME copper, inventory changes in various regions, copper spot premium trends, and the net long - position ratio of COMEX copper non - commercial traders, etc., to visually display the market situation [15][16][19]