Investment Rating - Industry rating: Recommended [5] Core Views - The report highlights a recovery in domestic demand driven by policy support, particularly in the real estate sector, which is expected to stabilize [2][3] - The consumer goods sector, particularly home furnishings and cosmetics, is anticipated to benefit from increased consumption policies and a recovering real estate market [3][4] Summary by Relevant Sections Retail Data - In November 2025, the total retail sales growth was +1.3%, lower than the expected +2.9%. Cumulatively, from January to November 2025, retail sales increased by +4.0% year-on-year [1][13] - Specific categories showed varied performance: furniture sales decreased by -3.8%, while cultural office supplies and cosmetics grew by +11.7% and +6.1%, respectively [1][11] Real Estate Sector - The real estate market continues to face challenges, with new housing starts, completions, and sales all showing significant year-on-year declines in November 2025, at -26.8%, -28.0%, and -19.1%, respectively [2][32] - However, there are signs of improvement in the month-on-month data, indicating potential stabilization in the market [2] Home Furnishings - The home furnishings sector is expected to gain momentum due to ongoing policy support and a recovering real estate market, which will stimulate demand for home upgrades [3][9] Cosmetics - The cosmetics sector is experiencing a recovery, with retail sales for January to November 2025 reaching 428.5 billion yuan, a year-on-year increase of +4.8%. November sales alone were 46.8 billion yuan, up +6.1% year-on-year [4][24] Gold and Jewelry - The gold and jewelry sector saw retail sales of 341.4 billion yuan from January to November 2025, reflecting a +13.5% year-on-year increase. November sales were 29.2 billion yuan, up +8.5% year-on-year, driven by rising gold prices [8][28] Investment Recommendations - Recommended companies in the home furnishings sector include Oppein Home, Kuka Home, and others, which are expected to outperform due to their strong brand and market position [9] - In the cosmetics sector, domestic brands like Runben and others are highlighted for their growth potential through diversified product strategies [9]

Group 1: Consumer Price Index (CPI) Trends - In November, the Consumer Price Index (CPI) increased by 0.7% year-on-year, the highest since March 2024, with a month-on-month decline of 0.1% [4] - The core CPI, excluding food and energy, rose by 1.2% year-on-year, maintaining a growth rate above 1% for three consecutive months [6] - Food prices shifted from a decline of 2.9% to an increase of 0.2%, significantly impacting the CPI [5] Group 2: Producer Price Index (PPI) Trends - The Producer Price Index (PPI) increased by 0.1% month-on-month for two consecutive months, but year-on-year, it decreased by 2.2%, with the decline slightly widening [4][9] - Seasonal demand increases in certain industries, such as coal and gas, contributed to the month-on-month PPI rise [8] - The decline in PPI is attributed to high comparison bases from the previous year, but there are signs of positive changes in pricing due to macroeconomic policies [9] Group 3: Economic Outlook and Policy Measures - The International Monetary Fund (IMF) projects China's economic growth rate to reach 5% in 2025, an upward revision from previous forecasts [4] - The Chinese government is intensifying policies to boost domestic demand, with plans to optimize the supply structure of consumer goods by 2027 [12] - Various international organizations have recently raised their forecasts for China's economic growth, indicating a positive outlook [4] Group 4: Sector-Specific Insights - The increase in vegetable prices, which rose by 14.5% year-on-year, is a key driver for the CPI's positive shift [5] - The prices of industrial consumer goods, such as home appliances and clothing, have also seen significant increases, reflecting the impact of domestic demand policies [6] - New industries, including new materials and intelligent technologies, are driving price increases in related sectors, indicating a shift towards higher value-added production [9][10]

Core Insights - Chongqing has overtaken Shanghai to become China's "consumption champion" in the first half of the year, with a retail sales total of 830.04 billion yuan, a year-on-year increase of 4.5%, compared to Shanghai's 826.04 billion yuan and a 1.7% increase [1][6] - The competition between Chongqing and Shanghai reflects the vitality of China's consumer market, showcasing ongoing innovation in urban consumption [6] Group 1: Chongqing's Strategies - Chongqing's unique geographical features have been leveraged to create a diverse consumption space, including 286 "mountain city walkways + characteristic street areas + riverside economic belts," enhancing the overall shopping experience [3][4] - The city has implemented a series of policies to stimulate consumption, including subsidies for 3C digital products, resulting in 3.2682 million transactions and 1.701 billion yuan in subsidies by the end of June [3][4] Group 2: Economic Impact - The city has seen a significant increase in domestic tourism, with 235 million visitors in the first half of the year, a year-on-year growth of 8.6%, and domestic tourist spending reaching 250.7 billion yuan, up 11.9% [5] - Chongqing has hosted over 120 events for brand launches in the past three years, attracting 892 new brand stores, indicating strong market confidence in the city's consumption potential [5] Group 3: National Context - The consumption surge in Chongqing is part of a broader trend of recovering domestic demand, with national retail sales increasing by 5.0% year-on-year in the first half of the year, accelerating by 0.4 percentage points compared to the first quarter [5]

Core Insights - South Korean President Lee Jae-myung encourages citizens to dine out to support economic recovery and boost domestic demand [1] - Rising food prices and declining food safety perceptions are causing hesitation among consumers regarding dining out [1] Economic Context - The Korean Statistical Office reports that dining out expenses have increased by 3.1% compared to the previous year, with processed food prices rising by 4.6% [1] - Significant price hikes in specific food items include a 38.3% increase in gimbap and a 37% rise in hamburgers, with 77% of food categories experiencing price increases of over 20% [1] Industry Challenges - A report from the Korean Food Promotion Institute indicates that 73.6% of surveyed restaurants lack chefs with Korean cuisine certification, leading to consumer distrust in food hygiene and service consistency [1] - Factors contributing to rising restaurant costs include the depreciation of the Korean won, increasing raw material prices, and domestic political uncertainties since late 2024 [1]

Group 1 - The manufacturing sentiment in the consumer goods and equipment manufacturing sectors has significantly declined, indicating a need for increased policy support [1][8][11] - In April, the manufacturing PMI dropped to 49.0%, falling below the neutral line of 50%, with consumer goods and equipment manufacturing sectors both entering a downturn [8][11] - The automotive sector showed a decline in production despite strong sales, with the operating rate of semi-steel tires dropping by 3.81 percentage points compared to March [11][14] Group 2 - The coal supply and demand situation remains weak, with low prices leading to a reduction in domestic supply and continued price declines [17][19] - The real estate sector experienced a marginal decline in transaction volumes, particularly in second and third-tier cities, while first-tier cities showed resilience [30][31] - The financial sector saw a decrease in trading activity, with the A-share market declining by 3.2% in April, while social financing data exceeded expectations [40][41] Group 3 - The consumer sector displayed structural strengths, with service consumption performing well, but uncertainties in external demand are increasing [2][3] - The TMT sector faces challenges due to rising trade barriers, impacting the development of humanoid robots and artificial intelligence industries [2][3] - The new energy sector is experiencing stable demand for lithium batteries, while the photovoltaic sector is seeing a decline in demand [2][3]

Investment Rating - Industry rating: Recommended [4] Core Views - The report highlights a positive outlook on domestic demand recovery, driven by continuous policy support and improving real estate data [2][3] - The retail sector shows significant recovery, with March retail sales growing by 5.9% year-on-year, surpassing market expectations [1][6] - The report emphasizes the potential for the home furnishing sector to rebound, supported by government policies aimed at stimulating consumption [3][7] Summary by Relevant Sections Retail Sector - In the first three months of 2025, total retail sales increased by 4.6% year-on-year, with notable growth in furniture (+18.1%), cultural office supplies (+21.7%), cosmetics (+3.2%), and gold and silver jewelry (+6.9%) [1] - March retail sales alone saw a year-on-year increase of 5.9%, with furniture and cultural office supplies experiencing growth rates of 29.5% and 21.5%, respectively [1][6] Real Estate Sector - The report notes a decline in new housing starts, completions, sales, and residential development investment in the first quarter of 2025, with year-on-year decreases of 23.9%, 14.7%, 2.0%, and 9.0%, respectively [1][2] - March data shows a continued decline in new housing starts (-18.6%) and completions (-8.1%), but a slight improvement in sales (-1.2%) [1][2] Policy Impact - The government has released favorable signals for the real estate market, including measures to stabilize housing prices and enhance consumer confidence [2][3] - The "Consumption Promotion Special Action Plan" emphasizes support for upgrading consumer goods and encourages the replacement of old products, which is expected to stimulate demand in the home furnishing sector [3][7] Investment Recommendations - The report recommends leading companies in the home furnishing sector, such as Oppein Home, Kuka Home, and ZBOM, which are expected to capture market share from smaller competitors [7] - In the cultural office supplies sector, companies like Morning Glory are highlighted for their strong channel advantages and innovative product offerings [7] - The cosmetics sector is also noted for its growth potential, with domestic brands expected to gain market share through diverse product strategies [7]

Investment Rating - Industry rating: Recommended [4] Core Views - The report highlights a positive outlook on domestic demand recovery, driven by supportive policies and improving real estate data [2][3] - The retail sector shows significant recovery, with March retail sales growth at 5.9%, surpassing expectations [1][6] - The report emphasizes the potential for the home furnishing sector to rebound due to policy support and consumer demand [3][7] Summary by Sections Retail Data - In the first three months of 2025, total retail sales increased by 4.6% year-on-year, with March showing a 5.9% increase, exceeding the consensus forecast of 4.36% [1] - Specific categories such as furniture, cultural office supplies, cosmetics, and gold and silver jewelry saw growth rates of 18.1%, 21.7%, 3.2%, and 6.9% respectively [1] - Online retail sales growth was recorded at 7.9% in the first quarter, indicating a steady increase in online consumption [6] Real Estate Data - National residential new construction area, completion area, sales area, and development investment completed in the first three months of 2025 showed declines of 23.9%, 14.7%, 2.0%, and 9.0% respectively [1] - In March, the new construction area and completion area declined by 18.6% and 8.1% year-on-year, while the sales area decreased by 1.2% [1][2] Policy Impact - The government has released favorable signals to stabilize the real estate market, including measures to optimize housing provident fund policies [2][3] - The "Consumption Promotion Special Action Plan" emphasizes support for upgrading consumer goods, which is expected to stimulate demand in the home furnishing sector [3][7] Investment Recommendations - For the home furnishing sector, the report recommends companies like Oppein Home, Kuka Home, and others, anticipating steady growth driven by policy support and consumer demand [7] - In the cultural office supplies sector, it suggests Morning Glory Co., which is expected to benefit from collective procurement policies [7] - The cosmetics sector is highlighted for its potential growth, recommending domestic brands like Runben and Pechoin [7] - Gold and silver jewelry consumption is expected to remain strong, with recommendations for companies like Laopu Gold [7]