Core Investment Trends - Morgan Stanley identifies three core investment themes for the stock market over the next 12 months: AI computing power leaders and software giants benefiting from the AI wave, semiconductor equipment themes benefiting from favorable policies under the Trump administration, and essential consumer goods leaders amid a fragmented consumption chain [1][2]. AI Computing Power and Software Giants - The demand for AI computing power is experiencing explosive growth, driven by significant investments in AI infrastructure by the U.S. government and tech giants, indicating a bullish outlook for companies like Nvidia, TSMC, and Broadcom [6][10]. - Analysts predict that major tech companies, including Google, Microsoft, Meta, and Amazon, will spend over $350 billion on AI computing infrastructure in 2023, representing a nearly 50% year-over-year growth [6][10]. - By 2025, AI-related capital expenditures in tech companies are expected to reach 28%, up from 12% in 2023, with AI applications driving significant increases in efficiency and productivity [7][11]. Semiconductor Equipment Beneficiaries - The "One Big Beautiful Bill Act" (OBBBA) is expected to significantly boost free cash flow for U.S. manufacturing companies, particularly in the semiconductor equipment sector, as companies shift production back to the U.S. [13][14]. - Semiconductor equipment leaders are positioned to benefit from the unprecedented demand for AI chips, with companies like ASML and Applied Materials playing crucial roles in the manufacturing process [15][16]. Essential Consumer Goods Amid Consumption Fragmentation - The market is witnessing a divergence in performance, with essential consumer goods companies expected to show resilient growth while discretionary spending is under pressure [17][18]. - High-income consumers are less affected by inflation and continue to spend on non-essential items, while low-income consumers are shifting towards cheaper alternatives, leading to a stark contrast in consumption patterns [18].

Group 1 - The core viewpoint is that the U.S. federal budget deficit is projected to be nearly $1 trillion higher over the next decade than previously estimated by the Congressional Budget Office (CBO) due to tax and spending legislation and tariff policies [1] - The cumulative deficit from FY 2026 to FY 2035 is expected to reach $22.7 trillion, compared to the CBO's earlier estimate of $21.8 trillion [1] - The CBO will not release a mid-year budget update this year, instead opting to publish the next 10-year budget and economic outlook in early 2026 [1] Group 2 - The CRFB estimates that the "Big and Beautiful" legislation will increase the deficit by $4.6 trillion over the next decade, but this will be largely offset by $3.4 trillion in new tariff revenue from Trump's current tariff policies [2] - New regulations limiting Medicare subsidy eligibility are expected to reduce the deficit by an additional $100 billion by 2035, along with a potential $100 billion savings from the cancellation of funding for foreign aid and public broadcasting [2] - Net interest payments on U.S. debt are projected to total $14 trillion over the next decade, rising from nearly $1 trillion in 2025 (3.2% of GDP) to $1.8 trillion by 2035 (4.1% of GDP) [2] Group 3 - In a more pessimistic scenario, if the Court of International Trade upholds Trump's new tariffs, the expected tariff revenue could decrease by $2.4 trillion over the next decade [2] - The extension of temporary tax cuts in the "Big and Beautiful" legislation could increase the deficit by $1.7 trillion over ten years [3] - The CRFB warns that the debt-to-GDP ratio by 2035 could rise to 120% in the baseline scenario and 134% in a negative scenario, compared to the CBO's earlier estimate of 118% [3]

Core Viewpoint - The extension of the tariff ceasefire between the US and China for 90 days until November 10 is a strategic move to allow for potential high-level discussions during the APEC summit, reflecting the delicate balance of negotiations and economic pressures [1][4]. Group 1: Tariff Ceasefire and Economic Context - The US Treasury Secretary had previously communicated the intention to extend the tariff pause, but the signing by Trump was delayed, indicating political sensitivities around appearing to compromise with China [4]. - Recent employment data shows a significant drop in non-farm jobs, with only 73,000 added last month, far below expectations, and a revised total loss of 258,000 jobs over previous months, highlighting economic strain [4][6]. - The unemployment rate has risen to 4.3%, the highest in three years, with job losses in manufacturing and retail sectors, suggesting a deteriorating economic environment that pressures the administration to avoid further tariff escalations [4][6]. Group 2: Political Dynamics and Future Negotiations - Trump's reluctance to take responsibility for economic issues is evident as he shifts blame for poor employment statistics, indicating a desire to maintain political capital while managing economic fallout [6]. - The potential for a framework agreement during the APEC summit could lead to an extension or partial cancellation of tariffs, but failure to reach an agreement may result in increased geopolitical tensions and pressure on China [10]. - Analysts suggest that Trump may be inclined to make concessions during negotiations to maintain a favorable public image, despite the underlying reality of the US conceding to China [10].

Group 1 - The total federal government debt in the United States has surpassed $37 trillion, occurring several years earlier than expected [1] - Each American citizen is effectively responsible for approximately $108,000 of this debt, with the debt increasing at a rate of $3.5 million per minute, $212.9 million per hour, and $5.1 billion per day [3] - The "Big and Beautiful" plan proposed by Trump is projected to increase the fiscal deficit by about $4.1 trillion over the next decade, contributing to the growing debt [3] Group 2 - The Trump administration is under pressure to manage this massive debt, as failure to do so could undermine international confidence in U.S. Treasury securities and jeopardize the dollar's status as the world's primary reserve currency [5] - Trump has called for the Federal Reserve to lower interest rates to alleviate the burden of interest payments on the debt, indicating potential changes in leadership at the Fed [6] - U.S. Treasury Secretary Yellen has suggested a controversial idea of leveraging income from U.S. companies operating in China to help pay down the debt, although this may face significant challenges [6] Group 3 - The U.S. government has reportedly installed tracking devices in exported goods, including chips, to monitor their destinations, specifically targeting China [8] - There are concerns regarding the security of U.S. chip exports to China, with allegations that certain products may contain backdoors, complicating trade relations [8]

Core Insights - The "Titanium Praise" list is a monthly selection of outstanding works from the Titanium Media APP, based on article popularity, quality, and editorial recommendations [1][8] Group 1: Retail Industry - The article titled "The Store Closure Wave Sweeps the U.S. Retail Industry, 15,000 Stores May Close in 2025" discusses how changing lifestyles and work habits are reshaping in-store experiences, emphasizing that adapting to these changes is crucial for maintaining market share [2][9] - The focus on profit as the primary goal for retail giants is highlighted, indicating a shift in priorities within the industry [2][9] Group 2: Hospitality Sector - The piece "New World Development Receives 88.2 Billion Rescue Funds, Will It Sell Its Hotel Business?" raises concerns about the potential sale of hotel assets by New World Development, the only loss-making member among the four major families in the industry [2][10] Group 3: Cultural Commentary - The article "Dong Yuhui Talks About 'Four Sentences of Hongqu', Sparking a Cultural Storm" explores the impact of cultural figures on public discourse, noting that cultural transmission is a complex process involving debate and reconstruction [2][19] Group 4: Financial Legislation - The "Big and Beautiful" bill is discussed in the context of its potential to reshape the U.S. economy, highlighting the complexities of government debt and the diverse interests involved [2][16][17] Group 5: Banking Sector - The analysis titled "After a Day of Shock, How to View the Current Bank Stock Market?" suggests that the A-share banking sector has undergone a valuation recovery and is entering a phase of increased volatility and divergence [2][18] Group 6: Semiconductor Industry - The article "Domestic Analog Chips, on the Eve of Rise" indicates that China's economic transformation is shifting from a "demographic dividend" to an "engineer dividend," with the analog chip sector being a key area for innovation [2][21] Group 7: Delivery Services - The piece "An 'Epic' Delivery Coupon War" describes a surge in orders leading to unprecedented pressure on the delivery industry, affecting all participants in the supply chain [2][22] Group 8: Cryptocurrency Market - The article "2025 Stablecoin Midfield Battle: Trump, Wall Street, National Team, Who's on the Table?" discusses the strategic implications of stablecoins in the cryptocurrency market, emphasizing their role as a bridge between dollars and cryptocurrencies [2][23]

Report Industry Investment Rating No relevant content provided. Core Viewpoints of the Report - China's official manufacturing PMI in July 2025 fell to 49.3, and the new orders index dropped to 49.4, while the non - manufacturing sector remained in expansion. The market demand for manufacturing has slowed down [1]. - In the long - term, A - shares have high investment value. Among them, CSI 500 and CSI 1000 are more supported by science and innovation policies and may bring higher returns, while SSE 50 and SSE 300 have more defensive value in the current macro - environment [2][9][10]. - Domestic glass and soda ash are in the process of inventory digestion. The market focus has returned to supply and demand, and the speed of upstream inventory digestion should be concerned in the future [3][15]. - Gold and silver may continue to fluctuate. The long - term drivers of gold still provide support, but the upward movement is hesitant due to high prices. Attention should be paid to the performance of the US non - farm payrolls [4][17]. Summary by Directory 1. Main News on the Day International News - The number of initial jobless claims in the US last week increased by 1,000 to 218,000, lower than the market expectation of 224,000. The number of continuing jobless claims in the previous week remained unchanged at 1.946 million [5]. Domestic News - In June 2025, China's exports of goods and services in the balance of payments were $329.2 billion, imports were $259.1 billion, and the surplus was $70.1 billion [6]. Industry News - In the first half of the year, the newly installed capacity of renewable energy in China was 268 million kilowatts, a year - on - year increase of 99.3%, accounting for about 91.5% of the newly installed capacity. The installed capacity of new energy storage reached 94.91 million kilowatts/222 million kilowatt - hours, an increase of about 29% compared with the end of 2024 [7]. 2. Daily Returns of Overseas Markets - The S&P 500 fell 0.37%, the European STOXX 50 dropped 1.11%, the FTSE China A50 futures declined 1.69%, the US dollar index rose 0.08%, ICE Brent crude oil fell 1.25%, London gold spot rose 0.45%, London silver dropped 1.16%, LME metals declined to varying degrees, and most agricultural products in CBOT showed small fluctuations [8]. 3. Morning Comments on Main Varieties Financial - **Stock Index**: The US three major indexes fell, and the stock index had a significant correction in the previous trading day. The banking sector with high interest and low volatility has performed well since 2025. In the long - term, A - shares have high investment value [2][9][10]. - **Treasury Bonds**: Treasury bonds continued to rise, and the yield of the 10 - year active treasury bond fell to 1.70%. In the short - term, when the equity and commodity markets are weak, the price of treasury bond futures may continue to stabilize [11]. Energy and Chemicals - **Crude Oil**: The sc night session fell 0.71%. Trump's tariff policies have added uncertainty to global oil demand. The US crude oil production in May reached a record high of 13.49 million barrels per day. Attention should be paid to OPEC's production increase [12]. - **Methanol**: The methanol night session fell 0.08%. The average operating load of domestic coal (methanol) to olefin plants decreased slightly, and the coastal methanol inventory increased. Methanol is expected to be slightly bullish in the short - term [13]. - **Polyolefins**: Polyolefin futures mainly declined. The market is mainly driven by supply and demand, and attention should be paid to the autumn stocking market after supply and demand digestion [14]. - **Glass and Soda Ash**: Glass and soda ash futures continued to correct. Both are in the process of inventory digestion, and attention should be paid to the speed of upstream inventory digestion [3][15]. - **Rubber**: The price of raw rubber is supported by supply - side factors, but the demand - side support is weak. The inventory in Qingdao is increasing, and the short - term trend is expected to continue to correct [16]. Metals - **Precious Metals**: Gold rebounded after a decline, and silver continued to correct. The Fed's internal views are divided, and the market is speculating on the possibility of a rate cut in September. Gold and silver may continue to fluctuate [4][17]. - **Copper**: The copper price at night session closed lower. The copper price may fluctuate within a range due to the combination of long and short factors. Attention should be paid to the progress of US tariffs and other factors [18]. - **Zinc**: The zinc price at night session closed higher. The zinc price may fluctuate widely in the short - term, and attention should be paid to the progress of US tariffs and other factors [19]. - **Lithium Carbonate**: Lithium carbonate rose significantly due to the mining qualification issue in Jiangxi. The inventory continued to increase, and the fundamentals are still under pressure. The short - term core contradiction lies in the warehouse receipt inventory [20][21]. Black Metals - **Iron Ore**: The demand for iron ore is supported, but the medium - term supply - demand imbalance pressure is large. The iron ore price is expected to be volatile and slightly bullish in the future [22]. - **Steel**: The decline of rebar is greater than that of hot - rolled coil. The supply - demand contradiction in the steel market is not significant for the time being, and the steel price is expected to be volatile and slightly bullish in the future [23]. - **Coking Coal and Coke**: After the Politburo meeting, the short - term market sentiment has declined. After the correction, it is expected to maintain a range - bound and slightly bullish trend [24]. Agricultural Products - **Soybean and Rapeseed Meal**: The soybean and rapeseed meal futures were weakly volatile at night. The good growth of US soybeans has put pressure on the price, but the import cost will support the domestic soybean meal price [25]. - **Oils and Fats**: The oils and fats futures closed slightly lower at night. The expected inventory build - up of Malaysian palm oil in July has dragged down the palm oil price, and the oils and fats are expected to be weakly volatile in the short - term [26][27]. Shipping Index - **Container Shipping to Europe**: The EC was weakly volatile, and the 10 - contract closed at 1425.1 points, down 4.66%. The market will continue to game the off - season freight rate, and attention should be paid to the degree and slope of the freight rate correction [28].

Group 1 - Elon Musk announced the formation of a new political party called "American Party" on July 5, but has not yet registered it nearly a month later [1][2] - Musk's lack of progress in registering the party contrasts with his typically decisive style, as seen during his tenure in the federal government [1] - The only formal political entity led by Musk is the "American Political Action Committee," which he funded to support Trump's campaign [1] Group 2 - The "American Party" aims to participate in the upcoming congressional midterm elections, seeking to secure seats in both the House and Senate [2] - Establishing a qualified political party in the U.S. involves a complex certification process, including holding party meetings and electing temporary officials [2] - Tesla's second-quarter earnings report indicated a decline in both revenue and net profit year-over-year, reflecting challenges for the company [2]

Group 1 - The consumer confidence index in the U.S. rose from a revised 95.2 in June to 97.2 in July, indicating a gradual stabilization since April's decline [1] - The "present situation index" decreased by 1.5 points to 131.5, reflecting increased concerns about the current job market, while the "expectations index" increased by 4.5 points to 74.4, although it remains below the 80 threshold that typically signals a recession [1] - Only 14.3% of consumers rated the current business conditions as "bad," a slight decrease from 15% in June, while those rating it as "good" fell from 20.5% to 20.1% [1] Group 2 - Consumer confidence improvements were primarily driven by individuals aged 35 and older, with all income levels showing positive trends except for households earning less than $15,000 [2] - Concerns about tariffs remain high among consumers, with inflation expectations slightly decreasing to 5.8% in July from 5.9% in June, despite increased mentions of "high prices" and "inflation" [2] - Confidence in the stock market has improved, with 47.9% of respondents expecting stock prices to rise in the next 12 months, up from 37.6% three months prior [2] Group 3 - Consumers expect interest rates on mortgages, auto loans, and credit cards to rise, with the expectation for credit card rates being the most pronounced [3] - The assessment of household financial conditions remains stable but shows signs of fatigue, with a decrease in the proportion of consumers expecting a recession in the next 12 months, although it remains above 2024 levels [3] - There has been a decline in the willingness to purchase cars and homes, while service consumption intentions have decreased for the second consecutive month, particularly in dining out and travel-related expenses [3]

Core Points - The "Big and Beautiful" bill is viewed by Trump as a significant legislative achievement, likening it to a declaration of independence from national decline, despite facing multiple risks and skepticism from authoritative institutions like the CBO [1][4] Tax Cuts and Fiscal Deficit Reduction - The core provision of the "Big and Beautiful" bill is the reduction of the corporate tax rate from 35% to 21%, along with one-time tax deductions for qualifying production assets [3] - The bill also increases tax deductions for individual taxpayers, raising the standard deduction for single filers from $14,600 to $16,000 and for married couples from $29,200 to $32,000 [3] - The bill plans to cut at least $1.5 trillion in federal spending over the next decade, primarily targeting social welfare programs, to offset the increased fiscal deficit from tax cuts [4] Economic Impact and Uncertainties - The bill is expected to stimulate economic growth, potentially increasing the actual GDP growth rate by 3 percentage points and creating over 7 million jobs [6] - However, the long-term economic stimulus effects of the tax cuts may be limited, as many tax benefits have expiration dates, and the benefits primarily favor high-income groups [6][7] - The bill's optimistic assumptions may overlook negative effects, such as potential inflation from increased import tariffs and reduced consumer spending due to cuts in social welfare [7] Fiscal Deficit and Debt Concerns - The White House believes that tax cuts and deregulation will stimulate economic growth, thereby expanding the tax base, but these predictions carry significant uncertainty [8] - The bill is projected to increase the national debt by at least $3.4 trillion over the next decade, with net interest payments on the federal debt expected to exceed $1 trillion by 2025 [9] - The U.S. government is caught in a cycle of expanding deficits and increasing debt issuance, which could undermine market confidence in U.S. debt repayment capabilities [9]

Group 1: Economic Growth and Tax Policy - The "Big and Beautiful" Act significantly reduces corporate tax rates from 35% to 21%, allowing for immediate tax deductions on qualified production property and extending other tax incentives for business investments [2] - The Act aims to stimulate economic growth by increasing the actual GDP growth rate by 3% and creating over 7 million jobs, particularly benefiting small businesses and innovation [3][4] - However, the sustainability of economic growth from tax cuts is questionable, with potential diminishing returns and strict time limits on personal income tax reductions [4] Group 2: Fiscal Deficit and Government Spending - The Act plans to cut at least $1.5 trillion in spending over the next decade, primarily targeting social welfare programs to offset the increased fiscal deficit caused by tax cuts [5][6] - The projected increase in government deficit due to tax cuts is estimated at $4.5 trillion over the next ten years, raising concerns about the government's ability to manage its debt [6][7] - The Act raises the debt ceiling by $5 trillion, leading to an accelerated expansion of U.S. debt, with projections indicating a debt-to-GDP ratio increase from 122% to over 125% [7][8] Group 3: Social Welfare and Income Distribution - The Act proposes significant cuts to social welfare programs, including nearly $1 trillion from Medicaid, which may disproportionately affect low-income individuals while favoring wealthier taxpayers [10][11] - The changes in tax policy are expected to exacerbate income inequality, with lower-income groups facing net losses while higher-income groups benefit from substantial tax reductions [11][12] - The cancellation of renewable energy tax credits may lead to increased energy costs, further straining low-income households already affected by welfare cuts [12]