Group 1 - The State Council has issued measures to further promote private investment development, emphasizing the need for industry authorities and local governments to specify requirements for private capital participation in project construction [1] - The measures encourage private capital involvement in new urban infrastructure projects with profit potential, particularly in smaller cities [1] - There is an increased support for eligible private investment projects through central budget investments and new policy financial tools, with banks required to set annual service targets for private enterprises [1] Group 2 - The policy explicitly encourages private capital participation in profitable infrastructure projects such as railways, nuclear power, hydropower, oil and gas pipelines, and water supply, supporting a minimum holding ratio of over 10% [1] - The real estate sector is experiencing rising policy expectations, with forecasts indicating a stabilization of the real estate market by 2026, focusing on companies with balance sheet recovery [2] - Research from China International Capital Corporation suggests that there are opportunities for Hong Kong-funded real estate companies to experience a second upward trend [2]

Investment Rating - The investment rating for the real estate industry is "Outperform the Market" (maintained) [2][3] Core Viewpoints - The real estate sector continues to face pressure, with significant declines in investment and sales figures. The cumulative year-on-year decline in real estate development investment reached 13.9% for the first nine months of 2025, with new housing starts down 18.9% and completed housing down 15.3% [4][45] - The sales performance of new commercial housing has weakened, with a cumulative year-on-year decline of 7.9% in sales revenue and 5.5% in sales area for the same period. The sales figures for September 2025 indicate a year-on-year decline of 11.8% in sales revenue and 10.5% in sales area [6][45] - The report suggests that the high base effect from last year's fourth quarter will create significant pressure this year, leading to increased policy expectations that may provide opportunities for the real estate sector [5][72] Summary by Sections Investment and Sales Data - In the first nine months of 2025, national real estate development investment totaled 67,706 billion, down 13.9% year-on-year. New housing starts were 45,399 million square meters, down 18.9%, and completed housing was 31,129 million square meters, down 15.3% [4][45] - The sales area of new commercial housing was 65,835 million square meters, with a year-on-year decline of 5.5%, and sales revenue was 63,040 billion, down 7.9% [4][6] Price Trends - The average selling price of new commercial housing was 9,575 yuan per square meter, down 2.5% year-on-year, with a slight improvement in the rate of decline compared to previous months. In September, the average price was 9,406 yuan per square meter, down 1.4% year-on-year [22][45] Development Investment and Funding - Real estate development investment accelerated its decline, with a year-on-year drop of 13.9% for the first nine months. Funding for real estate enterprises was 72,299 billion, down 8.4% year-on-year [45][58] - In September, the year-on-year decline in development investment was 21.3%, while funding saw a decline of 11.5% [45][58] Construction Data - The new housing starts for the first nine months were 45,399 million square meters, down 18.9%, while completed housing was 31,129 million square meters, down 15.3%. However, September saw a year-on-year improvement in completed housing [58][45]

Report Industry Investment Rating No relevant content provided. Core Views - The US has extended the tariff exemption period for various countries until August 1st. The impact of US tariff policies on the market remains uncertain, and there is a risk of emotional shocks similar to the situation in 2018. The domestic economy is entering a seasonal recovery window, and there are strong expectations for macro - policies before the Politburo meeting at the end of July [4]. - The real - estate sales are seasonally declining at a low level, and the service industry is experiencing structural differentiation and a decline due to high summer temperatures. The manufacturing's rush - to - export phase is ending, and there may be a decline in the third quarter. The PPI deteriorated significantly in June, and domestic anti - involution policies are expected to reverse the commodity supply - demand balance and lead to a recovery in prices [4]. - Domestic liquidity is generally neutral, with marginal tightening. Overseas liquidity is also tightening marginally. The US dollar index is expected to rebound from an oversold position. The domestic stock market will receive south - flowing return funds, but there is an outflow from passive ETF shares. IPO and other equity financing are increasing, and margin trading funds are continuously flowing in, while the pressure of share unlocks is decreasing marginally [4]. - After a short - term rebound, the valuations of various indices are still at a relatively high level in the historical range. The stock - bond risk premium at home and abroad has further declined, and the attractiveness of allocation funds is average [4]. - In the next 1 - 2 weeks, the broad - based index market is expected to oscillate, reach a peak, and then decline. It is recommended to reduce long positions in stock index futures after a sharp rise this week. In terms of style, hold long positions in IC and IM, and short IF and IH on rallies, or conduct an arbitrage strategy of long IM and short IF [4]. Summary by Directory 1. Market Review - **Global Stock Market Performance**: A - shares led the rise last week, while US stocks led the decline. The ranking of index increases is: ChiNext Index > German stock market > Shenzhen Component Index > FTSE Europe > Hang Seng Index > FTSE Emerging Markets > Nikkei 225 > NASDAQ Index. Specific increases include: the Shanghai Composite Index rose 1.09%, the Shenzhen Component Index rose 1.78%, and the ChiNext Index rose 2.36% [8][9]. - **Industry Performance**: The comprehensive finance industry led the rise, while the automobile industry led the decline [12]. - **Futures Basis and Spread**: The basis rates of the four major stock index futures (IH, IF, IC, and IM) changed by 0.56%, 0.46%, 0.56%, and 0.67% respectively last week, with the discounts of IF and IH narrowing significantly. The inter - period spread rates (between the current month and the next month) of the four major stock index futures changed by 0.08%, 0.12%, 0.08%, and 0.22% respectively, with the inter - period discounts of IF and IM narrowing slightly. The inter - period spread rates (between the next quarter and the current month) of the four major stock index futures changed by 0.1%, 0.17%, 0.15%, and 0.33% respectively, with the long - term discounts of the four major index futures converging significantly, especially for IM [21]. 2. Fund Flows - **Margin Trading and Market - Stabilizing Funds**: Margin trading funds flowed in 20.78 billion yuan last week, reaching 1.87 trillion yuan. The proportion of margin trading balance to the circulating market value of the Shanghai and Shenzhen stock markets decreased by 0.01% to 2.25%. The scale of passive stock ETF funds was 3065.57 billion yuan, an increase of 39.88 billion yuan from the previous week, and the share was 1988.43 billion shares, with a redemption of 1.09 billion shares from the previous week [24]. - **Industrial Capital**: In the first two weeks of July, equity financing was 19.42 billion yuan, with 3 companies. Among them, IPO financing was 3.98 billion yuan, private placement was 15.44 billion yuan, and convertible bond financing was 8.45 billion yuan. The scale of equity financing increased marginally. The market value of stock unlocks last week was 39.21 billion yuan, a decrease of 51.58 billion yuan from the previous week [28]. 3. Liquidity - **Monetary Injection**: Last week, the central bank's OMO reverse repurchase expired 652.2 billion yuan, and the reverse repurchase injection was 425.7 billion yuan, resulting in a net monetary withdrawal of 226.5 billion yuan. The MLF had a net injection in June, with a total of 300 billion yuan injected and 182 billion yuan expired. The overall liquidity supply is neutral, with marginal tightening [30]. - **Monetary Demand**: The net monetary demand from national debt, local debt, and other bonds was 193.14 billion yuan, 152.2 billion yuan, and 405.57 billion yuan respectively last week. The total net monetary demand from the bond market was 750.91 billion yuan. The debt financing demand in the bond market remained high [33]. - **Fund Price**: The DR007, R001, and SHIBOR overnight rates changed by 4.9bp, 4.3bp, and 2bp respectively to 1.47%, 1.4%, and 1.33%. The issuance rate of inter - bank certificates of deposit decreased by 4.1bp, and the CD rate of joint - stock banks rebounded by 3.6bp to 1.63%. The overall fund price rebounded slightly [36]. - **Term Structure**: Last week, the yields of 10 - year, 5 - year, and 2 - year treasury bonds changed by 2.2bp, 3.5bp, and 4.2bp respectively; the yields of 10 - year, 5 - year, and 2 - year policy - bank bonds changed by 3.2bp, 4.7bp, and 3.7bp respectively. The yield term structure continued to flatten, and the credit spread between treasury bonds and policy - bank bonds widened at the long - end [40]. - **Sino - US Interest Rate Spread**: As of July 11th, the US 10 - year treasury bond yield changed by 8.0bp to 4.43%, the inflation expectation changed by 4.0bp to 2.37%, and the real interest rate changed by 4.0bp to 2.06%. The inversion of the Sino - US interest rate spread widened by 5.76bp to - 276.54bp, and the offshore RMB depreciated slightly by 0.12% [43]. 4. Macroeconomic Fundamentals - **Real - Estate Demand**: As of July 10th, the weekly transaction area of commercial housing in 30 large - and medium - sized cities was 1.549 million square meters, a significant seasonal decline from 3.329 million square meters in the previous week. The second - hand housing sales also declined seasonally, reaching the lowest level in nearly seven years. The real - estate market sales are generally at a low level, and the financial market expects the introduction of urban renewal policies [45]. - **Service Industry Activities**: As of July 11th, the average daily subway passenger volume in 28 large - and medium - sized cities was 83.91 million, a 0.5% decrease from the same period last year but a 25.2% increase from 2021. The congestion delay index in 100 cities decreased slightly from the previous week. The service industry economic activities are approaching a natural growth and stable level [48]. - **Manufacturing Tracking**: Last week, the capacity utilization rates of the manufacturing industry showed a mixed trend. The capacity utilization rate of steel mills changed by - 0.39%, that of asphalt changed by 1%, that of cement clinker enterprises changed by 0.73%, and that of coke enterprises changed by - 0.3%. The average operating rate of the chemical industry chain related to external demand decreased significantly by 0.67% from the previous week [52]. - **Goods Flow**: The goods and passenger flows are at a relatively high level, with strong growth in the postal express and civil aviation sectors. However, the highway and railway transportation are relatively weak, and there is a risk of a seasonal decline in July - August [57]. - **Import and Export**: The logic of the rush - to - export after the Sino - US trade talks is coming to an end, and the port cargo throughput and container throughput have declined significantly. There is a risk of a second decline after the end of the 90 - day tariff exemption period in July - August [60]. - **Overseas**: The Fed's monetary policy meeting minutes are still hawkish. Most officials support a rate cut in September due to concerns about the impact of tariffs. The market expects the Fed to cut rates twice in 2025, with a rate cut of about 25 - 50bp, and the rate cut times are expected to be in September and December [62]. 5. Other Analyses - **Valuation**: The stock - bond risk premium was 3.27%, a decrease of 0.08% from the previous week, and was at the 65.4% quantile. The foreign capital risk premium index was 4.07%, a decrease of 0.17% from the previous week, and was at the 22.4% quantile. The valuations of the Shanghai 50, CSI 300, CSI 500, and CSI 1000 indices are at the 81.1%, 73.9%, 82.9%, and 65.7% quantiles respectively in the past five years, and the attractiveness of the valuations decreased marginally [64][69]. - **Quantitative Diagnosis**: According to seasonal patterns, the stock market is in a period of seasonal oscillation and growth with structural differentiation in July. The growth style is relatively dominant, and the cyclical style first rises and then falls. There is a risk of the market reaching a peak and adjusting in the middle and late July. It is recommended to pay attention to the opportunities of going long on IC and IM on dips and shorting IF and IH on rallies [72]. - **Financial Calendar**: This week, China will release data on June's currency and real economy. Overseas markets should pay attention to the US June CPI, PPI, retail sales, and the Fed's economic situation beige book, which will affect the market's expectations for the Fed's interest rate path [75].

Macroeconomic Overview - The market showed a significant increase last week, with an average trading volume of 1,496.2 billion CNY, up by 54.7 billion CNY from the previous week[9] - The Shanghai Composite Index rose by 1.09%, while the Shenzhen Component Index increased by 1.78%[9] - CPI for June was slightly better than expected at 0.1% YoY, compared to a previous value of -0.1%[10] - PPI for June was significantly below expectations at -3.6% YoY, worsening from -3.3% in May[10] Market Sentiment and Policy Impact - The extension of the tariff suspension by the U.S. until August 1 reduced short-term uncertainties, boosting market sentiment in the Asia-Pacific region[9] - Expectations for the upcoming Politburo meeting in July are low, focusing mainly on structural policies, but there is an uplift in real estate policy expectations[9] - The automotive manufacturing sector showed signs of recovery, with PPI for this sector increasing by 0.2% MoM, indicating positive effects from previous anti-involution measures[13] Investment and Economic Data - Fixed asset investment growth is expected to be 3.74% YoY for June, slightly up from the previous value of 3.70%[16] - Social retail sales for June are anticipated to grow by 5.52% YoY, down from a previous value of 6.40%[16] - The second quarter GDP growth is projected at 5.17% YoY, compared to a previous value of 5.40%[16]

1. Report Industry Investment Rating No information provided in the given content. 2. Core View of the Report - Last week, steel and ore prices moved sideways with minor fluctuations. The traditional consumption off - season has arrived, leading to a decline in the apparent demand for steel and an increase in iron ore port inventories. The pessimistic expectation for future demand has been the core trading logic this year. However, external factors such as the Middle - East situation driving up crude oil prices and the expectation of new domestic real - estate policies are starting to impact this logic. Currently, these factors have not had a substantial impact on reality, and attention should be paid to changes in trading volume. It is recommended to focus on intraday short - term trading for now and conduct trend trading after policy confirmation [67]. 3. Summary by Relevant Catalogs 3.1 Raw Material Market Condition Analysis - **Price and Profit**: PB powder price dropped from 729 yuan/wet ton to 720 yuan/wet ton, and its spot landing profit increased from - 5.29 yuan/wet ton to - 2.55 yuan/wet ton. Barite coarse powder price decreased from 702 yuan/wet ton to 693 yuan/wet ton, and barite mixed powder spot landing profit decreased from 6.42 yuan/wet ton to 5.87 yuan/wet ton [6]. - **Shipping Volume**: Australia's shipping volume to China increased by 336.5 tons to 1815.8 tons, while Brazil's shipping volume to China decreased by 188 tons to 745.8 tons [6]. - **Inventory and Transportation**: Imported iron ore port inventory increased by 102.83 tons to 14503.14 tons, the arrival volume increased by 76.5 tons to 2673.9 tons, and the port clearance volume decreased by 13.81 tons to 315.25 tons. Iron ore port trading volume increased by 11.1 tons to 85.4 tons [6]. - **Steel Production**: The average daily molten iron output decreased slightly from 241.8 tons to 241.61 tons, and the steel enterprise profitability rate decreased from 58.87% to 58.44% [6]. 3.2 Market Status Analysis - **Price**: Shanghai rebar price dropped from 3120 yuan/ton to 3080 yuan/ton, and Shanghai hot - rolled coil price decreased from 3200 yuan/ton to 3180 yuan/ton [35]. - **Operating Rate**: The blast furnace operating rate decreased from 83.56% to 83.41%, and the electric furnace operating rate decreased from 76.69% to 74.01% [35]. - **Profit**: Rebar blast furnace profit increased from 99 yuan/ton to 135 yuan/ton, hot - rolled coil blast furnace profit increased from 33 yuan/ton to 60 yuan/ton, and rebar electric furnace profit increased slightly from - 125 yuan/ton to - 124 yuan/ton [35]. - **Production and Inventory**: Rebar weekly production decreased by 10.89 tons to 207.57 tons, and its social inventory decreased by 10.43 tons to 375.19 tons, and enterprise inventory decreased by 1.97 tons to 182.89 tons. Hot - rolled coil weekly production decreased by 4.1 tons to 324.65 tons, its social inventory increased by 4.59 tons to 268.88 tons, and enterprise inventory increased slightly by 0.18 tons to 76.53 tons [35][37]. - **Apparent Consumption and Trading Volume**: Rebar weekly apparent consumption decreased by 9.06 tons to 219.97 tons, hot - rolled coil weekly apparent consumption decreased by 1.04 tons to 319.88 tons, and building material trading volume decreased by 2483 tons to 101832 tons [37]. 3.3 Supply - Demand Data Analysis - **Operating Rate**: The report presents historical data on blast furnace and electric furnace operating rates [44]. - **Production**: It shows historical data on the weekly actual production of rebar and hot - rolled coil in Chinese steel enterprises [49][51]. - **Profit**: Historical data on the average profit of electric - furnace building steel in China is provided [56]. - **Inventory**: Historical data on the social and enterprise inventories of rebar and hot - rolled coil in China are presented [57][59]. - **Trading Volume**: Historical data on the trading volume of building steel by mainstream traders in China is shown [60]. - **Apparent Consumption**: Historical data on the weekly apparent consumption of rebar and hot - rolled coil are provided, as well as data on steel exports in China [61][62]. - **Real - Estate and Manufacturing**: Data on real - estate investment, sales, new construction, and construction area growth rates in China, as well as the manufacturing PMI, are presented [63][65].