Investment Rating - The industry maintains a rating of "Outperform the Market" [7] Core Views - The report emphasizes that the fundamental goal is to reverse deflation, with July's PPI down 3.6% year-on-year, continuing a downward trend. The strong correlation between PPI and coal prices suggests that coal prices need to stabilize. The lowest point for coal prices in 2024 may represent a policy bottom, with expectations for more supply-side policies to be introduced. Given the unclear demand-side changes, coal prices are expected to fluctuate upward amidst volatility, with a focus on high-quality core stocks as primary targets [5][6]. Summary by Sections 1. Market Overview - The coal index rose by 3.65% this week, outperforming the Shanghai Composite Index by 2.41 percentage points. Year-to-date, the coal index has dropped by 7.08%, while the Shanghai Composite Index has increased by 4.32%, indicating a significant underperformance of the coal index compared to the broader market [15][22]. 2. Thermal Coal 2.1 Key Indicators - As of August 8, 2025, the Qinhuangdao 5500K thermal coal price was 682 CNY/ton, up 2.9% week-on-week, but down 19.4% year-on-year. The average daily output from 462 sample mines was 5.624 million tons, reflecting a week-on-week increase of 150,000 tons [3][27][33]. 2.2 Annual Contract Price - The annual contract price for Qinhuangdao thermal coal (Q5500) was 668 CNY/ton as of August 2025, showing a month-on-month increase of 0.3% but a year-on-year decrease of 4.4% [28]. 2.3 Spot Prices - Domestic prices for thermal coal showed mixed trends, with significant increases in Inner Mongolia and Shaanxi, while Shanxi saw a slight rise. The price for Inner Mongolia's high-quality coal reached 547.8 CNY/ton, up 5.6% week-on-week [33][40]. 2.4 Supply and Demand - The operating rate of coal mines in the Shanxi, Shaanxi, and Inner Mongolia regions was 80.1%, with a slight decrease from the previous week. The daily consumption of the six major power plants increased to 93.3 million tons, up 6.5% week-on-week [41][46]. 3. Coking Coal 3.1 Key Indicators - As of August 8, 2025, the price for coking coal at the Jing Tang Port was 1610 CNY/ton, down 4.2% week-on-week. The average daily output from 523 sample mines was 755,000 tons, reflecting a decrease of 2.79% from the previous week [80][81]. 3.2 Spot Prices - The price for coking coal in Henan rose significantly by 5.8% week-on-week to 1460 CNY/ton, while prices in Anhui also saw a notable increase [82][84].

Report Industry Investment Rating - Not provided in the content Core Views - Short - term macro expectations have adjustment pressure after being fulfilled, but the medium - and long - term policy guidance remains bullish [4] - The domestic economy will maintain a weak reality. Pay attention to the improvement opportunities of cyclical industries that reverse deflation [4] - Domestic and overseas liquidity is expected to be loose, and the domestic stock market will receive incremental funds, but there are also some unfavorable factors such as the increase in the pressure of equity financing and the marginal increase in the pressure of share unlocking [4] - After a short - term sharp rise, the valuations of various indices have entered the neutral to high level in history, and the attractiveness of allocation funds is average [4] - In August, it is recommended to reduce long positions or conduct short - term shorting of IC and IM during rebounds, and go long on IF and IH during sharp drops. Also, use out - of - the - money put options to protect against adjustment risks [4] Summary by Directory 1. Market Review - **Stock Market Performance**: In the past month, A - shares led the rise, and the Nasdaq led the decline. The growth rate rankings of various indices are as follows: ChiNext > CSI 500 > Dow Jones > FTSE Emerging Markets > Hang Seng Index > Nikkei 225 > FTSE Europe > Nasdaq Composite. In terms of industries, steel led the rise, and comprehensive finance led the decline [7][8][12] - **Futures Basis and Spread**: The basis rates of the four major stock index futures (IH, IF, IC, and IM) changed by 0.7%, 0.45%, 0.12%, and 0.35% respectively, and the discounts of each futures contract significantly narrowed. The inter - period spread rates of the four major stock index futures (current month and next month) and (next quarter and current month) also changed, with different trends for different contracts [20] 2. Fund Flow - **Margin Trading and Stabilization Funds**: In July, margin trading funds flowed in 134.35 billion yuan to reach 1.98 trillion yuan, and the proportion of margin trading balance in the market value of tradable shares in the Shanghai and Shenzhen stock markets increased by 0.07% to 2.33%. The scale of passive stock ETF funds exceeded 3 trillion yuan, an increase of 78.13 billion yuan from the previous month, but the share decreased by 11.65 billion shares [23] - **Industrial Capital**: In July, equity financing was 46.49 billion yuan, and the scale of equity financing significantly declined to a low level. The market value of share unlocking was 288.39 billion yuan, a month - on - month increase of 69.89 billion yuan, and the marginal increase continued [26] 3. Liquidity - **Money Supply**: In July, the central bank's OMO reverse repurchase had a net withdrawal of 36.43 billion yuan, and the MLF had a net injection of 10 billion yuan. The overall liquidity supply was neutral to loose [28] - **Money Demand**: In July, the net demand for money in the bond market was 208.386 billion yuan, maintaining a high level, driven by the debt financing needs of national bonds, local government bonds, and enterprises [31] - **Fund Price**: In July, DR007, R001, and SHIBOR overnight rates changed by - 49.1bp, - 73.1bp, and - 10.7bp respectively, and the issuance rates of inter - bank certificates of deposit also decreased. The overall fund price rebounded slightly at a low level [34] - **Term Structure**: In July, the yield term structure of bonds flattened slightly, and the credit spread between national bonds and policy - bank bonds widened at the long - end [38] - **Sino - US Interest Rate Spread**: In July, the Sino - US interest rate spread inverted degree narrowed, the offshore RMB depreciated by 0.5%, and the US dollar against the RMB oscillated at the central level of the nearly three - year range [41] 4. Macroeconomic Fundamentals - **Real Estate Demand**: As of July 31, the weekly transaction area of commercial housing in 30 large - and medium - sized cities seasonally rebounded but was at a relatively low level in the same period. The second - hand housing sales seasonally declined. The real estate market was generally weak, but rigid demand supported the lower limit [44] - **Service Industry Activities**: As of August 1, the subway passenger volume in 28 large - and medium - sized cities remained high, and the service industry economic activities were at a high level. The traffic congestion delay index in 100 cities decreased, and the service industry economic activities tended to grow naturally and stably [48] - **Manufacturing Tracking**: In July, the capacity utilization rates of the manufacturing industry were differentiated. The overall internal and external demand of the manufacturing industry was still under pressure [52] - **Goods Flow**: The goods flow and passenger flow remained at a relatively high level, but the growth in some fields cooled down weekly. The highway and railway transportation were relatively weak, and there was a seasonal decline after August [57] - **Import and Export**: The export rush after the Sino - US trade talks ended, and the export was expected to be under pressure from August to September [59] - **Overseas Situation**: In the US in July, the employment market was mixed, the ISM manufacturing PMI dropped to the lowest level in the year, and the market's expectation of the Fed's interest rate cut increased [62][66] 5. Other Analyses - **Valuation**: In the past month, the risk premium of the stock - bond market decreased, and the foreign capital risk premium index also decreased. The relative valuation levels of major indices were not low, and the attractiveness of small - cap stocks decreased significantly [69][74] - **Quantitative Diagnosis**: According to the seasonal law, the stock market is in a period of seasonal shock decline and structural differentiation from August to September. It is recommended to pay attention to the trading and arbitrage opportunities of different index futures [77]