Core Viewpoint - Allianz Investment emphasizes that Asian markets, particularly the Chinese stock market, are key diversification choices for investors who are currently overexposed to US equities [1][4]. Group 1: US Federal Reserve and Interest Rates - Allianz's Chief Investment Officer for Fixed Income, Zeng Zheng, predicts further interest rate cuts by the US Federal Reserve, with a terminal rate of around 3.5% by mid-2026 [2]. - Zeng notes that the likelihood of the Fed choosing to cut rates is greater than maintaining the current rates, although the exact timing remains uncertain [2]. - Fixed income is highlighted as a core tool for capital preservation amid macroeconomic volatility, with a shift in return drivers expected from credit spreads to interest rate spreads by 2026 [2][3]. Group 2: Investment Opportunities in Asia - Zeng Yonghui, Chief Investment Officer for Asia Pacific equities, points out that many investors are overly concentrated in US stocks, particularly in large tech sectors, and are now reallocating to Asian assets [4]. - The current low allocation of global investors to Asian stocks presents a significant opportunity, especially as Asian stocks have a low correlation with US stocks [4]. - Four key themes driving investment opportunities in Asian stocks include innovation in technology, corporate reforms in major Asian economies, supply chain diversification, and emerging consumer trends [5]. Group 3: China's Economic Strategy - Allianz's Senior Economist, Tang Jicheng, identifies two main focuses of China's economic strategy: continued investment in advanced manufacturing and boosting domestic consumption [7]. - The "14th Five-Year Plan" outlines five strategic areas for attention, including modern industrial systems, technological breakthroughs, a unified domestic market, human-centered urbanization, and international cooperation [8]. Group 4: Multi-Asset Investment Strategies - Allianz's Head of Growth Multi-Asset, Hartwig Kos, notes that risk assets remain attractive, with a shift towards more diversified global allocations beyond US equities [10]. - The traditional "60/40" stock-bond portfolio remains viable, but flexibility and inclusion of non-core risk exposures like emerging market bonds and gold are essential for resilience [10]. - Gold is reaffirmed as a strategic asset, increasingly driven by geopolitical uncertainties and de-dollarization, making it a crucial component of a diversified investment portfolio [10]. Group 5: Sustainable Investment Trends - Allianz's Head of Sustainable and Impact Investing, Matt Christensen, indicates that sustainable investment regulation is entering a new phase, with a shift from mere disclosure to clearer product classifications in the EU [11]. - Impact investing is maturing, with growing recognition of achieving market-level returns, particularly in private markets, supported by clearer standards for outcomes and reporting [12].

中国基金报记者 郭玟君 11月17日， 安联投资 在香港举行2026年市场展望媒体会。安联投资固定收益首席投资总监曾铮预计，美联储将进一步降息，到2026年 年中，美国终端利率将在3.5%左右。安联投资亚太区股票首席投资总监薛永辉表示，当前多数投资者过度重仓美股， 亚洲市场（尤其是中 国股市）是关键的多元化配置选择 。 安联投资是全球最大的资产管理公司之一，截至6月30日，安联投资全球管理资产达5620亿欧元，约合4.63万亿元 人民币 。 【导读】安联投资：亚洲市场（尤其是中国股市）是关键的多元化配置选择 美联储将进一步降息 曾铮 表示："近期美国的政策信号，包括有选择性地取消部分关税，表明在不久的将来我们可能会看到相对稳定的通胀数据。但就业数据可 能走弱。" 曾铮称，从概率角度来看，美联储选择降息的可能性大于 " 按兵不动 " 。但降息的具体时间是在 2025年 12月还是2026年1月，仍难确 定。安联投资的内部观点是， 到2026年年中，美国终端利率将在3.5%左右， 高于当前市场共识。 曾铮认为，固定收益仍然是资本保值的核心工具，尤其是在宏观波动加剧和政策分化的情况下。投资者应通过审慎的久期管理，专 ...

1. Report Industry Investment Rating - Not provided in the document 2. Core View of the Report - In the short - term, concerns about liquidity due to the US government shutdown and negative feedback from high copper prices have caused copper prices to fall from their highs. However, in the long - term, the tight supply of copper mines is difficult to ease, and emerging consumption such as energy storage and AI has become a growth point. It is still recommended to adopt a strategy of buying on dips. Long - term non - US supply is generally tight, and after the inventory declines later, inter - period positive spreads (buying near - term and selling far - term) can be considered. After the import ratio rebounds, there are also opportunities for inter - market positive spreads [7][9][10] 3. Summary by Relevant Catalogs 3.1 Comprehensive Analysis and Trading Strategy - **Macro - aspect**: The record - high shutdown of the US government has increased short - term liquidity concerns in the market, and the uncertainty of a December interest rate cut has led to a rebound in the US dollar index, putting pressure on copper prices. But in the long - run, the expectation of US monetary easing remains unchanged, and the short - term liquidity problem will be resolved after the government reopens [7] - **Copper Mine**: In September, China imported 258.7 million tons of copper ore and concentrates, and the cumulative import volume from January to September was 2,263.4 million tons, a year - on - year increase of 7.7%. Supply - side disturbances in copper mines have increased, with the production of Grasberg, QB Phase II, etc. falling short of expectations. On November 7, the SMM imported copper concentrate index (weekly) was - 42.04 US dollars per ton, an increase of 0.11 US dollars per ton from the previous period [7][30] - **Scrap Copper**: As of Friday, the refined - scrap copper price difference was 2,988 yuan per ton. The operating rate of recycled copper rod enterprises this week was 27.57%, up 4.77 percentage points from last week and 2.65 percentage points year - on - year. Due to the uncertainty of the tax refund policy, most recycled copper rod enterprises in Jiangxi have stopped production, resulting in a strong demand for taxed scrap copper raw materials, and most of the taxed scrap copper raw materials in Ningbo and Guangdong are transported to Jiangxi. From January to September 2025, the domestic supply of scrap copper increased by 4.18%. In September, China imported 21.23 million tons of scrap copper, and the cumulative import volume from January to September was 169.89 million tons, a year - on - year increase of 1.53% [38][42] - **Refined Copper**: In October, SMM's electrolytic copper production in China decreased by 2.94 million tons month - on - month, a month - on - month decrease of 2.62% and a year - on - year increase of 9.63%. The cumulative increase was 11.96%. SMM expects that in November, electrolytic copper production will decrease by 0.4 million tons month - on - month, a decrease of 0.37% and a year - on - year increase of 8.21%. The cumulative year - on - year increase is 11.62%. In December, after the concentrated maintenance in October and November, production may increase slightly, but some smelters have a low willingness to increase production due to high copper prices [5][48] - **Consumption**: Domestically, demand has weakened marginally. The real estate market continues to drag down the market, and the production schedules of photovoltaic and air - conditioning industries have declined significantly. The main support for the market in the later stage comes from orders from the two power grids, the automotive industry, and energy - storage batteries. Downstream buyers have a low acceptance of high prices, but there is an increase in purchases around 85,000 yuan per ton [6] - **Inventory**: As of November 6, the copper inventory in the mainstream regions of China increased by 0.32 million tons to 20.33 million tons compared with Monday, and increased by 2.07 million tons compared with last Thursday, showing a continuous 5 - week weekly inventory accumulation. The bonded - area inventory decreased by 0.03 million tons to 8.82 million tons. As of November 7, the LME inventory decreased to 13.5 million tons, but it is expected to increase later. The COMEX inventory has increased to over 35 million tons, and the COMEX - LME price difference is maintained at 3% - 4% [10][14][17] - **Price Difference and Ratio**: The COMEX - LME price difference is maintained at 3% - 4%, and a large amount of copper from South America is still being shipped to the US. It is recommended to consider inter - period positive spreads (buying near - term and selling far - term) after the inventory declines later. After the previous export window opened, the LME inventory is expected to increase periodically, and the import ratio may rebound slightly. After the ratio rebounds, there are opportunities for inter - market positive spreads [10] 3.2 Copper Price Trends in 2025 - Throughout the year, copper prices have been affected by multiple factors such as US trade policies, production plan adjustments of major mines, and supply - side disturbances. For example, in March, the US imposed a 25% tariff on copper, which drove up copper prices; in April, due to the US imposing reciprocal tariffs globally, copper prices plummeted panic - stricken; in September, Grasberg adjusted its production plan [12][13] 3.3 Copper Market Data - **Copper Concentrate Market**: In August 2025, the global copper concentrate production decreased. In Peru, the copper production from January to August was about 1.81 million tons, a year - on - year increase of 2.6%. In August, the copper production was 419.8 tons, a month - on - month decrease of 4.94% and a year - on - year decrease of 10.05%. In Chile, due to a collapse accident in a new mining area of the world's largest underground copper mine in July, the state - owned copper company Codelco lowered its annual copper production forecast [31][32][36] - **Scrap Copper Market**: As of Friday, the refined - scrap copper price difference was 2,988 yuan per ton. The operating rate of recycled copper rod enterprises this week was 27.57%, up 4.77 percentage points from last week and 2.65 percentage points year - on - year. Due to the uncertainty of the tax refund policy, most recycled copper rod enterprises in Jiangxi have stopped production, resulting in a strong demand for taxed scrap copper raw materials, and most of the taxed scrap copper raw materials in Ningbo and Guangdong are transported to Jiangxi [38] - **Crude Copper Market**: In July 2025, the crude copper production was 1.0585 million tons, a year - on - year increase of 20.6%. From January to July, the cumulative production was 6.9996 million tons, a year - on - year increase of 12.76%. In September, China imported 50,100 tons of anode copper, a year - on - year decrease of 32.84%. From January to September, the cumulative import of anode copper was 578,700 tons, a cumulative year - on - year decrease of 15.58% [44][46] - **Domestic Copper Supply**: In October, SMM's electrolytic copper production in China decreased by 2.94 million tons month - on - month, a month - on - month decrease of 2.62% and a year - on - year increase of 9.63%. The cumulative increase was 11.96%. SMM expects that in November, electrolytic copper production will decrease by 0.4 million tons month - on - month, a decrease of 0.37% and a year - on - year increase of 8.21%. The cumulative year - on - year increase is 11.62%. From January to September, China imported 2.5416 million tons of refined copper, a cumulative year - on - year decrease of 4.06%; the export of refined copper was 489,500 tons, a year - on - year increase of 28.15% [48][52] - **Downstream Operating Rates**: In October, the operating rates of refined - copper rod, copper tube, enameled wire, and copper cable enterprises all decreased month - on - month, but are expected to increase slightly in November. The operating rate of copper foil enterprises increased in October and is expected to continue to rise in November. The operating rate of SMM's copper plate and strip enterprises decreased slightly in October and is expected to increase slightly in November [58] - **Consumption Areas** - **Air - Conditioning Consumption**: In September 2025, China's domestic air - conditioning production was 10.567 million units, a year - on - year decrease of 13.5%; sales were 10.884 million units, a year - on - year decrease of 10.2%. In November, the production schedule of domestic air - conditioners was 12.76 million units, a year - on - year decrease of 23.7% [62] - **Automobile Consumption**: In September, automobile production and sales were 3.276 million and 3.226 million units respectively, a month - on - month increase of 16.4% and 12.9% and a year - on - year increase of 17.1% and 14.9%. From January to September, automobile production and sales were 24.333 million and 24.363 million units respectively, a year - on - year increase of 13.3% and 12.9%. From January to September, the production and sales of new - energy vehicles were 11.243 million and 11.228 million units respectively, a year - on - year increase of 35.2% and 34.9% [66] - **Power Grid Investment**: From January to September 2025, China's power grid investment reached 437.8 billion yuan, a year - on - year increase of 9.9%, but the growth rate dropped significantly compared with that from January to August [69] - **Real Estate Market**: From January to September 2025, the sales area of newly - built commercial housing in China was 658 million square meters, a year - on - year decrease of 5.5%; the housing completion area was 311 million square meters, a year - on - year decrease of 15.3% [70][74] - **Overseas Data**: In the US, the sales of newly - built houses and the number of newly - started private residential buildings, as well as automobile sales, and in Europe, the registration volume of passenger cars all show certain trends and changes [76][77] - **Photovoltaic and Wind Power**: From January to September 2025, China's new photovoltaic installed capacity was 240.27GW, a year - on - year increase of 79.39GW or 49.34%. From January to September, the new wind - power installed capacity was 61.09GW, a year - on - year increase of 21.97GW or 56.16% [80] - **Global New - Energy Vehicle Sales**: In August 2025, the global new - energy vehicle sales were 1.7134 million units, a year - on - year increase of 16.97%. From January to September, the new - energy vehicle sales in the US were 1.2903 million units, a year - on - year increase of 10.01% [87] 3.4 Industry News and Macro Data - In October, SMM's electrolytic copper production in China decreased month - on - month. The CSPT group did not set a TC guidance price for the fourth quarter in its third - quarter meeting. Indonesia granted Amman Mining a 400,000 - ton copper - concentrate export quota. The US and euro - zone manufacturing PMIs showed different trends. Anglo Asian Mining signed a sales contract for copper concentrates. Glencore plans to shut down a smelter in Canada. Codelco lowered its annual copper production forecast. The US government shutdown has affected market liquidity. The US employment market has shown signs of stabilization. The US included copper in its new critical - mineral list. The Fed's December interest - rate cut direction is unclear. Tanzania reopened its border with Zambia [88]

Core Insights - Nanhua Fund's actively managed equity funds ranked 20th among 152 comparable fund managers in absolute return over the three years ending September 30, 2025, indicating strong performance in the industry [1] - The company emphasizes a clear investment style and strategy to cater to various risk preferences, aiming for wealth enhancement through well-researched products [1][3] Investment Strategies - Nanhua Fenghui focuses on investing in stocks of companies with sound governance, stable operations, excellent performance, and sustainable growth potential, employing a diversified and flexible investment strategy [1] - Nanhua Fengchun, managed by Xu Chao, targets high-end manufacturing sectors such as humanoid robots and solid-state batteries, aiming for steady asset appreciation through a forward-looking and research-driven approach [2] - Nanhua Ruiying demonstrates strong flexible allocation capabilities, with a stock asset ratio of 60%-95%, focusing on emerging consumption and AI applications to capture multi-layered investment opportunities [2] Research and Management - Under the leadership of experienced fund managers, Nanhua Fund aims to balance value and growth in its product line, translating research capabilities into tangible results [3] - The company maintains a long-term investment philosophy, prioritizing the interests of its investors while managing risks and capturing opportunities in a complex market environment [3]

Summary of Conference Call Notes Industry Overview - The gaming industry has shown strong revenue performance in the first half of the year, with companies like Kaiying and ST Huatong demonstrating rapid growth and strong overseas market performance, indicating stability and long-term growth potential in the gaming sector [1][2] - The Chinese internet sector, particularly in AR applications, has significant growth prospects, with Tencent leveraging its gaming business to support new ventures, and AI applications emerging as a new growth point [1][3] Key Companies and Performance - Chinese gaming companies such as G-bits and Giant Network are outperforming international peers like Take-Two and Roblox, with expectations for continued profit growth in 2026, particularly for ST Huatong, which may exceed 9 billion in profit [2][5] - Tencent's innovations in AI applications, including features in Tencent Meeting and content generation through Sora two, are expected to enhance user experience and increase commercial value, potentially leading to a revaluation of IP assets [1][6] Emerging Trends - The integration of AR technology in various sectors, including tourism and entertainment, is creating new market opportunities, with companies like Meitu performing well in the European market [4][7] - The new consumption trend, particularly in experiential consumption, is gaining traction, with products related to emotional value and IP, such as sports merchandise, becoming increasingly popular [9] Investment Outlook - Optimism is expressed for companies like Huimeng, Meitu, and Yuedu in the upcoming quarters due to their significant advancements in AR applications, with expectations for strong performance in the media sector unaffected by trade tensions [1][7] - The gaming and Chinese internet sectors are viewed as having lower risk and higher potential returns, with recommendations for investors to focus on gaming ETFs and Chinese internet ETFs [9][10] Conclusion - The overall sentiment is positive regarding the gaming and Chinese internet sectors, with a strong emphasis on the potential of AI and AR applications to drive future growth and investment opportunities [1][3][10]

Report Summary 1. Report Industry Investment Rating - No information provided 2. Core View of the Report - The external environment remains complex. The US tariff pressure on China persists, and the "rush to export" trend is unsustainable. However, the weakening of the US dollar's credit foundation eases the passive depreciation pressure on the RMB. In China, the conversion of expectations into reality is evident, but the continuous effect of the "anti - involution" policy on deflation improvement still depends on demand - side cooperation. Corporate profit repair is not yet stable, and the transmission of policies and monetary effects requires time. The current valuation repair process is ahead of the profit recovery slope, and the profit recovery situation is the key to whether the overall market center can rise. Attention should be paid to the recovery of the overall market profitability [5] 3. Summary by Relevant Catalogs 3.1 Market Performance - In September, the domestic A - share market indices continued to rise, with multiple indices hitting new highs this year. Small - cap growth stocks outperformed, followed by large - cap growth stocks, while large - cap value stocks had continuous corrections. The performance of various industries was significantly differentiated, with non - ferrous metals related to precious metals leading the gains, and coal, food and beverage, and oil and petrochemicals leading the losses. In terms of valuation, there was obvious internal differentiation among stock indices [3] - The basis of the four major stock index futures main contracts mostly remained in a discount state. The trading of the four major stock index futures was highly active, with a convergence at the end of the quarter. IM was the most active, followed by IF and IC with similar activity levels. The overall positions of the four major stock index futures varieties increased, with IM having the largest position scale, followed by IF [3] 3.2 Macroeconomic Situation - Domestically, in the first half of 2025, the GDP actually grew by 5.3%. The economic growth rate slowed down slightly in the second quarter, with a single - quarter growth of 5.2%. In 2024, the cumulative year - on - year growth rates of fixed - asset investment and real estate development investment were 3.2% and - 10.6% respectively. In the fourth quarter of 2024, the contributions of consumption, investment, and net exports to GDP all increased. After negotiations, the tariff rate was stable at 15%, and external demand maintained resilience [4] - Overseas, at the end of September, the Federal Reserve cut interest rates by 25bp as expected, and the dot - plot showed a total reduction of about 75bp this year. Due to the large - scale US fiscal deficit caused by the "Big and Beautiful" Act, the US Treasury yield remained high, and the US dollar index fluctuated around the key level of 97. The Fed Chairman paid more attention to the cooling of the US labor market, and the unemployment rate rose in the third quarter. The Fed's strict attitude towards inflation may ease [4]

Report Industry Investment Rating No relevant content provided. Core Viewpoints of the Report - In Q3 2025, the A-share market broke through the shock pattern and continued to rise. The external environment remains complex in Q4. The US tariff pressure on China persists, and the "rush to export" trend is unsustainable, putting pressure on the current account. However, the weakening of the US dollar eases the pressure on the RMB's passive depreciation, and the capital account is expected to continue to recover. Domestically, the conversion of expectations into reality is evident, but the continuous effect of the "anti-involution" policy on deflation still requires demand-side support, and the recovery of corporate profits is not yet stable. Policy and monetary effects will take time to be transmitted to the PPI, which is expected to turn positive in mid-2026, bringing about a resonance of profit and valuation in the stock index market. The index's range-bound pattern may continue, and the previous long IF and short IM hedging portfolio is recommended to be held. Allocation investors need to control their stock index positions, and long-term investors should focus on the progress of profit repair and policy effects [3][4]. Summary by Relevant Catalogs 1. Stock Indexes Break Through the Shock Pattern - **Market Review**: In Q1, the A-share market continued the shock pattern since Q4 2024. After being affected by Trump's "reciprocal tariff" remarks in April, the market recovered with the implementation of domestic policies and the easing of Sino-US trade frictions. In Q3, multiple positive factors supported the market, including the "anti-involution" policy, the continuation of the "rush to export" trend, the appreciation of the RMB, and the narrowing of the Sino-US interest rate spread, providing sufficient liquidity for the stock index market [9]. - **Industry Performance**: In the first three quarters of 2025, industries showed significant differentiation. Precious metals and related non-ferrous metals led the gains due to Trump's tariff policy, the Middle East situation, and the Fed's interest rate cut expectations. As of September 26, communication, non-ferrous metals, and electronics had the highest increases, while coal, food and beverage, and petroleum and petrochemicals had the largest declines [11]. - **Stock Index Basis**: The expansion of neutral strategies and the increase in the index dividend rate led to a larger discount in stock index futures. The injection of rescue funds and the active trading sentiment increased the trading volume of the A-share market, and the small and medium-cap style was dominant. The expansion of neutral strategies increased the hedging demand for stock index futures, and the high dividend rate of listed companies also contributed to the larger discount [13][17]. 2. Market Valuation: Focus on Earnings-Driven Valuation Digestion - **CSI 500 and CSI 1000 Indexes**: The valuation levels of the CSI 500 and CSI 1000 indexes have been significantly repaired. As of September 26, their price-to-book ratios were at historically low levels in the past 10 years [22]. - **SSE 50 and CSI 300 Indexes**: There is a divergence in the valuations of the SSE 50 and CSI 300 indexes. Their price-to-earnings ratios are generally in the high historical range, while the price-to-book ratios are relatively low. This difference is due to the significant valuation recovery since September last year, but the improvement in market profitability still takes time [22]. - **Index Crowding**: There is a potential for short-term style rebalancing. The crowding degree of the CSI 500 and CSI 1000 indexes has narrowed, and the market's enthusiasm for the CSI 500 index remains high. The relative valuation of the CSI 1000 index has further recovered. The crowding degree difference between the CSI 1000 and CSI 300 indexes has reached a high level in the past two years, increasing the potential for mean reversion [26][29][32]. - **Stock-Bond Cost-Effectiveness**: The stock market does not have an obvious relative advantage. After the continuous rise since September last year, the stock market is at a low level in terms of the stock-bond cost-effectiveness indicator. Although the domestic interest rate cut window is opening, the relative valuation of the stock market compared to the bond market is still at a relatively high level [35]. - **Valuation Summary**: After the continuous repair of the A-share market valuation this year, the relative valuation advantage of the stock index market over bonds has weakened, and the current stock-bond cost-effectiveness is still at a low level. There is a differentiation pattern within the market, and the valuation repair is faster than the profit recovery. Attention should be paid to the subsequent profit repair to drive the convergence of indicators. The CSI 1000 index may experience a style rebalancing [37]. 3. The Effect of Transforming Domestic Expectations into Reality is Evident - **Improvement in Financial Transmission Efficiency and the Need for Further Policy Release**: In August 2025, the "gap" between M2 and M1 growth rates narrowed, indicating an improvement in the capital activity and efficiency of enterprises. However, the structure of social financing shows that the endogenous economic momentum is still insufficient, and policies need to be continuously strengthened in Q4. The growth rate of social financing stock slowed down for the first time this year, mainly due to the high base last year, the decrease in government bond financing, and the weak demand for entity financing [38]. - **The "Anti-Involution" Policy Improves Deflation Expectations, but Profit Recovery Still Depends on Demand-Side Support**: The "anti-involution" policy proposed in early July is an important driving force for the stock market, but the policy's effectiveness takes time. The net profit of the four major index component stocks and the profits of industrial enterprises above the designated size are still at the bottoming stage. The price level is still weak, and the recovery of demand is insufficient. The scissors gap between the purchase price index and the ex-factory price index squeezes corporate profit margins. The PPI is expected to turn positive around Q2 2026 [41][46]. 4. Signs of Asset Allocation Transfer Appear, and the Pressure on the Capital Account May Continue to Ease - **Initial Signs of Asset Allocation Transfer**: After the loan prime rate (LPR) was lowered in May, commercial banks lowered deposit rates, and some banks' one-year fixed deposit rates fell below 1%. The increase in listed companies' dividends and the entry of rescue funds are changing the asset allocation behavior of residents. Funds are flowing from traditional bank deposits to non-bank financial institutions, and the A-share market is expected to receive sufficient allocation funds [50][53]. - **The Change in the Dominant Factor of the US Dollar and the Easing of Pressure on the Capital and Financial Account**: The US dollar's traditional safe-haven asset status is fading, and its price is now more influenced by interest rates. The continuous expansion of the US debt and geopolitical conflicts have eroded the US dollar's credit foundation, leading to a weakening trend. The weakening of the US dollar supports the RMB, and the capital and financial account is expected to recover [55][57]. - **The Unsustainable "Rush to Export" Trend and the Pressure on the Current Account**: During the Sino-US trade negotiations, the "rush to export" trend was obvious, supporting economic growth in the first three quarters. However, due to the high tariffs on Chinese exports and the passage of the "Big and Beautiful Act" in the US, the "rush to export" trend is difficult to sustain, and the current account will face significant pressure in Q4 [59][64]. 5. Summary - The US's tariff measures against China have limited room for adjustment, and the "rush to export" trend is difficult to sustain, putting more pressure on China's current account in Q4. However, the weakening of the US dollar eases the pressure on the RMB's passive depreciation, and cross-border capital flows are expected to continue to recover. Domestically, although the financial system's transmission efficiency has improved and the "anti-involution" policy may marginally improve deflation in Q4, the price increase still depends on demand-side support, and the deflation risk has not been completely eliminated. After the valuation repair of the A-share market, the relative attractiveness of equity assets has weakened. The profit recovery is the key to whether the market's overall center can rise. The PPI is expected to turn positive in mid-2026, bringing about a resonance of profit and valuation in the stock index market. The style may rebalance, and the previous hedging portfolio is recommended to be held, while investors should control their positions and focus on profit recovery [65][67].

Group 1 - The report by Morgan Stanley highlights the resilience and growth potential of the Chinese consumer market despite global economic uncertainties, projecting a 10.2% year-on-year growth in retail sales for 2024 [1] - Online consumption is expected to grow at a rate of 15.6% in 2024, significantly outpacing the 8.3% growth rate of offline consumption [2] - The share of service consumption is projected to increase from 45.9% in 2019 to 50.2% in 2024, indicating a shift in consumption structure [2] Group 2 - The spending power of Generation Z (born 1995-2009) is becoming more prominent, with their share of total consumer spending rising from 10% in 2019 to 15% in 2024 [2] - Consumer preferences are shifting towards quality, health, and personalization, with health food sales expected to grow by 22% and smart home products by 18% in 2024 [2] - The report identifies opportunities in emerging consumption sectors such as smart home technology, health food, and green consumption, particularly for companies with innovation capabilities and brand advantages [3] Group 3 - Leading companies in the smart home sector are projected to achieve over 30% revenue growth in 2024 [3] - The report notes potential risks such as economic slowdown, increased market competition, and rising raw material costs, which have increased by 10%-15% for some consumer goods companies in 2024 [3]

Core Viewpoint - Bilibili (BILI.US) is experiencing a pre-market increase of nearly 1%, reaching $22.5, driven by positive industry outlook and policy support for the gaming sector [1] Industry Summary - According to a report from China Merchants Securities, the gaming industry is expected to achieve high growth in the mid-year report, with third-quarter performance likely to continue improving on a quarter-over-quarter basis [1] - The current high level of industry prosperity is reflected in an average valuation of approximately 20 times, compared to a historical average exceeding 30 times, indicating potential for upward movement in valuations [1] - Future growth in the gaming sector is anticipated to transition from "alpha" driven performance to new "beta" drivers, fueled by the rise of emerging consumer trends and AI applications [1]

Group 1 - The overall performance of the gaming industry chain has exceeded market expectations, with strong performance anticipated in Q3 for companies like Huatuo, Tencent, and Gigabit [1][2] - The gaming industry has experienced significant growth due to policy support, with major companies reporting impressive mid-year results, such as Tencent's gaming revenue reaching 119.7 billion yuan, a 24% increase [2][3] - The average valuation of the gaming industry is currently around 20 times, with potential for upward movement compared to historical levels above 30 times [1][2] Group 2 - Emerging consumption and AI applications are expected to drive significant development in the gaming sector, with the industry benefiting from new consumer trends and technological advancements [3] - Global gaming companies like Nintendo and Take-Two have reached historical stock price highs, reflecting the industry's resilience to macroeconomic factors and its appeal to younger consumers [3] - The gaming industry is poised to be a major beneficiary of AI advancements, with companies having strong cash flows that may lead to acquisition opportunities in the AI space [3]