Group 1 - The core viewpoint highlights the domestic focus on "anti-involution" and the international attention on the US "Big and Beautiful" bill, which is expected to improve market expectations and alleviate recession concerns [1][4] - In China, major industries such as photovoltaic glass and cement are implementing production cuts and policy measures to stabilize growth and promote high-quality development [1] - The US "Big and Beautiful" bill is projected to positively impact economic growth in 2026 and 2027, with a deficit rate increase of over 1 percentage point compared to a scenario without the bill [1] Group 2 - The June PMI data indicates an improvement in market demand, with manufacturing PMI at 49.7%, up 0.2 percentage points from May, while the service sector PMI slightly decreased to 50.1% [1] - The construction sector shows significant activity, with the construction PMI rising to 52.8%, reflecting a 1.8 percentage point increase from May [1][2] - Employment data from the US shows a non-farm payroll increase of 147,000 in June, surpassing market expectations, which may reduce the necessity for short-term interest rate cuts by the Federal Reserve [4] Group 3 - The current economic environment presents a favorable outlook for A-shares, with improving supply-demand dynamics, easing US-China tariff issues, and positive market sentiment leading to the Shanghai Composite Index nearing 3500 points [6] - A recommended investment strategy includes a "dividend + technology" approach, focusing on dividend sectors like coal and consumption, alongside technology growth sectors such as semiconductor equipment and innovative pharmaceuticals [7]

Group 1 - The A-share market experienced a slight decline on June 26, with the three major indices showing a small drop, while the military industry sector remained strong and bank stocks performed well [1][3] - There was a significant net outflow of over 7.6 billion yuan from the stock ETF market, with the CSI 300 index and other broad-based indices seeing the largest outflows [2][3] - The total scale of all stock ETFs in the market reached 3.59 trillion yuan, with a reduction of 3.586 billion units in total shares on the same day [3] Group 2 - In contrast to the outflows in stock ETFs, bond ETFs and Hong Kong market ETFs saw net inflows of 5.926 billion yuan and 450 million yuan, respectively [3] - The CSI A500 index and the CSI Bank index attracted significant inflows, with over 6.1 billion yuan and 1.9 billion yuan, respectively, in the recent five trading days [3][5] - The Huatai-PineBridge CSI A500 ETF led the inflows with over 2.055 billion yuan on June 26, making it the top performer in the industry [4][3] Group 3 - The broad-based ETFs experienced the largest net outflows, totaling 5.525 billion yuan, with the CSI 300 index leading the outflows at 3.23 billion yuan [8][9] - The Huatai-PineBridge CSI 300 ETF saw a net outflow of nearly 1.4 billion yuan, ranking first in the industry for outflows [9][8] - Other ETFs such as the SSE 50 ETF and the CSI 500 ETF also experienced significant outflows, exceeding 500 million yuan each [9] Group 4 - Despite the short-term net outflows, several institutions recommend focusing on investment opportunities in related sectors, particularly in the brokerage sector, which is expected to benefit from public fund allocation and high growth [10] - The brokerage sector is currently trading at a price-to-book ratio of 1.4, indicating a potential investment window as historical percentiles suggest a favorable entry point [10]

1. Report Industry Investment Rating - No industry investment rating is provided in the report. 2. Core View of the Report - In the stage of strong macro - uncertainty, the low - volatility attribute of convertible bonds is prominent. In the short term, market pricing is expected to shift from macro - driven to industry - driven, and the combination of technology and dividend is still the best strategy [2][17]. 3. Summary by Related Catalogs 3.1 Market Focus Last Week (April 28 - April 30, 2025) - **Stock Market**: The equity market fluctuated narrowly before the holiday. The robot and AI - related industrial chains performed well, driving up sectors such as TMT, automobile, and machinery. Defensive sectors like banks and coal adjusted significantly. Most Shenwan primary industries closed down, with real estate (-3.04%), comprehensive (-2.75%), social services (-2.63%), and coal (-2.50%) leading the decline, while media (+2.69%), computer (+2.47%), beauty care (+2.46%), machinery and equipment (+1.59%), and electronics (+1.34%) performed well [8][9]. - **Bond Market**: The bond market rose significantly last week. With the central bank's support across months, the capital market was loose. Coupled with the expectation of weakening PMI and the lack of substantial progress in Sino - US tariff negotiations, bond market sentiment was positive. The 10 - year Treasury bond yield closed at 1.62% on Wednesday, down 3.63bp from the previous week [9]. - **Convertible Bond Market**: Approximately half of the convertible bond issues closed higher. The CSI Convertible Bond Index decreased by 0.07% for the whole week, the median price increased by 0.12%, the arithmetic average parity increased by 1.21%, and the overall market conversion premium rate decreased by 0.84% compared with the previous week. The arithmetic average conversion premium rates of convertible bonds in the par value ranges of [90,100), [100,110), and [110,120) changed by -0.09%, -0.04%, and -0.51% respectively, at the 36%, 48%, and 33% quantiles since 2021 [1][9]. 3.2 Views and Strategies (May 6 - May 9, 2025) - **Macro Environment and Market Trends**: Although the US initiated a tariff war in April, the probability of a marginal easing of tariff conflicts is higher in the short term. After the disclosure of annual and first - quarter reports, the impact of performance on the market has cleared. In May, the proportion of macro factors in stock market pricing may decrease, and the market is expected to return to being driven by industry logic. The "new economy" sector may be more cost - effective [2][17]. - **Bond Market**: The monetary policy was hawkish in the first quarter. Considering the long - term trade - war risk and the expectation of reserve requirement ratio cuts and interest rate cuts, the risk of a significant bond market adjustment is low. The low bond market interest rate means the opportunity cost of convertible bonds is extremely low, and the potential allocation power of convertible bonds is abundant [2][17]. - **Convertible Bond Market**: The average conversion premium rates in multiple par value ranges have returned to the levels in mid - January, significantly lower than during the spring market. The median price has returned to February 5, and the equal - weighted index of underlying stocks is around February 10. The low - volatility attribute of convertible bonds is prominent, which can reduce portfolio volatility while maintaining exposure to equity assets [2][17]. - **Investment Directions**: - **Dividend and Defensive Assets**: When the market tumbled on April 7, Hong Kong stock dividends were a direction for capital to increase positions. After the adjustment of the conversion price of some high - dividend convertible bonds, the par value increased by more than 5%. The power industry may see stock price increases from May to June [17]. - **Technology**: It includes opportunities in humanoid robots, semiconductor equipment localization, innovative drugs and related industrial chains, and the intelligent driving market [17]. 3.3 Valuation Overview - As of April 30, 2025, for equity - biased convertible bonds, the average conversion premium rates in different par value ranges are at different quantiles since 2010 and 2021. For debt - biased convertible bonds, the average YTM of those with a par value below 70 yuan is at the 31%/36% quantiles since 2010/2021. The average implied volatility of all convertible bonds is at the 52%/27% quantiles since 2010/2021 [18]. 3.4 Primary Market Tracking - **Last Week (April 28 - April 30, 2025)**: No convertible bond issuance was announced, and Weice Convertible Bond was listed. Weice Technology is a well - known third - party integrated circuit testing service enterprise. The issued convertible bond scale is 1.175 billion yuan, with a credit rating of AA [27]. - **Future Week (May 6 - May 9, 2025)**: No convertible bond issuance or listing is announced. As of April 30, there are 80 convertible bonds to be issued, with a total scale of 125.58 billion yuan, including 7 approved for registration with a total scale of 13.45 billion yuan and 6 approved by the listing committee with a total scale of 3.82 billion yuan [28].