1. Report Industry Investment Rating No relevant content provided. 2. Core Viewpoints of the Report - The current stock - bond state may be what the authorities desire, namely "a slow - bull in stocks and no continuous sharp decline in bonds." The monetary authorities maintain liquidity but avoid rapid policy rate cuts, using more structural tools and supporting the real estate market. This encourages the transfer of funds from real estate and bonds to equities, achieving a slow - bull in stocks and preventing continuous sharp declines in bonds and real estate to ensure financial stability [1][88]. - In September, the stock - bond state is likely to remain unchanged, and the headwind period for the bond market may not be over. The 10 - year Treasury yield has two pressure levels: 1.80% and 1.90%. Currently, it hovers around 1.78%. Short - term bond market operations may require patience, with more focus on band - trading during pullbacks. After two major macro - events in September (domestic military parade and Fed's decision on interest rate cuts), the bond market may enter a favorable period in late September and the fourth quarter [2][91]. 3. Summary According to the Table of Contents 3.1 Current Open Market Analysis - **Macroeconomic Environment**: The economic fundamentals are still "weak." In July, CPI was flat year - on - year, with core CPI rising to 0.8%. PPI's year - on - year decline remained at 3.6%, but the month - on - month decline narrowed. Financial data showed a seasonal decline in social financing, a contraction in credit financing, and a negative increase in new RMB loans for the first time in 20 years. Some economic indicators were divided, and domestic economic recovery was restricted by multiple factors [7][8]. - **Policy Environment**: The Fed's dovish stance is conducive to the implementation of domestic aggregate monetary policy in the fourth quarter. The central bank mainly uses structural policies and guides funds through a two - step allocation: in asset allocation, it guides funds from bonds to stocks; in economic development, it focuses on consumption, infrastructure, and real estate in sequence. If three of the four conditions are met, the probability of a domestic central bank's comprehensive interest rate cut is high, and currently, three conditions are gradually being met [24][27]. - **Bank Funding**: The bank funding situation has been relatively loose since July, with a slight reduction in net central bank money injection in July compared to June. As of August 14, the central bank's money withdrawal was 43,530 billion yuan, and the injection was 17,265 billion yuan. The 7 - day reverse repurchase rate remained stable at 1.40%, and market interest rates such as DR007 and FR007 showed a downward trend [28][31]. - **Corporate Profit and Financing Environment**: From January to July 2025, the total profit of industrial enterprises above the designated size continued to decline year - on - year, but the decline narrowed. The manufacturing PMI in July was 49.3%, below the boom - bust line. In July, corporate short - term and long - term loans decreased, and only bill financing increased year - on - year. Overall, industrial profits are still suppressed by price factors, and the financing structure is tilting towards bonds [37]. 3.2 Interest Rate Market Analysis - **Primary Market**: In July, the total issuance of interest - rate bonds was 3.2 trillion yuan, with a net financing of 1.53 trillion yuan. As of August 14, the total issuance was 1.9 trillion yuan. The issuance interest rates of four types of interest - rate bonds (Treasury bonds, local government bonds, policy - bank bonds, and inter - bank certificates of deposit) have shown a trend of convergence since January 2025, with the Treasury bond rate rising by more than 15BP [43]. - **Secondary Market**: From July to August 2025, the short - end interest rates of Treasury bonds remained stable, while the medium - and long - end rates generally increased, making the yield curve steeper. In July, the 10 - year Treasury yield rose from 1.65% to 1.70%, and in August, it fluctuated between 1.70% - 1.79%. The trend of China Development Bank bonds was different from that of Treasury bonds, and the spread between them widened [48][53]. 3.3 Credit Market Analysis - **Primary Market**: In July, the net financing of credit bonds was strong, with a net financing of 3,519 billion yuan. As of August 14, the issuance scale was 6,364.05 billion yuan, and the repayment amount increased to 8,742 billion yuan. The weighted average issuance interest rate of credit bonds in July was 1.91%, down 30BP year - on - year [67]. - **Secondary Market**: As of August 14, the yields of AAA - rated corporate bonds of various maturities declined, with the long - end decline being greater. Credit spreads continued to converge, and the spreads between AA and AAA - rated corporate bonds also narrowed [73]. - **Real Estate Bonds**: In July, the net financing of real estate bonds turned positive, with a net financing of 44 billion yuan. As of August 14, the net financing was negative. The transaction volume of commercial housing has been at a low level in the past five years, and as of August 9, the average weekly transaction area of commercial housing in 30 large and medium - sized cities decreased by 13.31% year - on - year [78][81]. - **Urban Investment Bonds**: In July 2025, the net financing of urban investment bonds was - 423 billion yuan, remaining at a historical low. This reflects the pressure on the financing environment of urban investment platforms and the acceleration of their transformation process [85]. 3.4 September Bond Market Strategy - The current stock - bond state is expected to continue in September. The bond market may still face headwinds, with 1.80% and 1.90% as two pressure levels for the 10 - year Treasury yield. Short - term bond market operations should focus on band - trading during pullbacks, and the bond market may improve after two major macro - events in September [2][91].

Group 1 - The Jackson Hole Global Central Bank Conference is set to take place, drawing significant attention from global financial markets, with expectations that Federal Reserve Chairman Powell will signal a rate cut in September during his speech on August 22 [1][3] - Historical data shows that U.S. stocks generally trend upward during the Jackson Hole conference period, with the S&P 500, Dow Jones, and Nasdaq indices typically reflecting positive performance due to optimistic expectations regarding central bank policy guidance [3] - The conference is often viewed as a platform for announcing key monetary policy shifts, with past speeches by Powell having substantial impacts on market sentiment, as evidenced by his hawkish remarks in 2022 that led to a decline in U.S. stocks [3] Group 2 - The current market environment presents unique challenges, with inflation data showing a complex trend, particularly in core services, where the super core service price increased from 0.21% to 0.48%, significantly above the average of the past two years, complicating Federal Reserve decision-making [4] - The labor market is sending mixed signals, with July non-farm payrolls adding only 73,000 jobs, well below expectations, and revisions to May and June data showing a downward adjustment of over 250,000 jobs, indicating a cooling job market [4] - Market expectations for a rate cut have reached high levels, with traders assigning a probability of over 92% for a 25 basis point cut in September, reflecting investor concerns about economic slowdown and adding pressure on policymakers [4] - Consumer data is showing weakness, with July retail sales growth at 0.5%, down from 0.9% in June, and core retail sales growth declining from 0.8% to 0.3%, indicating a decrease in consumer spending willingness and reinforcing expectations of economic downturn [4]