1. Report's Investment Rating for the Industry No information about the industry investment rating is provided in the report. 2. Core Views of the Report - This week, the Treasury bond futures market strengthened significantly, with the 30 - year and 10 - year main contracts rising 1.67% and 0.29% respectively. Market sentiment improved, as shown by the stronger performance of 30 - year contracts and the narrowing of various spreads. The trigger for this repair was the escalation of Sino - US conflict, and the subsequent pricing may need correction. A - share weakness might be an important factor for bond strength. Macro data indicates that domestic demand is moderately recovering, and inflation and financial data suggest the economy is showing signs of stabilization, but the recovery foundation needs to be consolidated [5]. - In the short term, due to increased market risk - aversion, loose domestic liquidity, and expectations of further monetary policy easing, Treasury bond futures are expected to remain strong. However, attention should be paid to the progress of Sino - US trade friction and the release of important domestic economic data. In the long - term, due to insufficient effective demand and potential trade frictions, deflation is likely to continue, and the bullish logic of bonds may persist under the support of monetary and fiscal policies [9]. 3. Summary by Relevant Catalogs 3.1 Main Views - Market performance: The 30 - year main contract (TL2512) and 10 - year main contract (T2512) of Treasury bond futures rose 1.67% and 0.29% respectively this week. The 30 - year contract was stronger than others, and spreads were narrowing [5]. - Reasons for market changes: The escalation of Sino - US conflict was the trigger, and A - share weakness might be an important factor. Macro data showed that domestic demand was recovering, with core CPI rising and PPI's decline narrowing. Financial data indicated that the economy was showing signs of stabilization [5]. - Short - term and long - term outlooks: In the short term, supported by risk - aversion, loose liquidity, and policy expectations, Treasury bond futures are expected to be strong. In the long - term, due to insufficient demand and potential trade frictions, deflation may continue, and the bullish logic of bonds may last [9]. 3.2 Liquidity Tracking - The report presents data on open - market operations (both quantity and price), medium - term lending facilities (quantity, price, and maturity), various interest rates (such as reverse - repurchase rates, MLF rates, and deposit - class pledge - style repurchase rates), and other liquidity - related indicators through multiple charts, including trends over different time periods [10][11][15] 3.3 Treasury Bond Futures Arbitrage Indicator Tracking - The report provides data on Treasury bond futures basis, net basis, implied repo rate (IRR), and implied interest rate for different maturities (2 - year, 5 - year, 10 - year, and 30 - year) through multiple charts, showing their trends over time [42][45][60]

Core Viewpoint - The banking sector demonstrates resilience amid a declining market, with several banks, including Agricultural Bank, Xiamen Bank, and Qingdao Bank, showing significant gains, indicating a potential investment opportunity in this sector [1][7]. Group 1: Market Performance - Agricultural Bank's stock rose over 2% during trading, reaching a historical high, and closed up 1.74% [1]. - The Bank ETF (512800) experienced a brief price surge of nearly 1% before closing slightly down by 0.12%, marking a seven-day consecutive increase in daily performance [1][3]. - The Bank ETF attracted a net inflow of 4.854 billion yuan over the past seven days, nearing a total size of 20 billion yuan, setting a new historical high [5]. Group 2: Investment Drivers - The banking sector is benefiting from multiple catalysts, including increased market risk aversion, leading investors to seek stable, high-dividend bank stocks [7]. - Ongoing policies aimed at economic stability are fostering expectations for recovery, which directly benefits the banking sector due to its close ties to economic cycles [7]. - Historical trends suggest that the fourth quarter is typically a favorable period for undervalued, high-dividend large-cap stocks, which may explain the current upward movement in bank stocks [7]. Group 3: Future Outlook - Analysts believe that the banking sector will become a key focus in the upcoming market phase, with defensive asset allocation driving demand for bank stocks [8]. - The stability of bank dividends and the recent price corrections have improved the attractiveness of bank stocks for risk-averse investors [8]. - The Bank ETF (512800) and its associated funds are efficient investment tools for tracking the overall banking sector, comprising 42 listed banks in A-shares [8].