Group 1 - The basic chemical industry is showing a clear rebound trend, with fundamental risks largely cleared [1] - By the first half of 2025, the basic chemical industry has entered a phase of negative capital expenditure, with construction projects down 15% year-on-year, alleviating supply-side pressure [1] - Benefiting from fiscal and monetary policies, as well as the steady advancement of "two new" policies and "anti-involution" policies, demand is expected to increase, optimizing the supply-demand structure and continuously opening up profit margins in the chemical industry [1] Group 2 - The valuation of multiple varieties in the bulk commodity sector is at historical lows, providing a high safety margin and potential for high elasticity [1] - New materials and technologies are key development directions, with room for improvement in product penetration rates and domestic substitution, supported by industry demand and policies, leading to improved profitability and further valuation enhancement [1] - Green and environmentally friendly new technologies, such as chemical recycling of waste plastics, are supported by policies and are set to be a development direction for the coming years, with multiple catalysts including carbon taxes, legislation on recycled plastics, and the maturation of industrial technologies [1] Group 3 - The chemical leader ETF (516220) tracks a sub-sector chemical index (000813), which selects listed company securities from chemical raw materials, fertilizers, agricultural chemicals, and specialty chemicals to reflect the overall performance of high-growth and technologically advanced chemical enterprises [1]

Core Viewpoint - The basic chemical industry is showing a clear rebound trend, with fundamental risks largely cleared. The industry has entered a phase of negative capital expenditure in the first half of 2025, with construction projects down 15% year-on-year, and the introduction of the "anti-involution" policy is easing supply-side pressures, leading to an expected gradual optimization of the supply-demand structure [1] Group 1: Industry Trends - The basic chemical industry is experiencing a rebound, with significant improvements in the fundamental outlook [1] - The chemical price index has been at historical lows after a decline of over three years, indicating limited downside potential [1] - The demand side is expected to expand due to supportive fiscal and monetary policies, as well as the "two new" and "anti-involution" policies, which will continue to open up profit margins in the industry [1] Group 2: Investment Opportunities - The chemical sector's various commodities are currently at historical low valuations, providing a high safety margin and potential for high elasticity [1] - New materials and technologies, including green recycling technologies for waste plastics, are key development directions supported by policy, which may improve profitability and valuation [1] - The chemical leader ETF (516220) tracks a specific chemical index (000813) that includes listed companies in sectors such as pesticides, fertilizers, and coatings, allowing investors to capture the dynamics and investment opportunities in China's chemical sub-markets [1]