Core Points - The U.S. government is facing an unprecedented shutdown, potentially becoming the longest in history, which began on October 1 [1] - The shutdown is expected to have significant negative impacts on the U.S. economy, particularly in sectors like aviation, food, and healthcare, raising the risk of an economic hard landing [1] - The Congressional Budget Office estimates that the shutdown could reduce the U.S. GDP growth rate by 1-2 percentage points in Q4, with potential losses of $7 billion to $14 billion depending on the duration of the shutdown [2] - Consumer confidence is likely to be directly impacted, with delayed payments to federal employees and contractors exacerbating the situation, especially if the shutdown extends into the holiday season [2] - The shutdown poses a threat to U.S. sovereign credit ratings, with agencies like Scope Ratings downgrading the U.S. rating from "AA" to "AA-" due to deteriorating public finances and rising debt levels [3][4] - The shutdown has created a data vacuum, complicating economic assessments and policy decisions, which could lead to increased market volatility and uncertainty regarding future interest rate paths [5][6] - The liquidity tightening caused by the shutdown has led to a significant reduction in the Federal Reserve's reserve balances, further straining financial conditions and increasing borrowing costs [7]

Group 1 - The U.S. government shutdown has reached its sixth week, tying the historical record, with election results in New York, New Jersey, and Virginia seen as pivotal for changing the political dynamics in Washington and potentially breaking the budget deadlock [1] - Republican leaders express optimism about reaching an agreement to end the shutdown, but acknowledge that previously passed short-term funding bills are insufficient for the current situation [1][2] - The complexity of the deadlock is exacerbated by the House of Representatives not reconvening, which is necessary for any new funding bill to be approved [2] Group 2 - A new long-term temporary funding bill is being pushed, which may allow Democrats to negotiate for additional demands, including extending health insurance subsidies under the Affordable Care Act (ACA) [2] - The ongoing shutdown is causing significant disruptions, including flight delays due to staffing shortages at airports, and warnings from the Transportation Secretary about potential airspace closures if safety is compromised [2][3] - Economists warn that continued shutdown could lead to severe disruptions in aviation and logistics during the holiday season, negatively impacting GDP growth and prompting credit rating agencies to reassess U.S. sovereign credit [3]

Report Summary 1. Report Industry Investment Rating No industry investment rating is provided in the report. 2. Core Viewpoints The report objectively reflects the research views of futures and securities companies on various commodity varieties, tracks hot - spot varieties, analyzes market investment sentiment, and summarizes investment driving logics. It presents the market mainstream views on different asset classes, including their price trends, strategy viewpoints, and corresponding利多 and利空 logics [2]. 3. Summary by Related Catalogs 3.1 Market Data - **Commodities**: From May 12 to May 16, 2025, ethylene glycol had the highest weekly increase of 5.74% among commodities, while gold had the largest decline of 4.64%. Other commodities like iron ore, PTA, etc., also had different degrees of price changes [3]. - **Equities**: The NASDAQ Index had a significant increase of 7.15%, the Hang Seng Index rose 2.09%, while the CSI 500 decreased by 0.10% [3]. - **Bonds**: Chinese government bonds of 5 - year, 2 - year, and 10 - year terms all had price increases, with the 5 - year bond rising 4.06% [3]. - **Foreign Exchange**: The US Dollar Index increased by 0.56%, while the Euro - US Dollar exchange rate decreased by 0.76% [3]. 3.2 Commodity Views 3.2.1 Macro - Financial Sector - **Stock Index Futures**: Among 9 institutions' views, 2 are bullish, 1 is bearish, and 6 are neutral.利多 factors include successful Sino - US tariff negotiations, a relatively loose market capital supply, and growth in the social financing scale.利空 factors are net out - flow of industry funds, reduction in ETF shares, and conservative domestic policies [5]. - **Treasury Bond Futures**: Among 7 institutions' views, 0 are bullish, 2 are bearish, and 5 are neutral.利多 factors are the unchanged loose monetary policy and reduced expectations of fiscal stimulus.利空 factors are the recovery of market risk appetite and limited space for further interest - rate cuts [5]. 3.2.2 Energy Sector - **Crude Oil**: Among 9 institutions' views, 2 are bullish, 3 are bearish, and 4 are neutral.利多 factors are low global crude oil inventories, positive Sino - US negotiation results, and potential uncertainty in OPEC+ production increases.利空 factors are Iran's potential nuclear - deal signing and an increase in US crude oil inventories [6]. 3.2.3 Agricultural Products Sector - **Palm Oil**: Among 7 institutions' views, 1 is bullish, 2 are bearish, and 4 are neutral.利多 factors are the growth of Malaysian palm oil shipping data, increased export competitiveness, and potential replenishment demand in India.利空 factors are high inventory pressure and a decline in crude oil prices [6]. 3.2.4 Non - Ferrous Metals Sector - **Copper**: Among 7 institutions' views, 1 is bullish, 1 is bearish, and 5 are neutral.利多 factors are low copper concentrate TC, positive Sino - US tariff negotiations, and strong terminal demand.利空 factors are weak overseas demand and high inventory in China [7]. 3.2.5 Chemical Sector - **Soda Ash**: Among 7 institutions' views, 1 is bullish, 2 are bearish, and 4 are neutral.利多 factors are concentrated maintenance in May and high exports.利空 factors are high industry inventory, new production capacity, and weak downstream demand [7]. 3.2.6 Precious Metals Sector - **Gold**: Among 7 institutions' views, 1 is bullish, 0 are bearish, and 6 are neutral.利多 factors are the downgrade of the US sovereign credit rating and geopolitical uncertainties.利空 factors are the recovery of risk appetite and capital out - flow from gold ETFs [8]. 3.2.7 Black Metals Sector - **Iron Ore**: Among 7 institutions' views, 1 is bullish, 1 is bearish, and 5 are neutral.利多 factors are high molten iron production and low port inventory.利空 factors are expected increase in supply and weakening demand [8].

Core Viewpoint - Ray Dalio, founder of Bridgewater Associates, warned that Moody's downgrade of the U.S. sovereign credit rating is an understatement of the risks associated with U.S. Treasury bonds, as it does not account for the potential risk of the U.S. printing dollars to buy back its own debt [1] Group 1 - Moody's has downgraded the U.S. sovereign credit rating, which raises concerns about the risk associated with U.S. Treasury bonds [1] - Dalio emphasizes that the downgrade fails to consider the implications of the U.S. potentially printing money to repurchase its own debt [1]

Core Viewpoint - The downgrade of the U.S. sovereign credit rating by Moody's has led to a significant sell-off of U.S. Treasury bonds, resulting in a sharp increase in bond yields [1] Group 1: Impact on U.S. Treasury Bonds - On September 19, the yield on 30-year U.S. Treasury bonds surged, briefly exceeding 5% [1] - The yield on 10-year U.S. Treasury bonds also surpassed 4.5% during the same trading session [1] Group 2: Market Sentiment and Economic Outlook - Financial executive Max Gokhman indicated that the deterioration of the U.S. fiscal situation makes the credit rating downgrade unsurprising [1] - Bloomberg analysis suggests that rising Treasury yields may heighten market concerns regarding the U.S. dollar [1] - The Bloomberg Dollar Index has fallen back to levels close to those seen in April [1] - Sentiment indicators among options traders have dropped to the most pessimistic levels in five years [1]

Market Overview - On Monday, US stock indices opened lower but closed with slight gains, with the Dow Jones up 0.32%, Nasdaq up 0.02%, and S&P 500 up 0.09% [1] - The pharmaceutical and precious metals sectors saw significant gains, with Novavax rising over 15%, UnitedHealth up over 8%, and Moderna up over 6% [1] - In contrast, the solar, automotive, and oil & gas sectors experienced declines, with First Solar down over 7% and Murphy Oil down over 2% [1] - Most popular Chinese stocks fell, with the Nasdaq Golden Dragon China Index down 0.17% [1] Credit Rating Downgrade - Moody's announced a downgrade of the US sovereign credit rating from Aaa to Aa1 due to increased government debt and interest payment ratios [1] - This downgrade marks the first trading day following the announcement, and the US has now lost its highest credit rating from all three major international credit rating agencies [1] - White House National Economic Council Director Kevin Hassett described the downgrade as "lagging" and reaffirmed the safety of US Treasury bonds [1] Federal Reserve's Stance - Several Federal Reserve officials indicated that the economic outlook remains uncertain, suggesting that the Fed may not be ready to lower interest rates before September [2] - Fed Vice Chair Jefferson emphasized the need to monitor the impact of policy changes from the Trump administration on inflation [2] - New York Fed President Williams stated that it may take several months to gain clarity on the economic outlook, indicating a cautious approach to policy adjustments [2][3] Economic Uncertainty - Williams noted that while inflation has decreased and the economy is nearing full employment, attention is still required on default rates and consumer spending trends [3] - Atlanta Fed President Bostic echoed similar sentiments, suggesting a wait-and-see approach for 3 to 6 months to better understand economic conditions [3] - The Fed is currently balancing upward inflation pressures with recession risks, leaning towards only one rate cut this year [3]

Group 1 - Moody's has downgraded the U.S. sovereign credit rating, which may impact investor confidence and market stability [1] - The yield on U.S. long-term bonds has increased, indicating a shift in investor sentiment towards risk [1] - The analysis focuses on identifying key levels for gold prices in light of these developments [1]

Group 1 - The Federal Reserve plans to reduce its workforce by approximately 10% over the next few years, aligning with President Trump's initiative to streamline the federal government [3] - U.S. stock markets experienced gains, with the Dow Jones Industrial Average recovering all its losses for the year, closing up 0.78% [5] - The Dow Jones index saw a weekly increase of 3.41%, while the S&P 500 and Nasdaq rose by 5.27% and 7.15% respectively, driven by strong performance in technology stocks [7] Group 2 - The University of Michigan's consumer sentiment index fell to its second-lowest level in history, with respondents expecting a 7.3% increase in U.S. prices over the next year, the highest since 1981 [9] - Moody's downgraded the U.S. sovereign credit rating from Aa3 to Aa1, citing increased government debt and interest payment ratios, while changing the outlook from "negative" to "stable" [9]

Core Viewpoint - The U.S. Treasury Secretary has warned that the federal government's cash reserves and means to control debt within the legal limit may run out by August, urging Congress to act before the mid-July recess to raise or suspend the debt ceiling [1][2][4] Group 1: Debt Ceiling and Government Operations - The U.S. reached its current debt ceiling of $36.1 trillion in early January and has been using "extraordinary measures" to avoid default [1][2] - Most extraordinary measures have been exhausted as of April 30, with remaining funds only sufficient to support operations until June or July [3][4] - If Congress does not act to raise the debt ceiling, the Treasury may face a situation where it cannot meet all government obligations by August [2][3] Group 2: Political Challenges - Republican lawmakers are attempting to pass legislation to raise the debt ceiling by $5 trillion, but political difficulties are anticipated in voting on the debt ceiling [1][6] - The Trump administration is looking to combine the debt ceiling increase with fiscal spending bills, aiming to raise the limit to $41 trillion [6] - Historical conflicts between Democrats and Republicans over the debt ceiling have made negotiations increasingly complex, with divisions also present within the Republican party [6] Group 3: Credit Rating and Economic Implications - The inability to raise the debt ceiling could severely damage the U.S. financial system and weaken its global leadership [4] - Credit rating agencies have previously downgraded U.S. sovereign credit ratings due to high debt levels, and further downgrades could occur if the debt ceiling is not addressed [4][5] - A potential default could lead to increased borrowing costs for the U.S. government and a loss of confidence in U.S. Treasuries as a safe asset, impacting the dollar's status as a global reserve currency [5]