1. Report Industry Investment Rating - No specific industry investment rating is provided in the report. 2. Core Viewpoints of the Report - The A-share market has been impacted by external conflicts and rising international energy prices, showing a volatile adjustment. However, the economic stabilization at the beginning of the year and the management's stance on the "stability" of the capital market during the Two Sessions have laid a foundation for "stability" expectations in the capital market. Short-term market over - adjustment may provide a good window period for medium - term allocation [2]. - The market is currently under pressure from multiple factors such as the escalation of the Middle East geopolitical conflict and rising inflation expectations. Investor risk - aversion is high, and global technology and growth stocks' valuations are being dragged down. The market is gradually lowering its expectations for interest rate cuts. The high yield of 30 - year treasury bonds challenges the expectation of loose market liquidity, which affects the core logic of the A - share slow - bull market [2]. - For the March market, maintain a defensive view. In the current market situation, position management may be a relatively effective risk - control measure. Controlling positions, observing more and acting less may be a relatively prudent choice [2]. 3. Summary by Directory 3.1 Market Review - **Weekly Market Performance**: Before the holiday, the four major indices were mainly in a volatile adjustment. The CSI 300 fell 2.19% weekly, the SSE 50 fell 2.47% weekly, the CSI 500 fell 5.82% weekly, and the CSI 1000 fell 5.25% weekly. The average daily trading volume of the four major indices decreased significantly compared with the previous week [2]. - **Domestic Data**: The valuation levels of the four major indices are presented in the charts. The basis and volatility of the four major stock index options have risen significantly. The European and American indices have declined, and the volatility has increased [10][14][20]. 3.2 Macroeconomic Analysis - **Domestic Macroeconomy**: Multiple economic indicators are presented, including GDP growth, industrial enterprise profits, social consumption, industrial added value, fixed - asset investment, real estate investment, manufacturing PMI, price indices, and import - export data. Some indicators show a trend of softening, while others are stabilizing and rebounding [26][28][30]. - **Domestic High - Frequency Data**: High - frequency data such as blast furnace operation, excavator sales, steel inventory, and real - estate - related data are provided, reflecting the short - term operation of the domestic economy [44][47][50]. - **Foreign Macroeconomy**: Key data of the US and the Eurozone, including employment, inflation, unemployment rate, and PMI, are presented, showing the economic situation of these regions [57][59][61]. 3.3 Market Sentiment - **Funding Aspect**: The funding cost remains stable in both the short and long term. The net currency injection in the open market is shown in the chart. The domestic capital's buying enthusiasm has slightly declined, as reflected in the financing balance, trading volume, and public fund data [67][71]. - **Important Market Information This Week**: The intensity of the US - Iran conflict's disturbance exceeds market expectations, and high oil prices may last longer. There are both positive and negative impacts on China's exports. A series of important events this week include geopolitical events, corporate earnings releases, product launches, and industry conferences [76].

Group 1: Oil Price Impact and Market Reactions - The blockade of the Strait of Hormuz has caused a global oil supply shock, reducing daily supply by approximately 20%, or 20 million barrels, which is ten times greater than previous conflicts like the Ukraine war[9][10]. - Initial market reactions to the oil price surge mirrored those during the Ukraine conflict, characterized by a strong dollar, rising bond yields, and declines in U.S. equities and gold[1][9]. - Despite the oil price shock being twice as severe as during the Ukraine crisis, the rise in the dollar and U.S. Treasury yields has been relatively muted, indicating that the market has not fully priced in the prolonged impact of high oil prices[1][17]. Group 2: Scenarios for Future Oil Prices - In a pessimistic scenario, if the conflict persists until the end of May, oil prices could rise to the range of $150-160 per barrel, with a potential 30% increase leading to a 75 basis point rise in Fed rate hike expectations[2][25]. - A neutral scenario suggests oil prices may stabilize between $100-120 per barrel, with market fluctuations continuing without significant changes in Fed rate expectations[2][26]. - An optimistic scenario could see the Strait of Hormuz partially reopen, allowing oil prices to drop back to the $80-100 range, which would likely renew expectations for Fed rate cuts[2][27]. Group 3: Investment Strategies and Risk Management - Emphasis on position management is crucial due to the unpredictable nature of geopolitical developments and market reactions, suggesting a strategy of "bottom positions + directional bets" to mitigate risks[3][48]. - For aggressive investors, focusing on sectors like power generation and energy storage is recommended, while conservative investors should consider high-dividend stocks as a stable base[3][49]. - The convertible bond market has faced challenges, with the index showing nearly zero returns year-to-date, indicating a need for careful observation of equity market stabilization before increasing exposure[3][51].

1. Report Industry Investment Rating No information provided in the content. 2. Core View of the Report - In the first week of March, after the Lantern Festival, the resumption of work accelerated further. However, the low - temperature and snowy weather in the north affected the start - up and resumption of work. The labor attendance rate was still strong year - on - year, indicating that major project investments in March might be building up momentum [3][32]. - In terms of inflation, food prices continued to decline after the Spring Festival. In terms of exports, due to geopolitical factors, fuel prices rose significantly, shipping capacity was affected, and container shipping prices generally increased significantly. In terms of investment, the social inventory of rebar continued to accumulate, the price weakened slightly, the downstream procurement demand was released orderly, and the physical work volume indicators had not yet stabilized significantly. In the real estate sector, the transactions of new and second - hand houses continued to rise, but the year - on - year increase in the lunar calendar decreased [3][32]. - For the bond market, the peak season starts in March. Due to the concentrated impact of work resumption this month and the possible sprint effect of the economy at the end of the quarter, an improvement in high - frequency data can be expected. This week, under the influence of the escalation of the US - Iran situation, energy prices such as crude oil rose significantly, intensifying market concerns about inflation. The cost of export container shipping prices also began to rise, and attention should be paid to the short - term suppression and fluctuations of shipping price changes on export demand. Domestically, the economic targets and policy combinations of the Two Sessions basically met expectations, the target growth rate was adjusted to a more neutral and reasonable range, and the probability of marginal stimulus decreased relatively. In addition, the PMI in February announced this week further declined due to the Spring Festival holiday, but it should be noted that in years when the Spring Festival falls in the middle or late February, the PMI in March often rebounds significantly, and the price sub - item last month was not weak. Short - term attention should continue to be paid to the evolution of inflation expectations [3][32]. 3. Summary According to the Directory (1) Inflation - related: Food prices are accelerating downward - The average wholesale price of pork in the country decreased by 3.9% week - on - week, and the vegetable price decreased by 4.1% week - on - week. After the Spring Festival, food prices are accelerating downward. The 200 - index of agricultural product wholesale prices and the wholesale price index of basket products decreased by 2.2% and 2.5% respectively week - on - week [8]. (2) Import and export - related: Geopolitical situation escalates, and freight rates are accelerating upward - The comprehensive container shipping index accelerated upward due to geopolitical factors. This week, the CCFI index increased by 0.9% week - on - week, and the SCFI increased by 11.7% week - on - week, showing an accelerating upward trend. The export container shipping market was affected by the sharp escalation of the geopolitical situation, and the freight rates of relevant routes fluctuated more severely, with the comprehensive index rising. Among them, the freight rate from Shanghai Port to the basic ports in the Mediterranean increased by 2.4% week - on - week, and the freight rates to the West and East coasts of the United States increased by 4.5% and 1.0% respectively [9]. - In terms of port transportation volume, from February 21st to March 1st, the container throughput and cargo throughput of ports increased by 6.4% and 25.2% respectively week - on - week, and the year - on - year increase for a single week was 6.3% and - 6.4% respectively. Overall, the resumption of work this year is relatively fast, and the year - on - year performance is still not weak under the influence of the Spring Festival misalignment [9]. - The BDI and CDFI indices accelerated upward. Affected by the US - Iran conflict, international fuel prices rose significantly, the ship operating cost increased, driving the daily rent and freight rates in the international dry bulk shipping market to rise significantly across the board. The BDI and CDFI indices increased by 1.8% and 8.1% respectively week - on - week [9]. (3) Industry - related: The resumption of work is accelerating further - Coal prices continued to rise. The price of thermal coal (Q5500) at Qinhuangdao Port increased by 1.9% week - on - week, with the same increase as the previous week. The low - temperature and snowy weather in the north led to a temporary rebound in the residential heating electricity load. After the Lantern Festival, the resumption of work and production in various places advanced, and the downstream replenishment and industrial electricity demand increased, supporting the continued rise of coal prices [15]. - The price of rebar weakened marginally. The spot price of rebar (HRB400 20mm) decreased by 0.1% week - on - week, and the social inventory of rebar increased by 12.4% week - on - week, continuing to accumulate at a relatively fast pace. This week, the resumption of work at construction sites accelerated, and terminal procurement gradually recovered [15]. - The asphalt production rate rebounded slightly. This week, the asphalt plant production rate increased by 1.9 percentage points week - on - week to 23.3%, but it was still at a seasonal low [15]. - The copper price decreased slightly. This week, the average price of copper in the Yangtze River Non - ferrous Metals market decreased by 0.4% week - on - week. The continued escalation of the US - Iran conflict led to a risk of energy supply disruption, suppressing market risk appetite and increasing risk - aversion sentiment, causing the copper price to decline week - on - week [18]. - The glass price remained stable, and downstream demand still needed to be repaired. This week, the glass market price was basically stable, the production and sales performance was average, the inventory in various places was still accumulating, the downstream procurement demand had not fully recovered, and the upward momentum of the spot price was limited. The South China glass futures price decreased by 0.3% week - on - week, also affected by risk sentiment [18]. (4) Investment - related: Real estate transactions continue to heat up - The cement price continued to decline. This week, the cement price index decreased by 0.2% compared with before the Spring Festival, continuing the downward trend. As of March 4th (the 16th day of the first lunar month), the resumption rate of construction sites across the country was 23.5%, the same as the year - on - year in the lunar calendar, and the labor attendance rate was 29.7%, 2.2 percentage points higher than the year - on - year in the lunar calendar. Among them, the year - on - year in the lunar calendar for real estate and non - real estate projects was 1.5 percentage points higher and 0.3 percentage points lower respectively. Overall, the resumption of work this week did not show a significant year - on - year improvement, which might be related to the suspension of some projects due to the snowy weather in the north. However, the labor attendance rate continued to improve, mainly supported by funds for projects such as guaranteed housing delivery, water conservancy, and high - speed railways [19][22]. - The transactions of new houses continued to recover seasonally, but the year - on - year increase in the lunar calendar narrowed. This week (as of Friday), the transaction area of new houses in 30 cities increased by 65.6% week - on - week. Aligned with the Spring Festival, as of March 6th, the transaction area of new houses in 30 cities (7 - day rolling sum) was 1.2896 million square meters, a year - on - year increase of 11.1%, and the year - on - year increase narrowed [27]. - The transactions of second - hand houses increased year - on - year at a relatively fast pace. This week (as of Friday), the transaction area of second - hand houses in 17 cities increased by 82% year - on - year. Aligned with the Spring Festival, as of March 6th, the transaction area of second - hand houses (7 - day rolling sum) was 115,000 square meters, a year - on - year increase of 23.3%, generally remaining strong [27]. (5) Consumption: The US - Iran conflict escalates, and oil prices are accelerating upward - The subway passenger volume in 25 cities accelerated its recovery. From last Saturday to this Friday, the average daily subway passenger volume in 25 cities was 3.163 million person - times, a week - on - week increase of 19.2%. The resumption of work accelerated further around the Lantern Festival. According to the Baidu Migration Scale Index, as of March 6th, the year - on - year travel decreased by 1.6%. The misalignment of the resumption of work rhythm after the holiday led to a high base, and the year - on - year performance began to weaken [30]. - Affected by the geopolitical situation, international oil prices continued to rise. As of March 6th, the prices of Brent crude oil and WTI crude oil increased by 27.9% and 35.6% respectively week - on - week compared with last Friday, showing an accelerating upward trend. The continued escalation of the US - Iran situation led to a decrease in the passage capacity of the Strait of Hormuz, increasing the uncertainty of global energy supply and pushing up oil prices to strengthen rapidly [30].

Core Insights - Recent spot gold prices have been rising, with market sentiment indicating a potential breakthrough of historical highs [1] - Factors such as global uncertainty, increased geopolitical risks, and adjustments in major central bank monetary policies have significantly enhanced the appeal of spot gold as a safe-haven asset [1] - Analysts note that fluctuations in the US dollar index, changes in US Treasury yields, and rising inflation expectations are providing strong support for spot gold prices [1]

Group 1: Federal Reserve Policy Shift - The Federal Reserve is transitioning from a hawkish to a dovish stance, with Chairman Powell indicating that inflation is nearing target levels and monetary policy will gradually shift towards easing [1] - Market expectations for a rate cut in November have surged to 92%, significantly lowering the holding cost of gold, which has led to gold prices breaking historical highs [1] Group 2: Geopolitical Risks - The escalation of the Russia-Ukraine conflict and the breakdown of negotiations over Iran's nuclear issue have heightened global risk aversion, resulting in a single-day influx of over $5 billion into gold [2] Group 3: Weakening Dollar Index - The dollar index has fallen from a high of 105 to below 103, which has positively impacted gold prices, as historical data shows that a 1% drop in the dollar index correlates with an average 1.2% increase in gold prices [3] Group 4: Central Bank Gold Purchases - Central banks globally have increased gold purchases, with a report indicating that by 2025, purchases will exceed 1,200 tons, and China's central bank has been increasing its holdings for 10 consecutive months, raising gold reserves to 7.2% [4] Group 5: Rising Inflation Expectations - Despite the Federal Reserve's attempts to control inflation, rising energy prices and supply chain disruptions are pushing inflation expectations higher, increasing the demand for gold as a traditional hedge against inflation [5] Group 6: Investment Recommendations - Short-term focus on a support level of $3,680 for gold, with a recommendation to increase the allocation to 15% of the asset portfolio for the medium to long term [6] Group 7: Technical Analysis of Gold - Gold has confirmed a "flag breakout" on the weekly chart, closing at $3,727, indicating strong bullish momentum [7] - The key resistance level of $3,700 has turned into strong support, with the next target at $3,820 based on Fibonacci extension [8] Group 8: Domestic Gold Market Insights - Domestic demand for gold jewelry has decreased by 24%, while investment gold bars have surged by 25%, indicating a shift from consumption to preservation of value [10][11] - The price difference between domestic and international gold has reached a historical high, presenting arbitrage opportunities for professional investors [12] Group 9: U.S. Treasury Yield Inversion - The 10-year U.S. Treasury yield has dropped below 4%, showing a strong negative correlation with gold prices, which reduces the holding cost of gold [14] - Bridgewater Associates has increased its holdings in gold ETFs from 15% to 25%, reflecting institutional concerns over stagflation risks [15] Group 10: Gold Mining and Recycling Trends - The average global gold mining cost has risen to $1,800, putting pressure on mining profits, suggesting a focus on low-cost leaders like Barrick Gold [17] - The volume of gold recycling has increased by 40% year-on-year, with a record 120 tons recycled in September [18] - The open interest in gold options has doubled, indicating a surge in market hedging demand [19]

Core Viewpoint - Despite the consumer price inflation rate in June reaching nearly double the central bank's 2% target, the market widely expects the Bank of England to lower the benchmark interest rate from 4.25% to 4% on Thursday, with further cuts anticipated by the end of the year [1] Global Context and Outlook - Following the Russia-Ukraine conflict in 2022, UK inflation surged, peaking at 11.1%, largely due to its heavy reliance on natural gas for heating and power generation. Inflation significantly decreased in 2023, projected to bottom out at 1.7% in September 2024, but is expected to rebound stronger than in the US and Eurozone. The June inflation rate rose to 3.6%, the highest since January 2024, with some economists predicting it will soon exceed 4% [2] Inflation Expectations - Most Bank of England officials view inflation expectations from businesses and households as crucial indicators for future price trends, wage demands, and the central bank's credibility. These expectations have been rising over the past year, with the Citigroup/YouGov long-term expectations index nearing its highest level since late 2022, while the central bank's own survey reached a new high since 2019. However, some officials believe these surveys reflect reactions to recent inflation rather than predictions of future behavior [5] Domestic Inflation Stickiness - Despite a significant drop in overall inflation in 2023, two key indicators of long-term domestic price pressures remain elevated: service price inflation, heavily influenced by labor costs, and core CPI, which excludes volatile factors, both consistently above overall inflation. Additionally, food and beverage prices, which greatly affect public inflation perception, especially among low-income groups, are accelerating [8] Wage Growth Trends - The annualized regular wage growth in the private sector has decreased from over 8% two years ago to just below 5%, yet it remains approximately 2 percentage points higher than pre-pandemic levels and well above the 3% benchmark deemed compatible with the 2% inflation target. The central bank and surveyed employers expect wage growth to further slow to 3% over the next 18 months, but the decline has not been steady, and rising unemployment and reduced job vacancies may not ensure a rapid cooling of wages as anticipated [11] PMI Cost Pressure Indicators - The S&P Global July Purchasing Managers' Index indicates that UK businesses are "strongly" raising prices. Although the rate of price increases has decreased compared to 2022, the current increase remains above pre-pandemic levels. Over the past year, costs in both the service and manufacturing sectors have risen significantly, which, if passed on to consumers, could elevate prices [14]

Group 1 - As of April 2025, China's gold reserves reached 73.77 million ounces, an increase of 70,000 ounces month-on-month, marking the sixth consecutive month of gold accumulation by the central bank [1] - The increase in gold reserves reflects a trend towards diversification in China's foreign exchange reserve investments, aligning with global central bank actions [1] - In the first quarter of this year, global central banks purchased 244 tons of gold, consistent with the normal quarterly purchase levels over the past three years [1] Group 2 - UBS predicts that central banks will buy approximately 1,000 tons of gold in 2025 due to rising structural demand for gold amid increased risk aversion [2] - Zhang Bo, a senior gold analyst, emphasizes that despite short-term adjustments in international gold prices, the long-term demand for gold will remain strong due to its monetary and financial attributes [2] - East China Futures forecasts a continued gold bull market driven by ongoing central bank purchases, U.S. debt monetization pressures, and the "de-dollarization" process, raising the 2025 gold price target to $3,500-$3,600 per ounce [2]