Core Insights - The market is experiencing significant growth driven by AI-related stocks, with a 32% increase in 2024 and a further 17% rise in 2025, leading to a high expected P/E ratio of 22 for the S&P 500, which is in the 96th percentile historically [1][2] Group 1: Market Valuation and Growth Expectations - Current market prices imply a long-term earnings growth expectation of about 10%, slightly above the historical average of 9%, but well below the 16% during the 2000 tech bubble and 13% at the 2021 peak [2] - The average expected P/E ratio for the top five tech giants (NVIDIA, Microsoft, Apple, Google, Amazon) is 28, significantly lower than the 40 at the 2021 peak and 50 during the tech bubble [2] Group 2: AI Investment and Infrastructure - Goldman Sachs categorizes the evolution of AI trading into phases, with the current phase being a "frenzy of infrastructure investment," fueled by substantial capital expenditures from major cloud service providers, which are projected to reach $368 billion by 2025 [3] - This massive investment is translating into increased orders and profits for suppliers of semiconductors, power equipment, and technology hardware, driving their stock prices up [3] Group 3: Risks and Market Sentiment - There is a warning regarding the potential slowdown in capital expenditures, which could lead to a 15-20% correction in stock valuations if spending reverts to 2022 levels, impacting S&P 500 expected sales growth by approximately 30% [4] - Analysts predict a significant deceleration in capital expenditure growth by late 2025 and into 2026, which poses a risk to the valuations of related stocks [4] Group 4: Future Market Phases - As the infrastructure investment phase peaks, the market is looking towards the next phase, where AI-enabled companies are expected to drive revenue growth [5] - Investor interest in the "third phase" companies, particularly in the software sector, is limited due to concerns about AI potentially disrupting existing pricing models and profit margins [6] - The long-term "fourth phase" of AI-driven productivity improvements is still in its early stages, with only 58% of S&P 500 companies mentioning AI in earnings calls, but few can quantify its impact on current profits [6]

Market Overview - Pre-market futures are mixed but showing signs of weakening, following record high closes on the S&P 500, with profit-taking being a potential factor [1] - The tech-heavy Nasdaq is up by 42 points (+0.18%), while the Dow is down by 300 points (-0.67%) due to UnitedHealth's DOJ probe [2] Job Market Data - Initial Jobless Claims decreased to 217K, marking the lowest level in 14 weeks and the sixth consecutive week of decline [3] - Continuing Claims are reported at 1.955 million, slightly above the previous week's revised figure, indicating a stall just below 2 million [4] Q2 Earnings Reports - American Airlines (AAL) reported earnings of 95 cents per share, exceeding expectations by +20.25%, but shares fell -6% due to warnings of softer demand [5] - Honeywell (HON) surpassed earnings expectations with $2.75 per share, a +4.2% increase from the previous year, but shares are down -2.7% as the company plans to split into three segments [6] - Union Pacific (UNP) reported earnings of $3.03 per share, beating expectations by +4.84%, with revenues of $6.2 billion also exceeding forecasts, though shares are down -3% [7] Economic Indicators - S&P flash Services PMI for July is expected to rise to 53.2, while Manufacturing PMI is anticipated to dip to 52.7, both remaining above the growth threshold of 50 [8][9] - New Home Sales for June are projected at 645K units, an increase from 623K in the previous month, despite disappointing Existing Home Sales figures [10] Upcoming Earnings Reports - Intel and Deckers Outdoor are scheduled to report their Q2 earnings after the market closes today [11]

Group 1 - HSBC's report indicates that risk assets are expected to rise in the second quarter, driven by earnings season, while tariff issues may also become a favorable factor [1] - The market sentiment and positioning indicators from HSBC have issued sell signals, suggesting that optimistic sentiment has an "expiration date" [1][3] - HSBC is examining potential adverse scenarios to enhance bearish sentiment further [1] Group 2 - HSBC identifies two misconceptions regarding tariffs: investors view tariff deadlines as fixed, and the market may welcome potential delays [2] - The sensitivity of the market to tariff news has decreased, similar to the behavior observed during the COVID-19 pandemic, suggesting that recent tariff rate reductions could boost confidence in risk assets [2] - Warning signals have emerged, with short-term sentiment and positioning indicators issuing significant sell signals, marking the most notable signal since mid-2023 [3]

Report Industry Investment Rating No relevant content provided. Core View of the Report Through macro - fundamental analysis and technical analysis using tools such as the Fibonacci retracement, horizontal lines, and moving averages, the report anticipates the following trends for major futures contracts on May 16, 2025: stock index futures will fluctuate and consolidate; 10 - year and 30 - year treasury bond futures will likely experience wide - range fluctuations; gold, silver, copper, aluminum, alumina, PTA, and styrene futures will likely fluctuate with an upward bias; rebar, hot - rolled coil, iron ore, coking coal, glass, soda ash, methanol, soybean meal, and PVC futures will likely fluctuate with a downward bias; crude oil futures will fluctuate and consolidate; and container shipping index (European line) futures will likely fluctuate with a slight upward bias [2]. Summary by Relevant Catalogs 1. Macro News and Trading Tips - China's economic policies include promoting domestic circulation, urban renewal, and technological finance. Tax data shows accelerated enterprise sales growth in April, with a 4.3% year - on - year increase in national enterprise sales revenue and a 6.5% increase in construction industry sales revenue. The "Swap Connect" product types are to be enriched [7][8]. - Internationally, the Fed is considering adjusting its monetary policy framework, and Powell predicts a 2.2% year - on - year increase in US PCE in April. The US and Iran are negotiating a nuclear deal. The EU is revising its trade agreement proposal with the US. The UK's Q1 GDP grew by 0.7% quarter - on - quarter [9][11][12]. 2. Commodity Futures - Related Information - On May 15, international precious metal futures generally rose, with COMEX gold futures up 1.74% and COMEX silver futures up 1.07%. International oil prices dropped significantly, with US crude oil down 2.31% and Brent crude down 2.22%. London base metals closed mixed [12][13]. - The IEA expects global oil demand growth to slow to 650,000 barrels per day for the rest of the year and has lowered its forecast for US shale oil production for the second consecutive month [13]. 3. Futures Market Analysis and Outlook Stock Index Futures - On May 15, major stock index futures contracts such as IF2506, IC2506, and IM2506 opened slightly lower, rebounded but faced resistance, and then declined. A - shares weakened, with a total trading volume of 1.19 trillion yuan. High - frequency data shows that Goldman Sachs has raised its 12 - month target prices for the MSCI China Index and the CSI 300 Index [14][15][16]. - It is expected that in May 2025, major stock index futures contracts will likely fluctuate with an upward bias in a wide range. On May 16, they will fluctuate and consolidate [18][19]. Treasury Bond Futures - On May 15, the 10 - year treasury bond futures contract T2506 opened slightly higher, fluctuated slightly upward, and the 30 - year contract TL2506 also opened slightly higher and rose. The central bank conducted 645 billion yuan of 7 - day reverse repurchase operations, resulting in a net withdrawal of 2.191 trillion yuan [39][44]. - It is expected that on May 16, the 10 - year and 30 - year treasury bond futures contracts will likely experience wide - range fluctuations [41][46]. Precious Metal Futures - On May 15, gold and silver futures contracts AU2508 and AG2508 opened lower, rebounded but faced resistance, and then declined. International precious metal futures generally rose on the same day [46][51]. - It is expected that in May 2025, gold futures will likely fluctuate with a downward bias in a wide range, and silver futures will likely fluctuate in a wide range. On May 16, both will likely fluctuate with an upward bias [48][49][51]. Base Metal Futures - On May 15, copper, aluminum, and alumina futures contracts opened slightly lower or higher, rebounded but faced resistance, and then showed different trends. It is expected that in May 2025, these futures will likely fluctuate with an upward bias, and on May 16, they will also likely fluctuate with an upward bias [58][62][68]. Building Materials and Energy Futures - On May 15, rebar, hot - rolled coil, iron ore, coking coal, glass, soda ash, and PVC futures contracts generally opened slightly lower, rebounded but faced resistance, and then showed downward - biased fluctuations. Crude oil futures contracts opened slightly lower and declined significantly [74][79][94]. - It is expected that in May 2025, rebar, iron ore, and crude oil futures will likely fluctuate with an upward bias in a wide range. On May 16, rebar, hot - rolled coil, iron ore, coking coal, glass, soda ash, and PVC futures will likely fluctuate with a downward bias, and crude oil futures will fluctuate and consolidate [74][80][94]. Chemical Futures - On May 15, PTA, styrene, and methanol futures contracts opened slightly lower, rebounded but faced resistance, and then showed different trends. It is expected that on May 16, PTA and styrene futures will likely fluctuate with an upward bias, and methanol futures will likely fluctuate with a downward bias [100][105][108]. Agricultural Futures - On May 15, the soybean meal futures contract opened slightly lower, rebounded slightly, and then showed a slight upward trend. It is expected that on May 16, it will likely fluctuate with a downward bias [110]. Container Shipping Index (European Line) Futures - On May 15, the container shipping index (European line) futures contract EC2508 opened with a large gap up, fluctuated upward significantly, and then showed a strong upward trend. It is expected that on May 16, it will likely fluctuate with a slight upward bias [112].

Core Viewpoint - Nvidia has faced significant challenges in 2023, including growth concerns, supply chain issues, and regulatory risks, leading to a nearly 15% decline in stock price, which is much greater than the 1% drop in the semiconductor sector and the S&P 500 index. However, Bernstein analysts suggest that this may not be the end for Nvidia, as the Blackwell product cycle is accelerating and current valuations are becoming increasingly attractive [1][4]. Valuation Analysis - Nvidia's current valuation has dropped to a low point, with a forward P/E ratio of approximately 25, marking the lowest level in the past year and nearing a 10-year low. The trading price relative to the Philadelphia Semiconductor Index is below parity, a rare occurrence in the past decade, and the premium over the S&P 500 index is minimal, the lowest since 2016 [2]. Product and Demand Insights - Despite initial challenges with the Blackwell launch, issues have been resolved, with Nvidia reporting $11 billion in Blackwell revenue for Q4, indicating that supply chain bottlenecks have been alleviated. Demand is expected to continue exceeding supply in the coming quarters, with customer capital expenditures on the rise. Additionally, the DeepSeek technology is not seen as a threat to AI demand but may actually accelerate growth [3]. Market Sentiment and Future Outlook - Bernstein believes that concerns about the "AI trade being over" are premature. Nvidia's current valuation is becoming more attractive as market sentiment shifts to caution, yet corporate spending willingness is on the rise, and the product cycle is just beginning. The upcoming GTC conference is also anticipated to be a significant event [4]. Historical Performance - Historically, when Nvidia's P/E ratio falls to 25 or below, investors have typically seen substantial returns, with an average next-year return rate of 150% and relatively limited downside risk [5].