Market Overview - Trump's "Reciprocal Tariff 2.0" threat has been postponed to August 1, 2025, leading to a slight decline in U.S. stocks[1] - The inflation pressure from tariff threats has cooled market rate cut expectations, resulting in a rise in U.S. Treasury yields[1] - The 10-year U.S. Treasury yield increased by 6.75 basis points to 4.409% during the week from July 7 to July 11[1] Economic Indicators - The June FOMC meeting minutes released hawkish signals, with some dovish Fed officials showing caution towards rate cuts due to tariff impacts[1] - The NFIB small business optimism index for June recorded 98.6, unchanged from expectations and slightly down from the previous value of 98.8[1] - The Atlanta Fed's GDPNow model predicts a Q2 2025 U.S. GDP growth of +2.6%[1] Tariff Implications - Trump signed an executive order to extend the tariff deadline to August 1, announcing new tariff rates for 25 countries and regions, including Japan (25%), South Korea (25%), and Brazil (50%)[1] - Market reactions to the tariff threats have been relatively muted, with participants adopting TACO trading strategies, betting on further delays or cancellations of the tariffs[1] - The new tariff rates are seen as a pressure tactic in trade negotiations, with the possibility of further extensions beyond August 1[1]

Market Overview - The market continues to exhibit a "risk-off but not panic" sentiment, with commodities and Asia-Pacific equities leading the performance[4] - Natural gas and crude oil prices have surged due to OPEC+ production cuts and summer demand, breaking key resistance levels[4] - Silver prices have skyrocketed by 9% to $36 per ounce, the highest since 2012, driven by industrial demand and safe-haven buying[4] Asset Allocation Recommendations - Bond market shows strong value in short-duration high-grade credit bonds due to weak growth/inflation data and liquidity easing, but caution is advised as interest rate downside potential narrows[7] - U.S. equities are supported by economic resilience, although fundamental data shows marginal weakening[7] - Gold remains supported by slowing growth and safe-haven demand, but faces short-term pressure from risk appetite recovery[7] Economic Indicators - The Chinese Business Conditions Index (BCI) recorded 50.30, slightly above the expansion threshold but down 4.45 points from March's peak of 54.75, indicating a slowdown in economic momentum[40] - The U.S. economic surprise index has dropped to -6.7, reflecting weaker-than-expected high-frequency data, reinforcing rate cut expectations[53] Market Sentiment - The implied volatility (VIX) has reached a new low, indicating a market adaptation to the noise of tariff threats, with the dollar index down nearly 9% year-to-date, enhancing the appeal of non-U.S. assets[4] - A-share market liquidity is improving, with a daily average turnover of 1.186 trillion yuan, up 10.8% week-on-week, indicating increased investor participation[57] Risk Factors - Key risks include policy adjustment risks, market volatility risks, geopolitical shocks, economic data validation risks, and liquidity transmission risks[6][96]

Group 1 - The report indicates a prevailing market sentiment of "risk aversion without panic," with commodities and Asia-Pacific equity assets leading the performance, while volatility continues to decline [4][9] - Energy and precious metal prices have surged due to geopolitical disturbances and demand expectations, with natural gas and crude oil breaking key resistance levels supported by OPEC+ production cuts and summer demand [4][9] - The Hang Seng Index and Nasdaq Golden Dragon Index benefited from easing US-China trade tensions and anticipated consumer stimulus policies, leading to foreign capital inflows into Chinese stocks [4][9] Group 2 - The report suggests a favorable allocation towards short-duration high-grade credit bonds in the bond market, driven by weak growth/inflation data and liquidity easing, although caution is advised regarding the narrowing space for interest rate declines [7] - In the US stock market, economic resilience supports earnings, but the marginal weakening of fundamental data is noted, influenced by risk appetite [7] - Gold is expected to have long-term support from slowing growth and safe-haven demand, although short-term pressures from rising risk appetite are acknowledged [7] Group 3 - The report highlights a structural opportunity in the A-share market, focusing on sectors with superior earnings quality, despite a decline in valuation attractiveness [7][64] - The commodity market is under pressure from weak supply and demand, with only precious metals and certain energy products supported by safe-haven demand and supply-side disturbances [7] - Derivative strategies are recommended to focus on options protection or cross-commodity arbitrage due to a low volatility environment suppressing trend strategies [7] Group 4 - The macroeconomic perspective indicates a decline in the macro growth factor, with China's Business Conditions Index (BCI) slightly rising to 50.30, but still showing a significant drop from the March peak [40][41] - Liquidity conditions are improving, driven by strong policy signals, although the transmission mechanism to the real economy remains blocked [45] - Inflation indicators are trending downward, with PPI expectations hitting new lows, reflecting ongoing price pressures in the production sector [49] Group 5 - The report notes an increase in average daily trading volume in the A-share market, indicating improved investor participation and a neutral to strong liquidity environment [57] - ETF fund flows show a slight increase in stock and money market ETF sizes, suggesting a modest rise in investment sentiment [58] - A-share valuations have risen overall, but relative attractiveness has decreased, with the CSI 800's price-to-earnings ratio at the 45th percentile of the past three years [64]

1. Report Industry Investment Rating No relevant content provided. 2. Core Views of the Report - Macro level: US economic soft data has been revised, but the Fed's attitude remains hawkish, and the game between Powell and Trump will continue. Tariff risks have resurfaced, and the court's ruling on Trump's tariffs has been postponed. The "TACO" trading strategy is prevalent, and policy disturbances may be quickly repaired [3]. - Cost aspect: The shortage of nickel ore in Indonesia persisted throughout the month, and the price of laterite nickel ore continued to rise. Although there was information about a significant increase in the nickel ore approval quota in Indonesia in the middle of the month, the nickel ore price did not loosen, and cost support remained [3]. - Fundamental supply and demand: Both supply and demand decreased. The production of electrolytic nickel contracted slightly, but the export window remained open, and the overall domestic supply remained at a high level. The production of stainless steel decreased for the second consecutive month, and the inventory - reduction process was tortuous. The easing of tariffs did not effectively drive stainless - steel consumption. The production schedule of ternary materials was generally stable, and there were no obvious marginal changes in the fundamentals [3]. - Outlook: Trump's tariff policy may cause periodic disturbances at the macro level, but the policy disturbances may be quickly repaired. On the fundamentals, driven by the export window, the domestic supply of electrolytic nickel may remain at a high level. The inventory of stainless steel is being reduced, but the progress is slow, and the effect of rushing to export may be difficult to materialize. The new - energy consumption growth rate is gradually slowing down, and it is difficult for the demand side to show obvious increments. Overall, there is no expectation of improvement in the fundamentals, the cost - support logic remains, and the macro level may have periodic disturbances, but the correction expectation is strong. Nickel prices may fluctuate at a low level [3][40]. 3. Summary According to Relevant Catalogs 3.1 Market Review - In May, the main contract of Shanghai nickel fluctuated weakly. At the beginning of May, due to the boost of the China - US trade agreement, the macro - expectation was repaired, and the nickel price rose. However, as the stainless - steel inventory remained high, the expectation of rushing to export was frustrated, and the price weakened. In the late month, the rumor of a significant increase in the nickel ore approval quota in Indonesia dragged down the nickel price, but the price quickly recovered after the fall [8]. - The spot premium of refined nickel first weakened and then strengthened. Although the nickel price declined in May, the downstream purchasing enthusiasm was limited. The premium decreased from 2400 yuan at the beginning of the month to 2150 yuan on May 22nd. At the end of the month, affected by the sharp decline in the nickel price, the downstream purchasing was stimulated, and the premium rose from 2150 yuan on the 22nd to 2600 yuan on the 30th [10]. 3.2 Macro Analysis Overseas - US economic data was mixed. In April, the year - on - year growth rate of the US core PCE was 2.5%, in line with expectations, and the inflation pressure eased. The manufacturing performance was below expectations, with the ISM manufacturing PMI in May at 48.5. The labor market was generally stable [13]. - Tariff risks remained, but the actual disturbance was limited. Trump's tariff policy was initially stopped by the court but then the ruling was postponed. Although Trump raised tariffs on steel and aluminum products on May 30th, the market believes that his tariff policy will still follow the "high - start and low - end" pattern, and the "TACO" trading strategy is still popular, so the actual impact is limited [14]. Domestic - The performance of the manufacturing industry was divided, indicating that domestic demand was stronger than foreign trade. In May, China's official manufacturing PMI was 49.5, in line with expectations, and the demand - side data improved. However, the Caixin manufacturing PMI was weaker, reflecting the difficulties faced by small and medium - sized private manufacturing enterprises [15]. - Domestic consumption vitality was increasing. In April, the cumulative year - on - year growth rate of the total retail sales of social consumer goods increased for the second consecutive month, and the CPI growth rate was repaired [16]. 3.3 Fundamental Analysis 3.3.1 Nickel Ore Shortage Continued, and Ore Prices Kept Rising - The price of laterite nickel ore in Indonesia (1.5%) increased from $39.1 per wet ton to $40.8 per wet ton, while the price of 1.5% - grade nickel ore in the Philippines decreased from $51 per wet ton to $48.5 per wet ton. The supply of nickel ore in Indonesia was tight, and the price remained strong. Although there was news of an increase in the approval quota, the price did not loosen. The continuous rainfall in Indonesia and the Philippines affected the shipment of nickel ore [17]. - In April, China's nickel - ore imports were 291.41 tons, a year - on - year decrease of 1.03%. As of May 30th, the domestic port inventory was about 725.88 tons, a slight increase compared with the end of April but still at an absolute low level in the past three years [19]. 3.3.2 Electrolytic Nickel Supply Contracted Month - on - Month, and Upstream Cost Pressure Was Prominent - In May, the total output of refined nickel in China was 35,350 tons, a year - on - year increase of 37.82%. The capacity utilization rate was 65.34%, 16.13 percentage points lower than the expected level, and the over - capacity pattern continued. In April, the profit margins of all process lines of integrated electrowinning nickel decreased [20]. - In April, China imported 19,157 tons of refined nickel, a year - on - year increase of about 135.76%. The export volume was about 17,216 tons, a year - on - year and month - on - month increase of 150.3% and 18.51% respectively. The export window remained open, and the average monthly export profit in May was repaired to $204.78 per ton [22]. 3.3.3 Weak Downstream Buying, and Nickel - Iron Inventory Continued to Accumulate - In May, the price of high - nickel pig iron declined from 959 yuan per nickel point at the beginning of the month to 954 yuan per nickel point at the end of the month [24]. - In May, China's nickel - iron output was 25,800 metal tons, a month - on - month increase of 1.33%. In June, the expected production was 25,640 metal tons, a month - on - month decrease of 0.59%. The cost was strong, and only the Shandong pyrometallurgical BF process could maintain good profits, while the RKEF and EF processes had negative profit margins. The production of 300 - series stainless steel decreased for two consecutive months, and the terminal consumption was still weak. As of May 30th, the domestic nickel - iron inventory was about 275,500 tons (physical tons), an increase of about 27,500 tons compared with the end of April [25]. - In April, the domestic nickel - iron imports were about 816,900 tons, a year - on - year increase of 12.9% and a month - on - month decrease of 19.38%. The imports from Indonesia accounted for about 97.28% [26]. 3.3.4 No Obvious Increment in Demand, and the Expectation of Nickel Sulfate Was Stable - In May, the price of nickel sulfate fluctuated weakly. The price of battery - grade nickel sulfate decreased from 28,085 yuan per ton at the beginning of the month to 27,915 yuan per ton, and the price of electroplating - grade nickel sulfate decreased to about 30,000 yuan per ton [28]. - In May, the output of nickel sulfate was 26,015 tons (metal content), a year - on - year decrease of 20.51% and a month - on - month increase of 0.39%. The output of ternary materials increased. The output of 5 - series and 8 - series ternary cathode materials decreased month - on - month, while the production of 6 - series ternary materials expanded. Except for the process of producing nickel sulfate from nickel beans, which was still in a loss state, the profit margins of other process lines were positive. In April, China imported about 32,604 tons of nickel sulfate and exported 567 tons [29]. 3.3.5 Supply Contracted, and Inventory Was Slowly Reduced - In May, the price of 300 - series stainless steel increased slightly. The production of 300 - series stainless steel decreased for two consecutive months, and the net export scale in April decreased slightly. The downstream demand had no obvious increment. As of May 30th, the inventory of 300 - series stainless steel was 606,200 tons, a decrease of 32,600 tons compared with the end of April, but the inventory - reduction strength was less than the production - reduction strength, reflecting weak consumption [31]. 3.3.6 Limited Growth in the Power Sector, and the Industrial Track May Shift - From January to April, the cumulative sales volume of new - energy vehicles was about 4.3 million, a year - on - year increase of 46.26%. From May 1st to 25th, the retail sales of the new - energy passenger - vehicle market were 726,000, a year - on - year increase of 31%, but the growth rate was lower than the nearly 40% growth rate at the beginning of the year. The new - energy vehicle sales in May were generally stable, but the consumption increment momentum weakened [34]. - In the later stage, the sales increment of new - energy vehicles in the third quarter may be weak. The new - energy consumption policy is gradually shifting to new - energy heavy - duty trucks, ships and other transportation fields, which may partially fill the demand gap caused by the weakening of passenger - vehicle consumption [34]. 3.3.7 Supply Contraction Dragged Down Inventory Reduction - As of May 30, 2025, the domestic refined - nickel social inventory was about 41,553 tons, a decrease of 3,048 tons compared with the end of April; the SHFE inventory was 22,299 tons, a decrease of 2,009 tons compared with the end of April; the LME nickel inventory was 201,462 tons, an increase of 144 tons compared with the end of April. The supply reduction was slightly greater than the inventory - reduction amount, and the demand side was relatively weaker. In June, the domestic supply is expected to further contract, but the export window remains open, and the fundamentals may continue the pattern of weak supply and demand. The spot inventory may continue to be reduced due to the supply contraction [36]. 3.4 Market Outlook - Supply: The export window remains open, and the supply may remain at a high level [40]. - Demand: Steel - enterprise production control may suppress the production scale of stainless steel, and the expectation of rushing to export has not been fulfilled. The production schedule of ternary materials is expected to be stable [40]. - Cost: Although the nickel - ore approval quota in Indonesia has increased, the shortage situation has not been alleviated, and the ore price remains high [40]. - Macro: Tariff risks remain, but the "TACO" trading may quickly correct the situation [40].

Group 1 - The market is experiencing a slight upward trend due to a balanced and loose funding environment, with long-term bond yields rising slightly [1][2][4] - The People's Bank of China conducted a 454.5 billion yuan reverse repurchase operation, with a net withdrawal of 375.5 billion yuan today [2] - The interbank funding rates have shown a decline, with DR001 around 1.41% and DR007 around 1.55% [2][3] Group 2 - The 10-year government bond yield opened slightly lower at 1.67% but rebounded to around 1.675%, indicating a narrow fluctuation [4] - The Caixin Manufacturing PMI for May was below expectations, contributing to a slight increase in the stock market [4] - Different sectors are showing divergent trends, with "new consumption" and "hard currency" stocks reaching new highs, while "old economy" sectors like coking coal continue to decline [4]

Group 1 - The article discusses the recent performance of the Hong Kong stock market, highlighting its resilience despite global market pressures, particularly from U.S. tariff announcements [1][3] - The trading volume in the Hong Kong market has decreased significantly, with a drop from 270 billion to under 150 billion, indicating a lack of liquidity [2][3] - The article suggests that the Chinese assets are not experiencing significant declines, indicating a potential stabilization in the market [3] Group 2 - The article outlines the latest developments in the Russia-Ukraine conflict, particularly Ukraine's strategic retreat in negotiations, which may influence geopolitical dynamics [4][9] - A significant drone attack by Ukraine on Russian military targets is noted, marking a new phase in warfare tactics [5][7] - The article anticipates that developments in drone technology and counter-drone measures may impact A-share market themes [8] Group 3 - The article reports on Trump's announcement to increase U.S. steel import tariffs from 25% to 50%, effective June 4, as part of his strategy to bolster domestic steel production [9][14] - It highlights that the majority of steel exports to the U.S. come from Canada, Brazil, and the EU, with only a small fraction from China [13] - The article discusses the political motivations behind Trump's tariff actions, linking them to his declining approval ratings and the upcoming midterm elections [14][20] Group 4 - The article mentions a trading strategy known as TACO (Trump Always Chickens Out), which suggests that investors can capitalize on market dips caused by Trump's tariff threats [15][16] - It emphasizes that similar strategies can be applied in the A-share market, where rebounds often follow initial declines due to external pressures [20] Group 5 - The article provides an overview of market conditions in May, indicating increased trading difficulty compared to April, with a focus on technology stocks as a promising sector [21][25] - It notes that technology stocks have reached a favorable valuation range after adjustments, while other sectors like dividends and new consumption have become overcrowded [26][30] - The article outlines upcoming events in June that could catalyze movements in the technology sector, including major product launches and conferences [29][30]