Core Insights - The Inner Mongolia Autonomous Region's financial system has implemented a moderately loose monetary policy to support the real economy and facilitate economic recovery in the first half of 2025 [1] Financial Performance - As of June 30, the total balance of RMB loans in the region reached 32,616.8 billion yuan, an increase of 1,380.8 billion yuan from the beginning of the year, representing a year-on-year growth of 6.8% [2] - The balance of RMB deposits was 40,606.1 billion yuan, with an increase of 1,565.2 billion yuan year-to-date, reflecting a year-on-year growth of 7.2% [2] - The weighted average interest rate for newly issued loans decreased by 0.6 percentage points year-on-year, with corporate loan rates dropping by 0.74 percentage points, effectively lowering the financing threshold for enterprises [2] Support for Key Sectors - A financial policy framework consisting of "1 overall plan + 5 special plans" has been established to guide financial resources towards key areas [3] - A total of 34.7 billion yuan in loans was issued to support 38 technology-based SMEs and 26 technological transformation projects [3] - The green finance sector saw significant results, with 20 institutions utilizing 594.3 billion yuan in carbon reduction tools to leverage 990.5 billion yuan in loans, resulting in a reduction of 3,597,500 tons of emissions [3] Foreign Exchange Management - The total amount of foreign exchange receipts and payments reached 24.142 billion USD in the first half of the year [4] - The signing amount of foreign exchange derivative products was 1.195 billion USD, marking a year-on-year increase of 105.3% [4] - The pilot program for cross-border currency pools has been implemented, with companies like Yili and Baogang transferring 1.038 billion yuan [4]

Report Industry Investment Rating - Not provided in the given content Core Viewpoints - The logic of the market is the contradiction between macro and industry, with intensified long - short game [3] - Overseas macro: The US - Japan trade agreement sets a 15% tariff, and the US - EU is expected to implement 15%. Tariff negotiations are going smoothly, and overseas macro is biased towards maintaining high - interest rates in the short term. Domestic macro: The speculative atmosphere of coal and coke is strong. The exchange has warned of risks and restricted positions, causing the supply - side trading to cool down in the short term, and the demand side is waiting for the Politburo meeting. In the black产业链, steel demand in the off - season exceeds expectations, steel inventory is low, steel mill profits expand, and the decline of hot metal is slow, with poor negative feedback transmission [5] Summary by Relevant Catalogs 1. Overall Market Data - On July 25, 2025, the hot metal supply was 242.2 tons (a week - on - week decrease of 0.2 tons and a year - on - year increase of 2.6 tons), scrap steel supply was 46.5 tons (a week - on - week decrease of 2.3 tons and a year - on - year decrease of 0.2 tons), scrap steel demand was 51.8 tons (a week - on - week increase of 1.3 tons and a year - on - year increase of 6.2 tons), and scrap steel inventory was 459.7 tons (a week - on - week decrease of 4.4 tons and a year - on - year increase of 21.0 tons). For other steel products such as rebar, wire rod, hot - rolled coil, cold - rolled coil, and medium - thick plate, detailed supply, demand, inventory, and price data are also provided [4] 2. Macro - level Information - Overseas: The US - Japan and US - EU tariffs are confirmed, and the short - term tendency is to maintain high - interest rates. There are contradictions in the US regarding employment, inflation, and manufacturing return, which may damage the US dollar's credit. Domestic: The exchange's risk warning and position restrictions have cooled down the supply - side trading in the short term. The market is waiting for the Politburo meeting. There have been some real - estate favorable policies and debt - replacement measures in previous meetings [5][8][9] 3. Rebar Fundamental Data - **Price and Spread**: Last week, the Shanghai rebar spot price was 3430 yuan/ton (+180), the main futures price was 3356 yuan/ton (+209), the main - contract basis was 74 yuan/ton (-29), and the 10 - 01 spread was - 43 yuan/ton (+1). The spread is approaching the risk - free window, and reverse arbitrage should stop profiting and exit [14] - **Demand**: New - home sales remain at a low level, and market confidence is still weak. Second - hand home sales remain high, indicating the existence of rigid demand. Land transaction area remains low. Demand is in the off - season, and indicators such as cement shipments are seasonally declining [15][18][19] - **Inventory**: Steel inventory is at a low level and not accumulating, indicating low pressure on the industrial chain [21] - **Production Profit**: The "anti - involution" trading has led to a slight expansion of profits. Last week, the rebar spot profit was 427 yuan/ton (+103), the main - contract profit was 331 yuan/ton (+60), and the East China rebar valley - electricity profit was 293 yuan/ton (+156) [27][31] 4. Hot - Rolled Coil Fundamental Data - **Price and Spread**: Last week, the Shanghai hot - rolled coil spot price was 3500 yuan/ton (+160), the main futures price was 3507 yuan/ton (+197), the main - contract basis was - 7 yuan/ton (-37), and the 10 - 01 spread was - 11 yuan/ton (-1). Reverse arbitrage should stop profiting and exit [36] - **Demand**: Demand has weakened month - on - month. The US has imposed tariffs on steel - made household appliances, and the white - goods production has entered the off - season. The internal - external price spread has converged, and the export window has closed [37][40][41] - **Inventory and Production**: In the off - season, demand slightly exceeds expectations, and the inventory accumulation of hot - rolled coils has slowed down. Production has declined [43][45] - **Production Profit**: The "anti - involution" trading has led to a slight expansion of profits. Last week, the hot - rolled coil spot profit was 326 yuan/ton (+80), and the main - contract profit was 332 yuan/ton (+48) [47][50] 5. Variety Spread Structure - Attention should be paid to the opportunity of the expanding cold - hot spread [51] 6. Variety Regional Difference - The regional price differences of rebar, wire rod, hot - rolled coil, and cold - rolled coil are provided, including differences between cities such as Hangzhou, Beijing, Guangzhou, Shanghai, and Tianjin [60][61][62] 7. Cold - Rolled Coil and Medium - Thick Plate Supply, Demand, and Inventory Data - Detailed seasonal data on the total inventory, production, and apparent consumption of cold - rolled coils and medium - thick plates are provided [64][65]

Investment Rating - The report maintains a "Positive" investment rating for the non-ferrous and steel industry [5] Core Viewpoints - The report argues that the value reassessment of the strategic metals sector has just begun, contrary to some investors' belief that the recent rapid price increases indicate an impending peak [8][14] - It highlights three dimensions supporting this view: policy measures against strategic mineral smuggling, a tight supply-demand balance driving product prices up, and an increase in risk appetite due to political policy risk premiums [8][14][17] Summary by Sections Strategic Metals - Some investors believe the recent surge in strategic metals prices is unsustainable and may soon peak [8][13] - The report counters this by stating that the value reassessment of strategic metals is just beginning, driven by macroeconomic inflation, tight supply-demand dynamics, and political risk premiums [14][17] - Policy measures to combat strategic mineral smuggling are expected to be reinforced, particularly for rare earths and other strategic metals [15] - The supply-demand balance remains tight, with increasing demand from sectors like new energy vehicles and offshore wind power, leading to rising prices for rare earths [16] - Political policy risk premiums are expected to rise, enhancing the attractiveness of the strategic metals sector [17] Steel Industry - Steel prices are anticipated to continue rising due to production cut expectations [18] - Steel demand and production have decreased, but a dynamic balance in supply and demand is expected [18][25] - Inventory levels are showing differentiation among various steel products, with total inventory likely to decline further [25] - Cost increases in raw materials are pushing steel prices up, with profits for steel mills expected to recover [28] - The overall steel price index has seen a slight increase, with specific products like hot-rolled steel showing notable price rises [35] New Energy Metals - Lithium production in June 2025 saw a significant year-on-year increase of 20.95%, indicating strong supply growth [40] - The demand for new energy vehicles remains robust, with production and sales in June 2025 showing substantial growth [44] - Prices for lithium and cobalt have generally risen, while nickel prices have seen a decline [49][50] Industrial Metals - Global refined copper production has increased, with supply slightly better than expected [57] - The demand outlook is improving, with manufacturing activity expected to continue recovering [69]

Core Viewpoint - Canada has imposed a 25% tariff on imported products containing Chinese steel, which is seen as an attempt to shift the burden of its trade issues with the U.S. onto China [1][3] Group 1: Trade Relations - The Canadian government is responding to stalled trade negotiations with the U.S. by targeting China, hoping to gain favor with the U.S. by sacrificing Chinese interests [1][3] - The Chinese Ministry of Commerce criticized Canada's actions as a violation of WTO rules and indicative of unilateralism and protectionism [3][8] Group 2: Economic Impact - China's response includes a significant order worth $3.7 billion for agricultural products from Australia, effectively closing the door on Canadian canola exports, which previously accounted for 64% of Canada's total exports to China [3][4] - Canadian farmers are experiencing delays in soybean orders and significant port congestion, with 8 million tons of canola stuck at ports [4][6] Group 3: Domestic Reactions - Canadian farmers and agricultural associations are expressing dissatisfaction, with calls for the government to reconsider its approach to trade with China [6][7] - Internal divisions are emerging within Canada, with opposition parties questioning the government's strategy and its impact on farmers [6][7] Group 4: Comparative Analysis - Australia is seizing the opportunity to re-establish trade with China, utilizing a rolling procurement model that allows for flexibility and short-term gains [4][7] - Canada's concessions to the U.S. have not resulted in reciprocal treatment, leading to a cycle of dependency and loss of trade partners [7][8]

Report Industry Investment Rating No relevant content provided. Core Viewpoints - Risk preference increase impacts the bond market, with significant increases in short - to medium - term credit spreads. Credit spreads mostly rise, with larger increases in the short - to medium - term, and only spreads of 5 - year low - to medium - grade and 7 - year bonds narrowing [2][5]. - This week, most urban investment bond spreads rise. Spreads of external rating AAA, AA +, and AA platforms all increase by about 4BP [2][11]. - Industrial bond spreads generally rise by about 4BP. Central and local state - owned enterprise and mixed - ownership real estate bond spreads rise by 4 - 5BP, and private real estate bond spreads increase by 15BP [2][17]. - The yields of secondary and perpetual (two - type) bonds all rise. The spreads of 3 - to 5 - year high - to medium - grade two - type bonds increase significantly, and their overall performance is weaker than that of ordinary credit bonds [2][27]. - The excess spreads of industrial perpetual bonds remain flat, and the excess spreads of urban investment bonds decline slightly [2][32]. Summary by Directory 1. Risk preference increase impacts the bond market, with significant increases in short - to medium - term credit spreads - Domestic commodity prices rise sharply due to the expected "anti - involution" policy, and the A - share market hits a new high this year. The adjustment of interest - rate bonds intensifies, with the yields of 1Y, 3Y, and 5Y China Development Bank bonds rising by 4BP, 8BP, and 10BP respectively, and those of 7Y and 10Y bonds rising by 9BP [5]. - Some institutional liabilities are affected, leading to large - scale selling of credit bonds and a significant rise in yields. The yields of 1Y credit bonds of all grades rise by 10 - 11BP; the yields of 3Y AA and above - grade credit bonds rise by 10 - 11BP, and those of AA - grade bonds rise by 7BP; the yields of 5Y AA + and above - grade credit bonds rise by 11BP, and those of other grades rise by 6 - 8BP; the yields of 7Y AA + and above - grade credit bonds rise by 5 - 6BP, and those of AA - grade bonds rise by 3BP; the yields of 10Y AA + and above - grade bonds rise by 10 - 12BP, and those of AA - grade bonds rise by 8BP [5]. - Credit spreads mostly rise, with larger increases in the short - to medium - term. Only spreads of 5 - year low - to medium - grade and 7 - year bonds narrow. Rating spreads and term spreads show obvious differentiation [5]. 2. Spreads of all grades of urban investment bonds rise by about 4BP - This week, most urban investment bond spreads rise. Spreads of external rating AAA, AA +, and AA platforms all increase by 4BP. For AAA - grade platforms, spreads mostly rise by 3 - 4BP, with Hainan rising by 5BP, and Tianjin and Liaoning rising by 2BP; for AA + - grade platforms, spreads mostly rise by 3 - 4BP, with Jilin rising by 5BP, Yunnan and Tianjin rising by 2BP, and Qinghai remaining flat; for AA - grade platforms, spreads mostly rise by 2 - 5BP, with Gansu and Henan rising by 6BP, Hebei rising by 1BP, and Guizhou falling by 1BP [2][11]. 3. Industrial bond spreads generally rise by about 4BP - Industrial bond spreads generally rise by about 4BP. Central and local state - owned enterprise and mixed - ownership real estate bond spreads rise by 4 - 5BP, and private real estate bond spreads increase by 15BP. The spreads of Longfor rise by 3BP, those of Midea Real Estate rise by 4BP, those of CIFI rise by 160BP, those of Gemdale rise by 1BP, and those of Vanke fall by 4BP. Spreads of coal and steel bonds of all grades rise by 4BP respectively; spreads of chemical bonds of all grades rise by 3 - 4BP. The spreads of Shaanxi Coal Industry rise by 6BP, those of HBIS Group rise by 5BP, and those of Jinkong Coal Industry rise by 4BP [2][17]. 4. Spreads of 3 - to 5 - year two - type bonds rise significantly - This week, the yields of two - type bonds all rise. The spreads of 3 - to 5 - year high - to medium - grade two - type bonds increase significantly, and their overall performance is weaker than that of ordinary credit bonds. Specifically, the yields of 1Y secondary capital bonds of all grades rise by 7 - 8BP, and spreads rise by 2 - 3BP; the yields of 1Y perpetual bonds of all grades rise by 9BP, and spreads rise by 5BP. The yields of 3Y two - type bonds of all grades rise by 12 - 14BP, and spreads rise by 4 - 6BP. The yield of 5Y AAA - grade secondary capital bonds rises by 14BP, the yields of other grades rise by 17BP, and spreads rise by 7BP; the yields of perpetual bonds of all grades rise by 12 - 14BP, and spreads rise by 3 - 5BP [2][27][29]. 5. The excess spreads of industrial perpetual bonds remain flat, and the excess spreads of urban investment bonds decline slightly - This week, the excess spreads of AAA - grade industrial perpetual bonds remain flat. The spreads of 3Y industrial bonds remain at 3.82BP, at the 1.69% quantile since 2015, and the excess spreads of 5Y industrial perpetual bonds remain at 7.65BP, at the 4.55% quantile since 2015. The excess spreads of urban investment AAA 3Y perpetual bonds decline by 0.12BP to 3.63BP, at the 0.29% quantile; the excess spreads of urban investment AAA 5Y perpetual bonds decline by 0.41BP to 9.80BP, at the 9.10% quantile [2][32]. 6. Credit Spread Database Compilation Instructions - Market - wide credit spreads, commercial bank two - type spreads, and urban investment/industrial perpetual bond credit spreads are calculated based on ChinaBond medium - and short - term notes and ChinaBond perpetual bond data, with historical quantiles since the beginning of 2015. Urban investment and industrial bond - related credit spreads are compiled and statistically analyzed by Cinda Securities R & D Center, with historical quantiles since the beginning of 2015 [38]. - Industrial and urban investment individual bond credit spreads = individual bond ChinaBond valuation (exercise) - yield to maturity of same - term China Development Bank bonds (calculated by linear interpolation method), and then the industry or regional urban investment credit spreads are obtained by arithmetic mean method [38]. - Excess spreads of bank secondary capital bonds/perpetual bonds = credit spreads of bank secondary capital bonds/perpetual bonds - credit spreads of same - grade and same - term bank ordinary bonds; excess spreads of industrial/urban investment perpetual bonds = credit spreads of industrial/urban investment perpetual bonds - credit spreads of same - grade and same - term medium - term notes [38]. - Both industrial and urban investment bonds select medium - term notes and public - offering corporate bonds as samples, and guarantee bonds and perpetual bonds are excluded. If the remaining term of an individual bond is less than 0.5 years or more than 5 years, it is excluded from the statistical sample. Industrial and urban investment bonds use external entity ratings, while commercial banks use ChinaBond implicit debt ratings [38].

Report Industry Investment Rating - Not provided in the content Core View of the Report - The overall atmosphere in the commodity market is warm, and the prices of finished products continue to show a strong trend. The cost side provides obvious support for steel prices. The start of the Medog Hydropower Station has significantly increased the market's expectation for the future demand of building materials such as finished products and cement. In the short term, there is an expectation of production capacity reduction on the supply side, and the demand side is boosted by the launch of large - scale infrastructure projects. With the current low inventory levels of finished products, prices may have a basis for continuous strengthening. The market is currently more affected by policies and sentiment, and future attention should be paid to policy signals, terminal demand repair, and cost - side support [10][11] Summary by Relevant Catalogs 1. Week - ly Assessment and Strategy Recommendation - **Cost Side**: The hot - rolled coil's disk profit is 185 yuan/ton, and the spot premium over the disk is about - 167 yuan/ton, with a relatively high valuation [7] - **Supply Side**: This week, the output of hot - rolled coils was 3.17 million tons, a week - on - week change of - 37,000 tons, a year - on - year decrease of about 2.9% for the single week, and a cumulative year - on - year increase of about 0.4%. The daily average pig iron output was 2.4223 million tons, a week - on - week decrease of 210,000 tons, and the pig iron output remained at a relatively high level [8] - **Demand Side**: This week, the consumption of hot - rolled coils was 3.15 million tons, a week - on - week change of - 86,000 tons, a year - on - year decrease of about 3.9% for the single week, and a cumulative year - on - year increase of about 1.3%. Due to the price increase, the actual demand decreased slightly this week [9] - **Inventory**: This week, the hot - rolled coil inventory was 3.4516 million tons, with a slight accumulation [10] - **Trading Strategy**: The recommendation is to wait and see, and no specific trading strategy details are provided [12] 2. Spot and Futures Market - Multiple charts are presented, including the spot price of hot - rolled Q235B 4.75mm, various regional price differences, contract basis, futures price differences, and price ratios between different products, with data sources from MYSTEEL and the research center of Minmetals Futures [18][21][23] 3. Profit and Inventory - Charts show the gross profit per ton of hot - rolled and cold - rolled coils, the profits of blast furnaces and electric furnaces for rebar, and the inventory data of hot - rolled, cold - rolled, and coated plates, with data sources from MYSTEEL and the research center of Minmetals Futures [54][56][59] 4. Cost Side - Charts display the futures closing prices of iron ore, coke, and the price of scrap steel, as well as pig iron output, iron - making cost, and billet price, with data sources from MYSTEEL and the research center of Minmetals Futures [74][76][79] 5. Supply Side - Charts show the weekly output, cumulative year - on - year change, and capacity utilization rate of hot - rolled, cold - rolled, and coated plates in different regions and samples, with data sources from MYSTEEL and the research center of Minmetals Futures [91][93][98] 6. Demand Side - The consumption of hot - rolled coils this week was 3.15 million tons, with a week - on - week change of - 86,000 tons, a year - on - year decrease of about 3.9% for the single week, and a cumulative year - on - year increase of about 1.3%. Multiple charts show the apparent consumption of hot - rolled and cold - rolled coils, as well as the production and sales data of downstream industries such as automobiles, home appliances, and agricultural machinery, with data sources from MYSTEEL and the research center of Minmetals Futures [9][109][110]

1. Report Industry Investment Rating No relevant content provided. 2. Core Viewpoints of the Report - The market's focus is shifting towards medium - quality entities within industries such as steel, coal, real estate, local state - owned construction enterprises, and non - bank finance. In Q3, it is advisable to explore large - scale medium - quality entities in each industry. For institutions with high risk tolerance, there are opportunities to compress the liquidity premium of some high - quality private enterprises. For industries with low overall risks like public utilities, regular allocation is sufficient [5]. - For ultra - long credit bonds, it is time to gradually take profits, shorten the duration for defense, and switch to more liquid varieties, waiting for the next opportunity to attack [6]. - In Q3, different industries present various investment opportunities and risks. For example, the construction industry may see marginal improvement in prosperity but still face pressure; the steel industry has strong expectations of marginal improvement in fundamentals; the coal industry needs to select high - quality entities for exploration; the real estate industry has high - valued state - owned enterprises with certain investment potential; the non - ferrous metal industry has a differentiated prosperity; and the cement industry has limited opportunities [7]. 3. Summary According to Related Catalogs 3.1 Q3 Ultra - long Credit Bond Strategy: Gradually Take Profits and Wait for Subsequent Attack Opportunities 3.1.1 Primary Issuance - In Q2, the supply of ultra - long credit bonds increased month - on - month, with large industrial central state - owned enterprises remaining the main financing force. The total issuance in H1 was 539.8 billion yuan, and Q2 increased by 63% month - on - month, accounting for 9.27% of all credit bonds, but still lower than Q3 last year. The issuers were mainly industrial, accounting for about 72%, and large central state - owned enterprises such as State Grid had large issuance volumes [16]. - Since early July, the bond market has adjusted, and the supply of ultra - long credit bonds may be frustrated in the short term, and its subsequent recovery remains to be observed [18]. 3.1.2 Yield Analysis - To obtain significant excess returns from extending the credit duration, either interest rate decline or spread compression must occur, and the amplitude should be large enough [31]. - The trigger for the sharp decline of ultra - long credit bonds in recent years is mostly the reversal of institutional behavior. Currently, although it is predicted that there will be a double - bull market for stocks and bonds in the second half of the year, the short - term risk cannot be ignored due to the impact of the "stock - bond seesaw" on market sentiment [34]. - In terms of capital gains, the odds of ultra - long credit bonds are decreasing; the one - two - level arbitrage space is difficult to find; and the coupon protection ability is weak, making it difficult to increase the winning rate. Therefore, it is recommended to gradually take profits and switch to more liquid varieties such as 5Y bank secondary perpetual bonds [37]. 3.1.3 Strategy - For most institutions, it is time to gradually take profits from ultra - long credit bonds. The reasons include the difficulty in continuing the excess returns in the future, the fragility of the market's optimistic sentiment, the lack of obvious coupon advantages and protection ability, and the relatively small advantage compared with 5Y bank secondary perpetual bonds [46][51]. 3.2 Q3 Industrial Bond Strategy: Explore Industry Allocation Opportunities under "Anti - involution" 3.2.1 Construction - In 2025, the construction industry has been under pressure since the beginning of the year, and the downward trend in prosperity continued into Q2. In Q3, although factors such as accelerated capital arrival, the "anti - involution" initiative, and overseas growth are expected to bring marginal improvement in prosperity, the industry will still be under pressure overall, and industry concentration may further increase, benefiting leading central state - owned enterprises [48][52]. - In terms of bond valuation, the industry's valuation declined steadily in the second quarter. The spread of central state - owned enterprises narrowed, and some local state - owned enterprises had a large decline in valuation, but the valuation of some enterprises was still unstable [55]. - The strategy is to mainly explore subsidiaries of central state - owned enterprises and selectively allocate local state - owned enterprises. For institutions with low risk tolerance, continue to explore high - valued subsidiaries of central state - owned enterprises or leading local state - owned enterprises; for institutions that can accept a certain degree of credit quality downgrade, local state - owned enterprises provide greater return space, but it is not recommended to over - explore them [56]. 3.2.2 Steel - In Q2, steel prices fluctuated downward, but rose rapidly in early July under the support of cost and the expectation of "anti - involution" policies [60]. - In terms of fundamentals, supply is cautiously released, demand recovery in Q2 was less than expected, and total inventory is expected to further decline. In the short term, steel prices and steel enterprise profits are expected to be strong, but there is a risk of a callback [61][65][67]. - Medium - quality entities have strong motivation to compress spreads, and it is expected that the spreads of medium - grade mainstream entities such as HBIS and Shandong Steel will continue to compress. They can be appropriately allocated [71]. 3.2.3 Coal - In the second quarter, the price of thermal coal fluctuated downward and then rebounded at the end of the quarter, while the price of coking coal rose briefly in April and then fell, also rebounding at the end of June [74]. - In terms of fundamentals, the supply structure is relatively loose, and production inspections may lead to subsequent tightening. The demand for thermal coal is seasonally improving, while the probability of "oversupply" of coking coal is relatively large. Port inventories are continuously being depleted [76][80]. - It is expected that the coal price rebound may continue, with thermal coal being stronger than coking coal. In Q3, exploration still needs to select high - quality entities, and Jinmei Group is still the target of exploration by mainstream institutions [7][80]. 3.2.4 Real Estate - In Q3, the downward pressure on the real estate industry may continue to increase. The real estate sector is currently the highest - valued sector among state - owned enterprises, with a certain thickness of coupon and potential for exploration. Although the market is concerned about the emotional fluctuations brought about by Vanke's support willingness, the fluctuations are relatively controllable under the attraction of absolute returns, and it has cost - effectiveness [7]. 3.2.5 Non - ferrous Metals - In the non - ferrous metals industry, for gold, the market is mainly speculating on the Fed's interest rate cut expectation, and the long - term upward trend of the central price remains unchanged; for copper, the mining end is generally tight but with marginal increments, and the demand side is weak; for aluminum, the inventory has been depleted more than expected, and the demand - side risk is small, and the profit space of electrolytic aluminum plants is expected to continue [7]. - In terms of strategy, the valuations of high - quality but over - valued entities such as Nanshan Group, Hongqiao New Materials, and Luoyang Aluminum Industry are expected to continue to decline, while there are few opportunities for other entities [7]. 3.2.6 Cement - In Q2, cement prices almost declined unilaterally, and manufacturers faced the risk of losses. Attention should be paid to the implementation of over - production governance under "anti - involution." Currently, except for Hongshi, the spreads of the cement sector are basically compressed within 30bp, and it is difficult to obtain excess returns, so the overall opportunities in the cement sector are limited [7]. 3.2.7 Strategy - In Q3, explore large - scale medium - quality entities in each industry. The current spread of entities with a spread of 40 - 50bp is about 20bp different from that of leading entities, and it is expected that the spread will be compressed in Q3 [5]. 3.3 Q2 Industrial Bond Market Review: Convergent Trends and Deviation from Fundamentals 3.3.1 Issuance and Financing Situation - In Q2, industrial bonds had a large net inflow of 732.1 billion yuan, and public utilities led in net financing [14]. 3.3.2 Yield and Spread Trends - After the yield was repaired in Q2, it fluctuated at a low level. The trading logic was that the loose capital tone ran through the entire quarter, and the performance of different industries in the industrial bond market was not significantly differentiated, and the spread trend deviated from fundamentals [9]. 3.3.3 Liquidity - Since Q2, the liquidity of credit bonds has been continuously improving, and the trading heat of ultra - long credit bonds reached its peak in mid - June [14]. 3.3.4 Credit Risk - In Q2, there were 2 entities with substantial bond defaults and 4 domestic entities with rating/ outlook downgrades, but the overall credit risk was controllable [9].

1. Report Industry Investment Rating No relevant content provided. 2. Core View of the Report - The report introduces commonly used Wind function modules and data in credit bond research, including primary and secondary market modules and relevant data processing methods [4]. 3. Summary by Directory 3.1 Wind Primary Market Module Introduction - **Querying Credit Bond Issuance and Maturity Details**: For non - financial credit bonds, select enterprise bonds, corporate bonds, medium - term notes, short - term financing bills, and private placement notes; for financial bonds, select financial bonds and deselect policy bank bonds. Conceptual sectors and enterprise nature can also be selected [11]. - **Querying Inter - bank Credit Bond Approval Progress**: Use the "Bond - Special Statistics - Primary Market - Issuance Registration - NAFMII Bond Registration Statistics - NAFMII Bond Registration Review Progress" path [12]. - **Querying Exchange Credit Bond Approval Progress**: Use the "Bond - Special Statistics - Primary Market - Issuance Registration - Corporate Bond Issuance Review Progress" and "Bond - Special Statistics - Primary Market - Issuance Registration - Enterprise Bond Issuance Review Progress" paths [13][14]. - **Statistical Credit Bond Raised Funds Usage**: Use the "Bond - Special Statistics - Credit Bond Raised Funds Allocation" path [15]. - **Finding Bonds Meeting Specific Conditions**: Use the "Bond - Multi - dimensional Data - Bond Screening" path and set conditional expressions [16]. 3.2 Wind Secondary Market Module Introduction - **Credit Bond Market Monitoring**: Use the "Bond - Bond Secondary Market - Transaction Statistics" path to display the most active bond information under the subject rating and remaining term [23][24]. - **Querying Credit Bond Inventory Details**: Use the "Bond - Market Overview - Inventory Statistics (by Bond Type)" path [25]. - **Distinguishing Broker Transactions and Platform Transactions**: Broker transactions involve brokers helping investors find trading counterparts, while platform transactions occur on CFETS or exchange platforms. Broker transaction data is suitable for constructing price indicators, and platform transaction data is suitable for constructing volume indicators [26][64]. - **Querying First - time Default Issuers**: Use the "Bond - Special Statistics - Credit Bond Research - Bond Default - Enterprise First - time Default Report" path and manually exclude issuers with previous default/extension situations [32][33]. - **Querying Default Bond Details**: Use the "Bond - Special Statistics - Credit Bond Research - Bond Default - Bond Default and Extension Summary" path and exclude duplicate bonds, exchangeable/convertible bonds, and cross - market bonds [34]. - **Exporting ChinaBond Index Market Performance**: Use the "Index - Index Analysis - Index Directory" path [36]. - **Constructing a Bond Portfolio**: Use the "Asset Management - Investment Research - Portfolio Management" path, including adjusting the starting cash amount and entering bond holdings and adjusting weights [37][38][39]. - **Tracking Bond Portfolio Performance**: Use the "Asset Management - Investment Research - Portfolio Management - Portfolio Report" path [40]. - **Conducting Attribution Analysis of Bond Portfolio Performance**: Use the "Asset Management - Investment Research - Portfolio Management - Performance Attribution" path [43]. 3.3 Credit Research Common Data Processing Methods - **Credit Bond Net Financing**: Export bond issuance and maturity details within a specific time range, divide bonds into industrial bonds and urban investment bonds based on the urban investment list, and calculate the net financing by subtracting the maturity amount from the issuance amount [49]. - **Credit Bond Primary Market Issuance Heat**: Refer to subscription multiples and the difference between coupon rate and bid - rate floor. Subscription multiples are calculated as the total bid (subscription) volume divided by the actual issuance amount, and bonds without relevant data should be excluded [50][54]. - **Credit Bond Issuance Approval Situation**: For urban investment bonds, refer to the completed registration scale and its proportion, and the number of feedbacks from the inter - bank market or exchange before listing [58]. - **Analyzing Credit Bond Valuation Distribution**: Export inventory credit bond details, match each urban investment bond to its corresponding province, divide the remaining exercise period into intervals, and use the SUMIFS function to calculate the weighted average valuation [59][60]. - **Observing Credit Bond Secondary Market Transactions**: Use both broker transaction data and platform transaction data. Broker transaction data is used for price indicators such as transaction deviation, transaction yield, and high - valuation transaction proportion; platform transaction data is used for volume indicators such as transaction term and turnover rate [64]. - **Volume Indicators**: Weighted transaction term is calculated based on platform data by excluding bonds with a remaining term of less than half a year and using transaction amount as the weight; transaction number is the sum of each bond's transaction numbers [65]. - **Price Indicators**: Transaction yield is calculated as the weighted average of transaction amounts; transaction deviation reflects the market's buying sentiment; high - valuation transaction proportion is the proportion of transactions with a yield 5bp higher than the valuation [71].

Group 1: Q3 Super Long Credit Bond Strategy - The report suggests gradually taking profits on super long credit bonds and switching to shorter-term, more liquid varieties while waiting for the next investment opportunity [6][10][26] - In Q2, the issuance of super long credit bonds increased significantly, with a total of 539.8 billion yuan, marking a 63% increase from the previous quarter [10][12] - The report indicates that the current market conditions do not support further exploration of super long credit bonds due to declining odds of capital gains and limited arbitrage opportunities [26][27] Group 2: Q3 Industry Bond Strategy - The strategy focuses on identifying investment opportunities under the "anti-involution" initiative across various industries [6][10] - In the construction sector, while there is a marginal improvement expected due to funding acceleration and the "anti-involution" initiative, the overall industry remains under pressure [6][10] - The steel industry shows strong expectations for marginal improvement, with opportunities for continued compression of spreads among mid-tier players like Hebei Steel and Shandong Steel [6][10] - The coal sector anticipates a rebound in prices, with a focus on major players like Jin Energy, while cash flow improvements may exceed expectations [6][10] - The real estate sector faces increasing downward pressure, but state-owned enterprises still present attractive absolute returns [6][10] - In the non-ferrous metals sector, the report highlights a divergence in market conditions, with opportunities for compression in spreads among quality private enterprises [6][10] - The cement industry is under significant pressure, with risks of losses and limited opportunities for excess returns [6][10] - The overall strategy recommends focusing on medium-quality entities across industries, particularly in steel, coal, real estate, and construction, while keeping an eye on the "anti-involution" initiative and the commencement of the Yajiang Hydropower Station [6][10]

Macro Overview - In the first half of 2023, China's wholesale and retail industry added value reached 6.8 trillion yuan, with a year-on-year growth of 5.9%, accounting for 10.3% of GDP, providing strong support for expanding domestic demand and strengthening the domestic circulation [4] - The "Housing Rental Regulations" will take effect on September 15, 2025, establishing a rental price monitoring mechanism to curb issues such as deposit deductions and short-term payments for long-term leases [4] - The Ministry of Human Resources and Social Security is promoting the expansion of the basic pension insurance fund's entrusted investment scale and is researching further standardization of investment operation information reporting and disclosure systems [4] Industry Dynamics - The World Health Organization plans to officially release new guidelines for treating adult obesity based on GLP-1 therapy in September, with related stocks including Hanyu Pharmaceutical and East China Pharmaceutical [6] - Solid-state batteries are progressing from laboratory stages to mass production verification, with related stocks including Liyuanheng and XianDao Intelligent [6] - Neuralink, owned by Elon Musk, achieved a milestone by completing two surgeries in one day, with related stocks including Aipeng Medical and Innovation Medical [6] Company Focus - Dayu Water-saving has established project accumulation in Tibet and surrounding areas, aiming to seize the investment window for water conservancy in Tibet [8] - Wankai New Materials has seen monthly orders for its Linker Hand series exceed 1,000 units [8] - China Shipbuilding Emergency has organized a professional team to actively participate in large-scale hydropower projects [8] - Zoomlion Heavy Industry is expected to play a key role in the construction of the lower reaches of the Yarlung Tsangpo River hydropower project [8] Market Review and Outlook - On July 22, 2023, the market experienced a slight increase, with the Shanghai Composite Index rising by 0.62%, the Shenzhen Component Index by 0.84%, and the ChiNext Index by 0.61%, all reaching new highs for the year [10] - The market showed a mixed structure with most profits concentrated in the super hydropower concept, while over 2,700 stocks declined [10] - The trading volume reached 1.89 trillion yuan, an increase of 193.1 billion yuan compared to the previous trading day [10] - The super hydropower concept saw significant gains, with various sectors such as water conservancy, cement, and engineering construction performing well [11] - The market is expected to continue its consolidation phase, with a healthy structure of rising prices and increasing volumes, before any significant downturn occurs [11]