Group 1: Economic Impact of Tariffs - Businesses and consumers began feeling the effects of President Trump's tariffs in mid-2025, leading to economic uncertainty and inflation, but some experts believe the U.S. may see advantages as stability returns [1] - The tariff environment has required a major reorientation of distributors and resellers, but there is now a sense of stability regarding tariffs for the next year [2] - Domestic manufacturers are expected to benefit from reduced competition and increased pricing power due to tariffs impacting foreign firms [3] Group 2: Sector-Specific Effects - Sectors such as electronics, beauty products, home goods, toys, and clothing are already experiencing impacts from tariffs, with the "de minimis" tariff rule affecting offshore retailers like Shein and Temu [2] - Shipping and logistics companies face increased processing workloads due to tariffs, which adds costs and slows delivery times [3] Group 3: Consumption and Environmental Considerations - Tariffs may lead to reduced consumption in the U.S., which could positively impact environmental and sustainability efforts [4] - There is an expectation of shrinkage in the number of units consumed by Americans and a reduction in diversity of options available [5]

Core Viewpoint - The "Artificial Intelligence + Manufacturing" Special Action Implementation Opinion aims to deeply integrate AI technology with the manufacturing industry, promoting innovation and application in both sectors by 2027 [1] Group 1: Key Objectives - By 2027, China aims to achieve secure and reliable supply of key AI technologies, maintaining a leading position in industry scale and empowerment levels [1] - The plan includes the application of 3-5 general large models in manufacturing, the launch of 1,000 high-level industrial intelligent entities, and the creation of 100 high-quality industrial data sets [1] - The initiative seeks to cultivate 2-3 globally influential ecosystem-leading enterprises and a number of specialized small and medium-sized enterprises [1] Group 2: Major Tasks - The implementation outlines seven major tasks including innovation foundation, intelligence upgrade, product breakthroughs, entity cultivation, ecosystem expansion, safety assurance, and international cooperation [1] - Specific measures include enhancing AI computing power, supporting the development of intelligent chips, and creating high-performance algorithm models tailored for manufacturing [2] - The initiative emphasizes the need for deep integration of AI in production processes and encourages leading enterprises to pioneer AI applications [2] Group 3: Product Development - The plan promotes the integration of AI technology in major equipment development such as aircraft and ships, and supports testing of smart connected vehicles [3] - It aims to accelerate the upgrade of smart terminals and foster innovation in AI-enabled products like smartphones and smart home devices [3] - The initiative includes policy support to guide enterprises in differentiated development and prevent excessive competition within the industry [3]

Employment Trends - December saw a sluggish addition of only 50,000 jobs, a slight decrease from the revised figure of 56,000 in November [1][4] - The unemployment rate decreased to 4.4%, marking its first decline since June, down from 4.5% in November [1] Business Hiring Behavior - Businesses appear reluctant to hire despite economic growth, with many companies no longer needing to fill additional positions after aggressive hiring post-pandemic [2] - Factors contributing to this reluctance include uncertainty from shifting tariff policies, elevated inflation, and the impact of artificial intelligence on job roles [2] Sector Performance - The majority of job gains in December were concentrated in the health care sector, which added 38,500 jobs, and the restaurant and hotel industries, which gained 47,000 jobs [5] - Conversely, manufacturing, construction, and retail sectors experienced job losses, with retailers cutting 25,000 positions, indicating weaker holiday hiring compared to previous years [6] Federal Reserve Response - Weak employment figures have raised concerns at the Federal Reserve, which cut its key interest rate three times last year [3] - Some Federal Reserve officials are worried about persistent inflation above the 2% target, while others advocate for lower borrowing costs to stimulate hiring and economic growth [3]

Core Viewpoint - Gates Industrial Corporation plc (GTES) is positioned as a global manufacturer in power transmission and fluid power solutions, serving various industries including automotive, construction, and agriculture [1] Stock Performance - Over the past 30 days, GTES has experienced a modest gain of 1.11%, indicating positive momentum, although there has been a slight decline of 1.85% in the last 10 days, which may present a buying opportunity for investors [2][5] Growth Potential - GTES has a significant growth potential of 30.39%, with a target price set at $28.40, making it an attractive option for growth-oriented investors [3][5] Financial Health - The company demonstrates strong financial health with a Piotroski Score of 8, indicating robust fundamentals and efficient operations, which positions GTES as a stable investment choice [4][5]

Group 1 - The core objective of Yinchuan City is to achieve high-quality development by 2026, focusing on the "project-oriented" approach with a total of 1,236 projects planned, amounting to a total investment of 351.5 billion RMB, and an annual planned investment of 103.76 billion RMB [1] - The projects are categorized into four main sectors: industry, infrastructure, social welfare, and real estate, with industry projects numbering 407 and an annual planned investment of 46.76 billion RMB, accounting for 45% of the total annual investment [1] - Infrastructure projects total 519, with an annual planned investment of 27.78 billion RMB, representing 27% of the total annual investment [1] Group 2 - The social welfare sector includes 230 projects with an annual planned investment of 12.04 billion RMB, while real estate projects consist of 80 projects with an annual planned investment of 17.18 billion RMB [1] - Among the projects, 256 have total investments exceeding 100 million RMB, with an annual planned investment of 76.78 billion RMB, which constitutes 74% of the total annual investment [2] - To ensure the smooth progress of these projects, Yinchuan City will utilize the "two debts and one fund" leverage effect, focusing on key projects like urban underground pipelines and village renovations, while prioritizing funding and expediting project approvals [2]

Core Viewpoint - The U.S. Supreme Court is expected to make a ruling on tariffs imposed by President Trump, which could significantly impact various stocks and sectors in early 2026 [1][2]. Tariff Legality and Implications - The tariffs were imposed under the International Emergency Economic Powers Act (IEEPA), which has not been used historically for such purposes, raising questions about their legality [4][5]. - A ruling against the tariffs could lead to uncertainties regarding the repayment of tariffs collected from countries, companies, and consumers [6][12]. Market Predictions - Prediction markets indicate a 72% chance that the Supreme Court will rule against Trump's tariffs, with the odds of a favorable ruling for Trump declining from 48% in November to 28% [8][9]. - The most popular prediction for the number of justices voting in favor of the tariffs is three, with a 42% likelihood [10]. Affected Companies and Sectors - Companies like Costco Wholesale and Nike Inc. are highlighted as potentially impacted by the ruling, with Costco seeking repayment and Nike having suffered due to tariffs [12][13]. - The construction and industrial sectors, along with companies like Toyota and 3M, are noted as being significantly affected by the tariffs [14][15]. - Other companies that have filed lawsuits over tariffs include subsidiaries of Revlon and Del Monte Fresh Produce, indicating a broader impact across various industries [13].

Group 1 - Private sector added 41,000 jobs in December, below economists' estimates of 47,000 jobs [1] - Previous month's payrolls revised to a loss of 29,000 from an initial loss of 32,000 [1] - Small establishments showed positive hiring at year-end, while large employers reduced hiring [1] Group 2 - Education and health services led job creation with 39,000 positions added in December [2] - Leisure and hospitality added 24,000 positions, while trade, transportation, and utilities added 11,000 [2] - Professional and business services lost 29,000 jobs, with information and manufacturing losing 12,000 and 5,000 positions respectively [2] Group 3 - Large businesses (500 or more employees) added 2,000 jobs, while businesses with 50 to 499 employees added 34,000 [3] - Establishments with fewer than 50 employees added 9,000 jobs [3] - Wage growth remained stable, with pay for those staying in their roles increasing by 4.4% year-over-year [3]

Group 1 - The Greenbrier Companies, Inc. is set to release its first-quarter earnings results on January 8, 2025, with analysts expecting earnings of 79 cents per share, a decrease from $1.72 per share in the same period last year [1] - The consensus estimate for Greenbrier's quarterly revenue is $655.53 million, which is a decline from $875.9 million a year earlier [1] - On October 28, Greenbrier reported mixed fourth-quarter financial results and provided FY26 sales guidance that fell below estimates [2] Group 2 - Following the mixed financial results, Greenbrier shares increased by 4.3%, closing at $49.09 [2] - Analyst Bascome Majors from Susquehanna maintained a Positive rating on Greenbrier but reduced the price target from $57 to $52 [3] - Analyst Ken Hoexter from B of A Securities maintained an Underperform rating while raising the price target from $60 to $62 [3]

7 January 2026 | 8:48AM JST Equity Research +81(3)4587-9806 | yuichiro.isayama@gs.com Goldman Sachs Japan Co., Ltd. Takeru Adachi +81(3)4587-4067 | takeru.adachi@gs.com Goldman Sachs Japan Co., Ltd. Takato Enoki +81(3)4587-1739 | takato.enoki@gs.com Goldman Sachs Japan Co., Ltd. Japan Industrials: China tightens controls on export of dual-use items to Japan, media reports on risk of de facto restrictions on rare earth What happened On the evening of January 6 Japan time, China's Ministry of Commerce announc ...

Company Overview - IDEX Corporation (IEX) is a global leader in applied solutions, engineering and manufacturing critical components for essential industrial functions, with a market capitalization of approximately $13.4 billion [1] Earnings Expectations - The upcoming fiscal 2025 fourth-quarter earnings release is scheduled for February 3, with Wall Street expecting diluted EPS of $2.04, unchanged from the previous year [2] - Analysts project fiscal 2025 diluted EPS to remain at $7.89, with a forecasted increase of 5.3% for fiscal year 2026, raising EPS to $8.31 [2] Stock Performance - IEX stock has underperformed compared to broader benchmarks, declining 12.7% over the past 52 weeks, while showing a slight increase of 1.6% year-to-date [3] - In contrast, the S&P 500 Index rose by 16.2% over the same period, and the State Street Industrial Select Sector SPDR ETF (XLI) increased by 20.4% in the last year [3] Recent Financial Results - IDEX reported a significant positive catalyst on October 29, 2025, with a 3.9% intraday stock jump following its fiscal Q3 2025 earnings release [4] - Revenue for the quarter increased by 10.1% year-over-year to $878.7 million, surpassing analyst estimates of $861.1 million [4] - Adjusted EPS rose by 6.8% from the previous year to $2.03, exceeding expectations of $1.93 [4] Management Insights - Management attributed the strong performance to momentum in Health & Science Technologies and solid demand from data centers, municipal water projects, and pharmaceutical customers [5] - CEO Eric Ashleman highlighted the "8020 philosophy," which has sharpened operational focus, accelerated acquisition integration, and enhanced contributions from material science and intelligent water platforms [5]