Core Viewpoint - The article discusses the current market dynamics, highlighting a strong rebound in the stock market and the emergence of "anti-involution" trading strategies in commodities, while also noting a slight tightening in the funding environment [3][6]. Group 1: Market Overview - The stock market experienced a strong rebound, attributed to major institutions realizing profits at the end of the quarter [6]. - The funding environment showed slight tightening, with the central bank conducting a 1,883 billion yuan reverse repurchase operation, while 7,829 billion yuan of reverse repos matured, resulting in a net withdrawal of 5,946 billion yuan [3][4]. - The long-term bond yields saw a slight increase, with the 10-year government bond yield fluctuating around 1.7525% to 1.78% during the day [6][7]. Group 2: Interest Rates and Funding Rates - The funding rates remained stable, with DR001 around 1.32% and DR007 at approximately 1.44% [4]. - The weighted rates for repos showed minimal changes, with R001 at 1.36% and R007 at 1.46%, indicating a slight decrease in transaction volumes [5]. - The overall transaction volume in the repo market was 76,332.53 billion yuan, reflecting a decrease of 3,275.32 billion yuan [5]. Group 3: Commodity Market Dynamics - The commodity market saw a resurgence of "anti-involution" trading, with leading stocks like polysilicon hitting the upper limit, while government bond futures experienced a decline [7]. - The market sentiment regarding the "anti-involution" narrative appears mixed, as evidenced by the fluctuating performance of bond funds, with pure bond funds seeing negative net subscriptions after three days of small net purchases [7].

Core Viewpoint - The bond market is experiencing fluctuations with a general trend of rising yields, while the liquidity remains ample due to central bank operations [1][5][6] Market Performance - The closing prices for government bond futures showed a decline across all maturities, with the 30-year contract down by 0.89% to 116.350, and the 10-year contract down by 0.30% to 107.950 [2] - The yields on major interbank bonds have generally increased, with the 10-year government bond yield rising by 2.15 basis points to 1.775% [2] International Market Trends - In North America, the 10-year U.S. Treasury yield decreased by 5.6 basis points to 4.1607% [3] - In Asia, the 10-year Japanese bond yield fell by 2.5 basis points to 1.58% [3] - In the Eurozone, the 10-year French bond yield dropped by 5 basis points to 3.489% [3] Primary Market Activity - The China Export-Import Bank's 1-year fixed-rate bond had a winning bid rate of 1.2905%, with a total bid-to-cover ratio of 4.04 [4] - The Ministry of Finance's 1-year and 30-year government bonds had weighted average winning yields of 1.3485% and 2.1139%, respectively [4] Liquidity and Funding - The central bank conducted a reverse repurchase operation of 1,883 billion yuan at a rate of 1.40%, resulting in a net liquidity withdrawal of 5,946 billion yuan for the day [5] - The central bank is expected to continue providing liquidity support in line with the bond issuance schedule [6] Institutional Insights - According to CITIC Securities, there is an anticipated issuance of approximately 4 trillion yuan in interest rate bonds, which is lower than the previous year's figure [6] - Shenwan Hongyuan noted that while there is still demand for credit bonds, the pressure on the liability side may limit support for credit bonds in the short term [6] - Guosheng Securities predicts a gradual recovery in the bond market, with expectations of reduced pressure from the stock market on bonds [6]

Market Overview - The China Convertible Bond Index rose by 2.17%, closing at 479.0, with a trading volume of 83.321 billion yuan [1] - A total of 436 convertible bonds were traded, with 423 increasing in value, 0 remaining flat, and 13 declining [1] Top Performing Convertible Bonds - The top five performing convertible bonds included: - Huiche Tui Debt (404004) increased by 28.74% - Xizi Convertible Bond (127052) rose by 16.33% - Qianglian Convertible Bond (123161) gained 14.53% - Zhenhua Convertible Bond increased by 11.97% - Enjie Convertible Bond rose by 10.98% [2][5] Underperforming Convertible Bonds - The five convertible bonds with the largest declines were: - Zhonglu Convertible Bond (123155) decreased by 8.00% - Dayuan Convertible Bond (113664) fell by 4.06% - Dongjie Convertible Bond (123162) dropped by 3.51% - Tianlu Convertible Bond declined by 1.01% - Hengshuai Convertible Bond decreased by 0.89% [3][5] Corresponding Stock Performance - Among the convertible bonds, 391 corresponding stocks rose, 7 remained flat, and 38 declined [1] - Notable stock performances included: - New Qianglian stock increased by 16.62%, corresponding to Qianglian Convertible Bond's 14.53% rise - Yiwai Lithium Energy stock rose by 16.59%, corresponding to Yiwai Convertible Bond's 7.04% increase - Zhonghuan Hailu stock dropped by 20.00%, corresponding to Zhonglu Convertible Bond's 8.00% decline [4][6]

1. Report Title and Period - The report is the 32nd issue of the Weekly Monitoring Report on Local Government Bonds and Urban Investment Industry in 2025, covering the period from August 25th to August 29th, 2025 [1][4] 2. Core Views - The "Opinions on Promoting High - quality Urban Development" proposes to establish a sustainable urban construction and operation investment and financing system, emphasizing the prevention and resolution of local government debt risks and the transformation of urban investment enterprises [6] - Ningxia and Jiangxi are accelerating the withdrawal of financing platforms, with Ningxia achieving a 76% withdrawal rate in 2024 and Jiangxi having 205 platforms exit in the first half of 2025, completing 62.7% of the annual task [6] - The cumulative issuance of special new special - purpose bonds is approaching one trillion yuan, and some funds may be used to clear up arrears to enterprises [5] 3. Summary by Section 3.1. News Review - **Policy Issuance**: The "Opinions on Promoting High - quality Urban Development" proposes to establish a sustainable urban construction and operation investment and financing system, coordinating multiple funding channels and emphasizing the prevention of new local government hidden debts [6] - **Platform Withdrawal**: Ningxia actively promoted the withdrawal of financing platforms in 2024, with a withdrawal rate of 76%, effectively reducing platform debt risks. In the first half of 2025, Jiangxi innovated the replacement bond mechanism, with a debt resolution progress of over 80%, and 205 platforms completed their withdrawal [6] - **Early Redemption**: 28 urban investment enterprises redeemed bond principal and interest in advance this week, involving 29 bonds with a total scale of 59.64 billion yuan [13] - **Cancellation of Issuance**: Two urban investment bonds were cancelled for issuance this week, with a planned total issuance scale of 6.23 billion yuan [14] 3.2. Issuance of Local Government Bonds and Urban Investment Enterprise Bonds - **Local Government Bonds**: The issuance scale decreased by 4.76% to 351.597 billion yuan, the net financing increased by 16.61% to 234.508 billion yuan, the weighted average issuance interest rate decreased by 7.66BP to 2.05%, and the weighted average issuance spread widened by 1.80BP to 22.03BP. The cumulative issuance of special new special - purpose bonds was 967.654 billion yuan [15] - **Urban Investment Bonds**: The issuance amount increased by 6.60% to 112.781 billion yuan, the net financing turned positive, increasing by 386.26 billion yuan to 19.394 billion yuan. The overall issuance interest rate decreased by 1.25BP to 2.32%, and the issuance spread narrowed by 1.11BP to 79.53BP. Five overseas urban investment bonds were issued, with a total scale of 1.936 billion yuan [18][19] 3.3. Trading of Local Government Bonds and Urban Investment Enterprise Bonds - **Funding Situation**: The central bank conducted 2273.1 billion yuan of reverse repurchase and 600 billion yuan of MLF operations, with a net investment of 496.1 billion yuan. Short - term funding rates mostly declined [22] - **Local Government Bonds**: The spot trading volume was 444.324 billion yuan, an increase of 29.06%. Most of the maturity yields increased, with an average increase of 5.60BP [24] - **Urban Investment Bonds**: The trading volume was 285.544 billion yuan, a decrease of 1.38%. Short - term maturity yields decreased, while long - term yields increased. The spreads of 3 - year and 5 - year AA+ urban investment bonds widened, while the 1 - year AA+ spread narrowed [24] - **Abnormal Trading**: Nine urban investment entities had 10 bonds with 13 abnormal trades, with the number of entities, bonds, and abnormal trades all decreasing compared to last week [24] 3.4. Important Announcements of Urban Investment Enterprises - A total of 125 urban investment enterprises announced changes in senior management, legal representatives, directors, supervisors, etc., including 51 announcements of changes in senior management, 10 announcements of changes in controlling shareholders and actual controllers, 4 announcements of equity/asset transfers, 13 announcements of cumulative new borrowings, 1 announcement of name change, 5 announcements of external guarantees, and 1 announcement of business scope change [27]

Group 1: Report Industry Investment Rating - No relevant content provided Group 2: Core Viewpoints of the Report - After the current round of adjustment, credit bonds have certain cost - effectiveness, but the bond market may still be adjusted in the short term, so investors are advised to adopt a defensive strategy. Short - duration bonds have good cost - effectiveness for capital preservation, and for those with yield requirements, short - duration bonds of medium - and low - grade can be further explored, while 3 - year bonds can balance defensive attributes and yield requirements [6] Group 3: Summary According to Relevant Catalogs Current Situation of Credit Bond Spreads - Since August, affected by the capital market and the adjustment of the equity market, credit bonds have shown a volatile market, and credit spreads have continued to widen. The static yield of credit bonds is at a phased high, and the cost - effectiveness of mining income is gradually increasing. However, due to the end - of - quarter factor and the equity market, the bond market is still difficult to stabilize in the short term [1] Yield Changes of Urban Investment Bonds - As of September 4, for 1 - year AAA - rated urban investment bonds, the yield was 1.70%, up about 3.65bp from the previous low, and the 3 - year yield rose from 1.77% to 1.91%, up about 14.33bp. For 1 - year AA - rated bonds, the yield was up about 3.58bp from the previous low, and the 3 - year AA - rated bonds were up about 19.82bp. Short - end credit bond varieties showed better stability during bond market fluctuations [2] Investment Suggestions for Different Institutions - For institutions with stable liability ends, the cost - effectiveness of medium - and long - term credit bonds is relatively significant, and there is a significant riding income around 3 years. The term spreads of 3 - year and 5 - year bonds of each grade are at a high level this year, so relevant assets can be appropriately allocated if the subsequent valuation fluctuation risk can be borne [2] - For valuation - sensitive institutions with unstable liability ends, short - end varieties have sufficient spread protection. It is recommended to maintain a defensive strategy before the right - side signal appears. Short - end varieties still have good cost - effectiveness in terms of defense [3] Spread Protection Analysis - When calculating the maximum spread increase that each implied - rating bond can accept at the break - even point for a 1 - month holding period, the spread protection of 1 - year varieties is significantly higher than that of other terms. Generally, the spread protection increases slightly as the rating decreases [3] - When calculating with the yield of the same - term China Development Bank bonds as the implied minimum yield requirement, the spread protection difference between terms decreases, while the difference between grades increases [6]

Report Industry Investment Rating No relevant content provided. Core Viewpoints - The combined policies of the central and local governments are expected to expand the scope of credit bond issuers and increase the supply of bonds in areas such as urban renewal and urban village renovation. The optimization of the general repurchase mechanism in the inter - bank bond market will improve the market's overall liquidity and the credit bond collateral financing environment, but also bring some risks [4][5]. - Although the allocation value of short - and medium - term credit bonds is emerging, risks such as long project return cycles, uncertain cash flows, and intensified credit stratification need to be vigilant, and the issue of new implicit debts should be prevented [4]. Summary by Relevant Catalogs Market Hotspots - **Central - local cooperation for urban construction financing**: The central government's "Opinions on Promoting High - quality Urban Development" and Shanghai's "Implementation Opinions on Accelerating the Renovation of Urban Villages in the City" are expected to expand the scope of credit bond issuers and increase bond supply in urban construction. However, risks such as long project return cycles, uncertain cash flows, and intensified credit stratification need to be noted, and new implicit debts should be prevented [4][11][12]. - **Optimization of the inter - bank general repurchase mechanism**: On September 1, the general repurchase business mechanism in the national inter - bank bond market was optimized. The scope of participating institutions was expanded, and the range of eligible collateral bonds was extended. This is expected to improve market liquidity and the credit bond collateral financing environment, but may also intensify the internal differentiation of credit bonds and has limited short - term boosting effects on low - quality bonds [5][14][15]. Macroeconomic Data - In August, the official manufacturing PMI rose slightly by 0.1 percentage points to 49.40% compared with the previous month but remained in the contraction range. The manufacturing production index increased by 0.3 percentage points to 50.8%, and the new export order index continued to contract for 12 months. The PMI of small and medium - sized enterprises was still below the boom - bust line [6][18]. Money Market - Last week, the central bank net - withdrew 40.39 billion yuan through open - market operations. The central bank injected liquidity through over - renewal of MLF and increased reverse repurchase. The overall money market was stable across the month. The pledged repurchase rates of each term fluctuated, and the 3 - month and 1 - year Shibor changed little [7][20]. Primary Market of Credit Bonds - The issuance scale of credit bonds last week was 256.145 billion yuan, an increase of 21.105 billion yuan from the previous period. The cancellation scale of credit bond issuance was 4.71 billion yuan, a decrease of 10.745 billion yuan from the previous period. The average issuance cost of credit bonds fluctuated between 2 - 20bp [23][25]. Secondary Market of Credit Bonds - The trading volume of cash bonds in the secondary market last week was 831.0473 billion yuan, and the average daily trading volume decreased by 7.6835 billion yuan from the previous period. The yields of treasury bonds and policy - bank bonds generally declined by 1 - 3bp, while the yield of 10 - year treasury bonds increased by 6bp to 1.84%. The yields of credit bonds showed long - and short - term differentiation, and the credit spreads and rating spreads fluctuated within a limited range [34][38][42].

Group 1 - The total scale of credit bond ETFs is 357.7 billion yuan, with a daily increase of 1.85 billion yuan, including a rise of 0.1 billion yuan for benchmark market-making ETFs and 0.88 billion yuan for sci-tech bond ETFs [1] - The median weighted duration is 3.9 years, indicating a moderate interest rate risk exposure [1] - Overall trading volume reached 111.1 billion yuan, with an average single transaction amount of 5.21 million yuan [1] Group 2 - Institutional investors remain optimistic about the bond market despite significant declines in the stock market, recalling the 2015 bull market and its aftermath [2] - The current expectation for the 10-year government bond yield is between 1.6% and 1.8%, with a target of 1.65% [2] - The central bank's continued easing measures suggest a stable liquidity environment, with potential for reserve requirement ratio cuts and interest rate reductions before the Spring Festival [2] Group 3 - The Ping An Company Bond ETF (511030) has the least trading discount in the past week at 2 basis points and has seen a net inflow of 0.052 billion yuan, contrasting with a net redemption of 0.34 billion yuan for the sci-tech bonds [3] - The Ping An Company Bond ETF has ranked first in controlling drawdown during the current bond market adjustment, indicating strong performance relative to peers [3] - The data shows that the Ping An Company Bond ETF has a scale of 22.405 billion yuan and a trading volume of 12.366 billion yuan in the past week [3]

Report Information - Research Team: Guanyi'an Futures Research Center Macro Team [1] - Report Date: September 5, 2025 [1] Global Asset Market Performance 10 - Year Treasury Yields of Major Economies - On September 4, 2025, yields varied widely across countries, e.g., the US was 4.162%, Japan 3.589%, and China 1.806% [2] - Recent changes showed mixed trends, with some yields rising and others falling over different time - frames (latest, one - week, one - month, one - year) [2] 2 - Year Treasury Yields of Major Economies - Yields on September 4, 2025, such as the US at 3.660%, the UK at 3.944%, and Germany at 1.961% [2] - Changes over different periods also showed a mix of increases and decreases [2] Dollar Exchange Rates Against Major Emerging Economies' Currencies - On September 4, 2025, exchange rates were as follows: Brazil 5.447, South Africa zar 17.779, etc. [2] - Exchange rates had different percentage changes over various time - spans, with some appreciating and others depreciating [2] Performance of Major Economies' Stock Indices - On September 4, 2025, indices like the S&P 500 was 6502.080, the Nikkei was 42580.270, etc. [2] - Indices showed different trends in terms of daily, weekly, monthly, and yearly changes [2] Credit Bond Indices - Different credit bond indices (US investment - grade, Eurozone investment - grade, etc.) had varying percentage changes over different time periods [2][3] Stock Index Futures Trading Data Index Performance - Closing prices on September 4, 2025: A - share was 3765.88, CSI 300 was 4365.21, etc. [4] - All indices had negative percentage changes on that day, e.g., A - share - 1.25%, CSI 300 - 2.12% [4] Valuation - PE (TTM) values and their环比 changes were provided for several indices, such as CSI 300 (13.85, - 0.16) and S&P 500 (27.06, 0.28) [4] Risk Premium - Risk premium values and their环比 changes were given for some indices, e.g., S&P 500 (- 0.47, 0.01) and Germany's DAX (2.38, - 0.01) [4] Fund Flows - Latest and 5 - day average fund flow values were negative for most segments, e.g., A - shares (- 1326.31, - 1317.62) [4] Trading Volume - Latest trading volume and环比 changes were presented for different markets, e.g., Shanghai and Shenzhen stock markets (25442.57, 1801.71) [4] Basis and Spread of Main Contracts - Basis and spread percentages were provided for IF, IH, and IC contracts, e.g., IF (- 15.81, - 0.36%) [4] Treasury Futures Trading Data Futures Closing Prices and Changes - Closing prices on September 4, 2025, for T00 was 108.350, TF00 was 105.815, etc. [5] - All had positive percentage changes, e.g., T00 0.15%, TF00 0.09% [5] Money Market Interest Rates - Interest rates for R001, R007, and SHIBOR - 3M were 1.3577%, 1.4622%, and 1.5500% respectively, with R001 having a - 10.00 BP daily change [5]

Core Viewpoint - The article discusses the unexpected rise in 30-year U.S. Treasury yields despite expectations of interest rate cuts by the Federal Reserve, attributing this phenomenon to seasonal factors, global market influences, and structural anxieties regarding inflation and debt levels [4]. Group 1: Seasonal Factors - September is a peak month for corporate bond issuance in the U.S., leading to a diversion of funds away from Treasury bonds, which results in decreased demand for U.S. government debt [4]. - Traders returning from vacation are busy reallocating their portfolios, contributing to a temporary lack of interest in U.S. Treasuries, which are perceived as "discounted" assets [4]. Group 2: Global Market Influences - European long-term bonds have seen a decline, with the UK’s 30-year government bond yield reaching its highest level since 1998, creating a domino effect that negatively impacts U.S. Treasury yields [4]. Group 3: Structural Anxieties - Rising tariffs are increasing costs, leading companies to pass on these expenses to consumers, which is expected to drive inflation higher in the coming months, as noted in the Beige Book [4]. - Investors are demanding higher yields to hedge against inflation risks, especially with the U.S. planning to issue $1 trillion in new debt in the third quarter, nearly half of which will be long-term bonds, exacerbating concerns about rising debt levels [4]. - In the short term, if the Federal Reserve signals a series of rate cuts, yields may decrease; however, inflation and debt levels are seen as the primary long-term drivers of market behavior [4].

Group 1 - The core point of the article highlights a significant drop in U.S. Treasury yields, particularly the 10-year yield falling by 5.6 basis points to 4.16%, marking the largest decline since disappointing non-farm payroll data in August [1] - The market is anxiously awaiting the upcoming non-farm payroll data, with a 99.4% probability of a Federal Reserve rate cut in September, leading to concerns that poor data might prompt the Fed to act sooner than expected [3] - Recent actions by the U.S. Treasury, including a Q3 refinancing plan that reduced long-term debt issuance by $50 billion, have provided temporary relief to the market, although future debt issuance could increase by $2 trillion due to Trump's fiscal plans [3] Group 2 - Foreign investments are increasing in the U.S. Treasury market, with net inflows of $12.7 billion in August, particularly from China and Japan, indicating that institutional investors see value in the current yield environment [3] - September is expected to be a volatile month for the bond market, with $310 billion in corporate bonds set to be issued, potentially diverting significant capital [4] - The article warns that upcoming changes in tariff policies could elevate inflation expectations, reminiscent of last October's spike in Treasury yields, which caused substantial losses for investors [4]