Core Viewpoint - Ant Group has denied recent media reports about plans to introduce Circle's stablecoin USDC on its blockchain platform, stating that there are currently no such plans in place [2]. Group 1: Ant Group's Position and Plans - Ant Group International clarified that the media reports regarding collaboration with Circle Internet Group are inaccurate and confirmed that there are no plans to adopt USDC at this time [2]. - Following the passage of the Stablecoin Bill by the Hong Kong Legislative Council, Ant Group International plans to apply for a stablecoin issuance license from the Hong Kong Monetary Authority as soon as the bill takes effect on August 1 [2]. - The company is accelerating investments in global financial management and expanding collaborations, focusing on the application of AI, blockchain, and stablecoin innovations [2]. Group 2: Strategic Partnerships and Initiatives - On June 8, Ant Group International signed a strategic cooperation memorandum with Deutsche Bank in Munich, marking a new phase in their partnership established in 2019, aimed at providing comprehensive payment solutions for businesses in Europe and Asia [2]. - On July 4, Ant Group International, in collaboration with the International Swaps and Derivatives Association (ISDA), released a white paper on the application of tokenized deposits in transaction banking, promoting the development of tokenized deposits and shared ledgers in cross-border payments and foreign exchange settlements [3]. - The collaboration with ISDA is part of the "Project Guardian" initiative supported by the Monetary Authority of Singapore, with participation from major financial institutions including Bank of New York Mellon and HSBC [3].

Group 1 - The core event was the awarding ceremony of the 2025 China Awards by The Asian Banker, held in Beijing, which is considered the "Oscar" of the Asia-Pacific financial sector [1][3] - Lianlian International, a subsidiary of Lianlian Digital listed on the Hong Kong Stock Exchange, won the award for "Best Cross-Border Payment and B2B Services for SMEs in China" due to its outstanding performance in the cross-border payment sector [1][3] - The evaluation process for the awards was rigorous, lasting four months, involving detailed assessments and benchmarking against peers, covering six major areas including retail banking and transaction banking, which adds to the awards' authority and credibility [3] Group 2 - Lianlian International's success is attributed to its core advantages in security compliance, technological ecosystem, and localized services, which have been recognized by the industry in the field of cross-border payments for SMEs and B2B services [3] - The company has built compliance barriers through global payment licenses and supports global transactions via its self-developed technology platform, achieving deep cross-border reach through localized layouts [3] - Following this award, Lianlian International aims to continuously promote the iteration and innovation of its technology, products, and services, contributing to the development of the cross-border payment industry amidst the global digital economy wave driven by technologies like 5G and AI [3]

Core Insights - The report indicates a "relatively hot" market sentiment with a composite score of 66, suggesting a positive outlook for market performance [5][12] - Recent policy support and improved market sentiment are driving a gradual upward trend in the market [12] Hot Topics Tracking - **Data Theme**: The National Data Bureau and the State Administration for Market Regulation have introduced measures to enhance data circulation efficiency, potentially increasing efficiency by 30% [6] - **Cross-Border Payment Theme**: The People's Bank of China has released a draft for the rules governing the Renminbi cross-border payment system, aiming to simplify participation conditions for foreign institutions [6] - **Innovative Drug Theme**: The National Healthcare Security Administration and the National Health Commission have issued measures to support the high-quality development of innovative drugs, emphasizing the use of medical insurance data in drug research [6] Market Sentiment Analysis - The market sentiment temperature indicator shows a trend where scores below 30 provide support for the market, while scores above 90 indicate resistance [12] - The report suggests that during "relatively hot" market conditions, investors may consider increasing their investments while remaining cautious of potential overheating risks [24] Major Capital Flows - The report lists significant net inflows for various stocks, with "跨境通" (Cross-Border Communication) leading at 85,258.43 million [13] - Conversely, notable net outflows were observed in "中油资本" (China Oil Capital) with -76,258.27 million, indicating investor caution in certain sectors [15] Industry Performance - The report highlights the performance of various industries, with significant net inflows observed in sectors such as non-ferrous metals and electronics, while industries like pharmaceuticals and defense showed substantial net outflows [20][21]

Investment Rating - The report assigns an "Outperform" rating for the industry, indicating an expected relative return exceeding the benchmark by over 10% in the next 12-18 months [4][21]. Core Insights - The People's Bank of China has revised the CIPS system rules to enhance the framework for cross-border RMB payments, aiming to facilitate the integration of payment channels and improve clearing efficiency [7][4]. - The updated rules expand the scope of CIPS operations to include additional activities approved by the central bank, thereby supporting the growth and functionality of the CIPS system [7][4]. - The Cross-border Pay Link, launched in Hong Kong, allows for real-time, cost-effective remittances between Mainland China and Hong Kong, significantly improving the efficiency of cross-border transactions [7][4]. Summary by Sections CIPS System Rule Updates - The People's Bank of China released a draft for public comment on the CIPS system rules, focusing on account management, business processing, settlement mechanisms, and risk management [4][7]. - The revisions aim to adapt the rules established in 2018 to current business developments and participant needs, enhancing management standards for CIPS participants [4][7]. Cross-border Payment Innovations - The Cross-border Pay Link, which became operational on June 22, connects the fast payment systems of Mainland China and Hong Kong, allowing residents to conduct cross-border remittances efficiently [4][7]. - This system reduces the remittance process time and costs by minimizing intermediary steps and directly connecting payment infrastructures [4][7]. Investment Recommendations - The report suggests focusing on cross-border payment service providers such as Newland Digital Technology, Xgd Inc, Lakala Payment, and Yeahka Limited, as well as financial IT service providers like Yusys Technologies and Sinodata [7][4].

Group 1 - The cross-border payment sector saw a significant increase in stock prices, with Xinya Da (600571) hitting the daily limit up, indicating strong market interest [1] - Zhongyi Technology (301208) experienced a rise of over 8%, reflecting positive investor sentiment in the sector [1] - Other companies such as Zhongyou Capital (000617), Changliang Technology (300348), and Qiming Star (002439) also showed upward movement, suggesting a broader trend in the cross-border payment industry [1]

Core Insights - The report indicates that the current market sentiment is at a high level, with a score of 88, categorizing it as "overheated" [6][10][22] - Recent policy support and improved market sentiment have contributed to a bullish trend in the market [10] Market Themes Tracking - **Data Theme**: The National Data Bureau and the State Administration for Market Regulation have introduced measures to enhance data circulation efficiency, potentially increasing efficiency by 30% [7] - **Cross-Border Payment Theme**: The People's Bank of China has released a draft for the rules governing the Renminbi cross-border payment system, aiming to simplify participation conditions for foreign institutions [7] - **Innovative Drug Theme**: The National Healthcare Security Administration and the National Health Commission have issued measures to support the high-quality development of innovative drugs, emphasizing the use of medical insurance data for drug research [7] Major Capital Inflows - The report lists the top ten stocks with significant net inflows, including Zhongyou Capital (90.12 million), Pengding Holdings (64.11 million), and others [11][12] Major Capital Outflows - The report also highlights the top ten stocks with significant net outflows, such as Changshan Pharmaceutical (-83.03 million) and Jinyi Culture (-79.62 million) [13][23] Financing and Margin Trading - The report provides insights into financing net purchases and margin trading, indicating investor sentiment towards specific stocks and sectors [23]

Core Viewpoint - The recent policy announcements from the Chinese government signify a significant shift towards institutional openness in the financial sector, particularly through the promotion of measures in free trade zones that align with international high-standard economic and trade rules [2][22]. Group 1: Key Measures in Service Trade - Eight critical measures in the service trade sector have been identified, with six of them involving the People's Bank of China and the financial regulatory authority [4][5]. - The measures focus on financial technology, cross-border payments, data compliance, and optimization of financial infrastructure, indicating a direction towards rule-based, interconnected, and risk-controlled service trade [5][15]. - The first measure emphasizes the development of financial technology and international cooperation to facilitate cross-border asset management and the orderly promotion of digital RMB trials in trade scenarios [5][6]. Group 2: Cross-Border Financial Operations - The second measure optimizes the management policies for cross-border capital operations of multinational companies, encouraging them to establish global or regional capital management centers in qualified free trade zones [8][9]. - The third measure aims to enhance the functionality of free trade accounts in qualified free trade zones, simplifying account structures and improving the efficiency of cross-border capital flows [10][11]. - The fourth measure explores cross-border transfer of asset-backed securities and financing lease assets in qualified free trade zones, with a focus on RMB settlement [10][11]. Group 3: Electronic Payment and Data Management - The fifth measure encourages financial institutions and payment service providers to adopt internationally advanced standards for electronic payment systems and to develop cross-border digital identity verification [12][13]. - The sixth measure allows financial institutions to transmit necessary operational data abroad under a national framework for cross-border data transmission security management [14][15]. - These measures collectively create a systematic arrangement for foreign institutions, domestic fintech companies, and multinational companies in account management and payment scenarios, serving as a pilot for institutional openness and a guide for reshaping cross-border financial order [15][20]. Group 4: Coordination of Policies - The draft business rules for the RMB cross-border payment system (CIPS) represent an upgrade in operational standards, while the recent notification lays out a broad path for institutional openness [17][20]. - The alignment between the business rules and the notification indicates a new phase for China's cross-border financial infrastructure, with a focus on standardization and execution [18][20]. - The dual role of free trade zones as both global rule adapters and domestic institutional providers is emphasized, highlighting the importance of proactive engagement with international high-standard economic rules [21][22].

Market Performance - The Shanghai Composite Index closed at 3473.13, with a slight increase of 0.02% [2] - The Shenzhen Component Index closed at 10435.51, down by 0.70% [2] - The CSI 300 Index closed at 3965.17, decreasing by 0.43% [2] - The ChiNext Index closed at 2130.19, down by 1.21% [2] - The STAR 50 Index closed at 978.29, with a decline of 0.66% [2] - The Beijing Stock Exchange 50 Index closed at 1401.92, down by 0.93% [2] Sector Performance - The top-performing sectors included Comprehensive (+2.57%), Utilities (+1.87%), Real Estate (+1.68%), Light Industry Manufacturing (+1.52%), and Environmental Protection (+1.10%) [3] - The worst-performing sectors were Coal (-2.04%), Pharmaceutical Biology (-0.97%), Communication (-0.77%), Home Appliances (-0.70%), and Electronics (-0.67%) [3] Concept Index Performance - The leading concept indices were Shipbuilding System (+5.23%), Biomass Power Generation (+2.83%), Virtual Power Plant (+2.62%), Cross-Border Payment (+2.36%), and Pumped Storage (+2.26%) [3] - The lagging concept indices included Recombinant Protein (-1.42%), Weight Loss Drugs (-1.10%), CRO Concept (-1.07%), AI PC (-1.02%), and AI Mobile Phones (-0.99%) [3] Market Outlook - The market experienced fluctuations with the Shanghai Composite Index managing to close slightly positive while the Shenzhen Component and ChiNext indices closed lower [5] - The report suggests that as the mid-year earnings forecasts and reports are released, the impact of earnings on individual stock performance will become significant [5] - Attention is expected to shift towards domestic policies, US-China tariffs, and potential interest rate cuts by the Federal Reserve, with the upcoming Political Bureau meeting being a key observation point [5] - Recommended sectors for attention include Non-ferrous Metals, Banking, Transportation, and Utilities [5]

Core Viewpoint - The Hong Kong government plans to issue stablecoin licenses within this year, aiming to enhance the regulatory framework for virtual assets and facilitate cross-border payments [1][4]. Group 1: Stablecoin Licensing - The Hong Kong Monetary Authority (HKMA) is consulting the market on the guidelines for the stablecoin regulation, which will include anti-money laundering and other related requirements [4]. - The number of stablecoin licenses issued is expected to be in single digits, with at least nine institutions expressing interest in applying for licenses, including three that are part of the HKMA's stablecoin issuance sandbox [5]. Group 2: Market Reaction - Following the announcement, stocks related to cross-border payments and stablecoins surged in both A-share and Hong Kong markets, with several stocks hitting their daily limit [2][7]. - In the A-share market, companies like Zhongyi Technology and Huafeng Superfiber saw significant gains, while in the Hong Kong market, firms such as Cathay Financial and Hong Kong Securities experienced substantial increases in stock prices [7][9]. Group 3: Cross-Border Payment Context - The stablecoin is expected to address challenges in cross-border payments, particularly in regions with high local currency risk or underdeveloped financial systems [4][5]. - The HKMA aims to promote stablecoins as effective payment tools to reduce transaction costs and facilitate cross-border transactions [4]. Group 4: Regulatory Developments - The Stablecoin Regulation is set to take effect on August 1, 2023, with the HKMA beginning to accept license applications [5]. - The recent approval of the Stablecoin Regulation by the Legislative Council marks a significant step in establishing a licensing system for stablecoin issuers in Hong Kong [5].

Core Viewpoint - The article discusses the ongoing competition for stablecoin licenses in Hong Kong, highlighting the limited availability of these licenses and the intense interest from major financial institutions and tech companies. It emphasizes that while stablecoins are expected to enhance cross-border payment efficiency, their actual impact may be overstated, as they fundamentally extend the functions of fiat currencies rather than disrupt the existing monetary system [1][6]. Group 1: Stablecoin License Competition - The stablecoin license in Hong Kong is scarce and highly sought after, with only a few licenses expected to be granted despite over 40 companies preparing applications [1][2]. - Major players in the market include JD.com, Standard Chartered, and Circle, while many smaller firms face challenges in qualifying for applications [2][3]. - The competition is primarily among China's largest financial institutions and internet companies, indicating a significant interest in stablecoin operations [2][3]. Group 2: Market Expectations and Realities - There is a growing expectation that stablecoins could reconstruct the global monetary system, but experts caution that this view is exaggerated [6]. - Stablecoins are anchored to sovereign currencies and serve as an extension of fiat currency functions, lacking the ability to disrupt the existing financial framework [6][7]. - Research indicates that the actual cost of cross-border payments using stablecoins may approach 1%, contrary to the low-cost narrative often promoted [6][7]. Group 3: Industry Dynamics and Challenges - Companies exploring stablecoin applications fall into two main categories: those involved in cross-border payments and those focused on issuing and circulating stablecoins [3][5]. - Traditional payment institutions face challenges in adapting to blockchain technology and require "chain abstraction" to lower the barriers for using stablecoin products [4][5]. - The stablecoin business demands interdisciplinary collaboration, necessitating knowledge in finance, technology, and crypto assets [5]. Group 4: Future of Stablecoins - The potential for offshore RMB stablecoins is being discussed, with a focus on leveraging Hong Kong as a testing ground for international financial systems [8]. - The development of a RMB stablecoin could enhance cross-border payment capabilities and support the internationalization of the RMB [8]. - A pragmatic approach is needed to balance the development of stablecoins with actual market demands and avoid overextending beyond current capabilities [8].