Group 1: Market Trends - After the tariff announcement on April 2, the US stock market quickly priced in a recessionary regime, eliminating the possibility of a "Goldilocks" (moderate growth) scenario. This trend has since reversed, with the probability of the Goldilocks regime returning to March's average level [1] - The Purchasing Managers' Index (PMIs) continues to decline, while OECD leading indicators show the economy remains in a late cycle but has not yet exited the expansion phase. The REVS regime favors late-cycle defensive sectors like communication services, but as leading indicators weaken, preferences may shift more towards utilities [2] Group 2: Earnings Adjustments - Almost all sectors have seen downward revisions in sales and earnings expectations, but the pace of these adjustments has slowed. The sectors with the largest downward revisions include automotive, durable goods, and building materials. The dispersion in earnings scores indicates the presence of alpha opportunities in the market [3] Group 3: Valuation Insights - Forward price-to-earnings ratios have mostly rebounded, returning to a "growth optimism" range. The US stock market's valuation remains higher than other global regions, with dollar-denominated earnings outperforming Europe by 10%, exceeding long-term trends [4] Group 4: Sentiment Analysis - Utilities and consumer staples sectors maintain positive sentiment. UBS crowding data indicates a persistent overweight position in the US market, although it has decreased from March's peak. The significant rotation from cyclical consumer stocks (durable goods and automotive) to defensive sectors (like consumer staples) has not fully normalized [5] Group 5: Top and Bottom Rated Stocks - The highest-rated stocks based on the REVS framework include Intercontinental Exchange, Virtu Financial, and Broadcom, with price changes since March 31 ranging from 10.9% to 37.3% [6] - The lowest-rated stocks include Ziprecruiter, Bioxcel Therapeutics, and Jetblue Airways, with price changes since March 31 ranging from 0% to 3.6% [7]

Core Viewpoint - Chinese enterprises have significantly risen on the international stage, showcasing impressive growth and transformation, becoming key players in the global economy and reshaping international trade, investment, and innovation patterns [1][3]. Group 1: Hard Power of Chinese Enterprises - In the 1995 Fortune Global 500 list, the United States had 151 companies, while Japan had 149. By 2024, the U.S. has 139 companies, and China has 128, spanning various industries such as construction, oil, insurance, banking, and technology [3]. - Among approximately 10,500 companies with revenues exceeding $1 billion globally, 25% are from China, surpassing the 19% from the U.S., indicating a greater number of large enterprises in China [3]. Group 2: Global Presence and Investment Trends - About 70% of large Chinese enterprises have subsidiaries in the U.S., over 60% in Germany, around 40% in the U.K. and the Netherlands, and at least 30% in Canada, Brazil, and Italy. Chinese enterprises are also expanding in Africa [4]. - In 2023, Chinese enterprises shifted their greenfield investments from developed economies to Asia and other emerging markets, reflecting a strategic response to changes in the global economic and political landscape [4]. Group 3: Soft Power of Chinese Brands - Historically, U.S. brands dominated the Brand Finance Global 500 list, accounting for about 40%. However, the share of Chinese brands increased from 4% in 2010 to an expected 14% by 2025 [5]. - Chinese brands have gained global recognition in sectors such as e-commerce, media and entertainment, telecommunications, and electric vehicles, altering perceptions of Chinese products beyond the traditional "Made in China" label [5]. - Despite global economic fragmentation, Chinese enterprises are optimizing their overseas strategies and focusing on the vast domestic market, with potential for further enhancement of their soft power [5].

Investment Rating - The report maintains a neutral investment rating for the U.S. stock market [1] Core Insights - The U.S. stock market is experiencing a steady recovery, led by the technology sector, with the S&P 500 rising by 5.3% and the Nasdaq increasing by 7.2% [3] - Significant capital inflows have been observed, particularly in the semiconductor and automotive sectors, indicating strong investor interest [4] - Earnings expectations for the S&P 500 constituents have been slightly adjusted upwards, with traditional industries showing the most significant upward revisions [5] Summary by Sections Price Trends - The S&P 500 increased by 5.3% and the Nasdaq by 7.2% this week, with the automotive and semiconductor sectors leading the gains at +16.2% and +13.3% respectively [3] Capital Flows - Estimated capital inflows for the S&P 500 constituents reached +$25.71 billion this week, a significant increase from the previous week's +$2.99 billion [4] - The semiconductor sector saw the highest inflow at +$9.17 billion, followed by automotive at +$6.59 billion [18] Earnings Forecasts - The dynamic F12M EPS expectations for the S&P 500 were adjusted up by 0.1%, with 19 sectors seeing upward revisions, particularly real estate (+0.7%) and materials (+0.5%) [5]