Group 1: Report Summary Report Industry Investment Rating - Not provided in the document Report's Core View - In September 2025, China's manufacturing PMI was 49.8%, up 0.4 percentage points from the previous month, indicating continued improvement in manufacturing sentiment; the non - manufacturing business activity index was 50.0%, down 0.3 percentage points from the previous month, with overall stable non - manufacturing business volume; the composite PMI output index was 50.6%, up 0.1 percentage points from the previous month, showing continued acceleration of overall expansion in Chinese enterprises' production and business activities [2][3] Summary by Category Manufacturing PMI - Overall: The manufacturing PMI in September was 49.8%, up 0.4 percentage points from the previous month. Large - scale enterprises had a PMI of 51.0%, up 0.2 percentage points; medium - scale enterprises had a PMI of 48.8%, down 0.1 percentage points; small - scale enterprises had a PMI of 48.2%, up 1.6 percentage points [2] - Classification Index: Among the 5 classification indexes, the production index and supplier delivery time index were above the critical point, while the new order index, raw material inventory index, and employment index were below the critical point. The production index was 51.9%, up 1.1 percentage points; the new order index was 49.7%, up 0.2 percentage points; the raw material inventory index was 48.5%, up 0.5 percentage points; the employment index was 48.5%, up 0.6 percentage points; the supplier delivery time index was 50.8%, up 0.3 percentage points [2] Non - manufacturing PMI - Overall: The non - manufacturing business activity index in September was 50.0%, down 0.3 percentage points from the previous month. The construction business activity index was 49.3%, up 0.2 percentage points; the service business activity index was 50.1%, down 0.4 percentage points [3] - Industry Details: Industries such as postal, telecommunications, radio, television, and satellite transmission services, and monetary and financial services were in a high - level boom range above 60.0%, while industries such as catering, real estate, and culture, sports, and entertainment were below the critical point [3] Composite PMI Output Index - In September, it was 50.6%, up 0.1 percentage points from the previous month, indicating continued acceleration of overall expansion in Chinese enterprises' production and business activities [3]

Core Insights - The World Bank predicts that India will remain the fastest-growing major economy globally, driven by strong consumption growth, increased agricultural output, and rising rural wages [1][3] - South Asia's economic growth is expected to slow down significantly, with a forecast of 5.8% for 2026, marking the lowest growth rate in 25 years [1][4] - The report emphasizes the need for trade liberalization and technology adoption to create job opportunities and stimulate growth in the region [1][6] Economic Growth Projections - South Asia's GDP growth is projected at 6.4% for 2024, 6.6% for 2025, and 5.8% for 2026, with a downward revision of 0.6 percentage points for 2026 [2] - India is forecasted to grow at 9.2% in 2024, 6.5% in 2025, and 6.5% in 2026, with a slight upward revision of 0.2 percentage points for 2025 [2] - Bangladesh's growth is expected to accelerate to 4.8% in 2025/26 and 6.3% in 2026/27, while Sri Lanka's growth forecast for 2026 has been raised to 3.5% [3][4] Impact of U.S. Tariffs - The report discusses the impact of U.S. tariffs on South Asian economies, with India facing a 50% tariff, Bangladesh and Sri Lanka facing 20%, and Nepal, Bhutan, and Maldives facing 10% [3][4] - The tariffs have resulted in significant increases in the effective tax rates on exports, with Bangladesh's exports facing a total of 35% tariffs and Sri Lanka's at 30% [3] Trade and Investment Recommendations - The World Bank suggests that South Asian countries should lower trade barriers, particularly on intermediate goods, to enhance manufacturing and job creation [4][5] - The report highlights that the service sector, which has lower tariffs, has contributed to three-quarters of job growth in the past decade [5] Artificial Intelligence Potential - The report advocates for leveraging AI to boost productivity and income, noting that demand for AI skills is rapidly increasing, with a wage premium of nearly 30% compared to other professions [6] - It emphasizes that trade openness and AI application could transform the South Asian region, necessitating policies that facilitate labor reallocation to productive sectors [6]

Core Insights - The 2025 Trilateral Economic Report highlights the resilience and opportunities of the East Asian economic circle amid global uncertainties, emphasizing the importance of trilateral cooperation among China, Japan, and South Korea [1][6]. Economic Scale and Trade - In 2024, the combined GDP of China, Japan, and South Korea reached USD 24.21 trillion, a 2.7% increase from 2023, accounting for over 24% of global GDP [2][40]. - The total population of these three countries is approximately 1.584 billion, representing nearly 20% of the global population, making it one of the most promising consumer markets [2][40]. - The goods trade volume among the three countries is estimated at USD 8.93 trillion in 2024, which is 18.8% of global trade, highlighting their role as stabilizers in global supply chains [2][40]. Demographic Challenges - The aging population is a significant challenge, with Japan having 30% of its population aged 65 and older, South Korea at 18%, and China nearing 14%, all exceeding the global average of 10% [3]. - Fertility rates are critically low, with South Korea at 0.7, Japan at 1.2, and China at 1.0, indicating potential long-term population decline [3]. Economic Outlook - The report predicts that the economic growth rate for the ASEAN+3 region may fall below 4% in 2025 due to global trade shocks, with growth for China, Japan, and South Korea expected to decrease from 4.1% in 2024 to 3.7% [3][40]. - Long-term projections suggest that potential economic growth for ASEAN+3 and the CJK economies could decline to 2.8% and 3.0% by 2050, respectively [3][40]. Regional Economic Integration - The Regional Comprehensive Economic Partnership (RCEP) has shown positive impacts on trade and investment, with the trade volume reaching USD 13 trillion in 2023, accounting for 30% of global exports [4]. - However, challenges remain, such as small and micro enterprises struggling to benefit from RCEP, and the need for improved customs facilitation [4]. Semiconductor Industry Collaboration - The semiconductor industry is highlighted as a critical area for trilateral cooperation, with South Korea leading in memory chips, Japan dominating in manufacturing equipment, and China rapidly advancing [5]. - Recommendations include establishing a trilateral semiconductor supply chain dialogue platform and joint research initiatives to enhance regional supply chain resilience [5]. Future Cooperation Directions - The report emphasizes the need for accelerated negotiations on the China-Japan-Korea Free Trade Agreement (CJKFTA) and collaboration in emerging sectors like electric vehicles and renewable energy [5]. - Strengthening regional cooperation is deemed essential to navigate uncertainties and promote sustainable growth across the region [6].

Economic Overview - Pre-market futures are mostly positive, but show signs of decline shortly before market opening due to the ongoing federal government shutdown, which has resulted in a lack of economic data, including the crucial Employment Situation report from the U.S. Bureau of Labor Statistics (BLS) [1] - The Dow is up by 44 points, the S&P 500 by 1.5 points, and the Nasdaq by 0.25 points, with the small-cap Russell 2000 also showing a gain of 6 points. All indexes are in the green for the trading week, with mid-single digits for the month and double-digit increases year to date, except for the Dow, which is up by 9% [2] Labor Market Insights - The government shutdown is impacting the availability of labor market data at a critical time, as there has been a rapid deceleration in non-farm payrolls over the past year. The absence of today's numbers leaves uncertainty regarding whether the labor market is stabilizing or continuing to decline [3] - The trailing four-month average for new jobs filled is +27K, significantly lower than the previous averages of +123K and +222K, raising questions about the future direction of the labor market [4] - The Unemployment Rate is expected to remain at a relatively benign 4.3%, but this figure does not fully capture the impact of retiring Baby Boomers and young individuals entering the workforce without meaningful employment, which skews the unemployment statistics [5][6] Market Expectations - Private-sector data remains unaffected by the shutdown, with expectations for the S&P final Services PMI and ISM Services for September to align with prior-month figures, indicating growth as both are above the 50-threshold [7] - The upcoming Q3 earnings season will coincide with the release of the Consumer Price Index (CPI) and Producer Price Index (PPI) for September, complicating the Federal Reserve's decision-making regarding interest rate cuts at their next monetary policy meeting [8]

Core Insights - The U.S. growth has significantly slowed down, raising concerns about the economy's health as it approaches the final quarter of the year [1] - The Institute for Supply Management's services index dropped to a reading of 50 in September, marking the first time it has reached this threshold since 2010, indicating a potential shift from growth to contraction [1] - The ISM's business activity index fell to 49.9, representing the first contraction since May 2020, further highlighting the weakening economic conditions [1]

Group 1 - The UK service sector activity significantly slowed down in September, with the Purchasing Managers' Index (PMI) dropping from 54.2 in August to 50.8, marking the lowest level in five months and nearing the threshold of economic contraction [1] - The slowdown is attributed to persistent high inflation and uncertainty regarding future policies, leading businesses and households to adopt a more cautious spending approach [1] - The UK government is facing a tight fiscal situation, with the Chancellor planning to announce the annual budget in late November, raising concerns about balancing fiscal deficit reduction and economic growth [1] Group 2 - Employment in the service sector has been experiencing layoffs for a year, reflecting a lack of confidence among businesses regarding future prospects [1] - The Bank of England faces uncertainty regarding monetary policy direction, with debates on whether to lower interest rates amidst fluctuating inflation rates [2] - The UK economy has been under pressure from high inflation, elevated interest rates, and unresolved trade tensions post-Brexit, indicating that future economic performance will heavily depend on government budget policies and central bank interest rate decisions [2]

Group 1 - In September, U.S. employers announced layoffs of 54,064, a decrease of 37% from August and a 26% drop from the same month last year [1] - Year-to-date layoffs reached 946,426, the highest since the pandemic in 2020, and the fifth highest in the company's 36-year history [1] - Year-to-date layoffs increased by 55% compared to the same period last year and are 24% higher than the total for 2024 [1] Group 2 - The services sector announced the most layoffs in September, totaling 6,290, a significant rise from 1,862 in August and 2,996 in September 2024 [1] - Year-to-date layoffs in the services sector reached 61,590, reflecting a 64% increase year-on-year [1] - The energy sector reported 5,807 layoffs in September, bringing the year-to-date total to 14,811 [1] Group 3 - Major reasons for layoffs include DOGE behavior, market and economic conditions, and technological updates, with 293,753 layoffs attributed to DOGE behavior and 208,227 to market conditions [2] - Employers plan to add 204,939 new positions this year, a 58% decrease compared to the same period in 2024, primarily due to fewer seasonal hiring plans [2] - The number of seasonal hiring plans tracked last month was 100,800, significantly lower than 401,850 at the beginning of October 2024 [2]

Core Viewpoint - The manufacturing PMI reading in September shows a seasonal rebound, indicating a slight improvement in economic conditions compared to August, primarily due to the concentration of production replenishment in September driven by anti-involution effects [1] Manufacturing Sector - The improvement in the manufacturing sector is mainly reflected in production, finished goods inventory, and new export orders [1] - However, there are signs of a slowdown in domestic demand and price indicators, suggesting low consumer acceptance of price increases, with PPI likely to decline on a month-on-month basis [1] - Certain raw material industries and capital goods-related sectors are performing well, but the ex-factory price index in key anti-involution industries has generally fallen below 50 [1] Non-Manufacturing Sector - The non-manufacturing PMI in September shows a widening gap compared to historical levels, primarily due to a decline in the service sector's performance [1] - This decline may be linked to a slight downturn in the employment market and extreme weather events such as typhoons [1] Economic Outlook - Overall, while there is a marginal recovery in manufacturing sentiment in September, there is a decline in service and domestic demand-related indicators [1] - Looking ahead, it is anticipated that incremental policy tools will be implemented in the fourth quarter to support stable economic operations [1]

Group 1 - In September, the Manufacturing Purchasing Managers' Index (PMI) was 49.8%, an increase of 0.4 percentage points from the previous month, indicating a slight acceleration in overall economic output [1] - The Production Index for manufacturing reached 51.9%, up 1.1 percentage points, marking a six-month high, suggesting active manufacturing production [1] - Key industries such as equipment manufacturing, high-tech manufacturing, and consumer goods showed PMIs of 51.9%, 51.6%, and 50.6% respectively, all above the manufacturing average, indicating robust supply and demand [1] Group 2 - The Production and Business Activity Expectation Index for manufacturing was 54.1%, up 0.4 percentage points, reflecting positive market outlook among manufacturers [2] - The Non-Manufacturing Business Activity Index was 50.0%, down 0.3 percentage points, indicating stability in the non-manufacturing sector, while the Service Sector Index remained in the expansion zone at 50.1% [2] - Certain sectors like postal, telecommunications, and financial services maintained high business activity indices above 60.0%, while sectors closely related to consumer spending, such as dining and entertainment, fell below the critical point [2] Group 3 - Overall, September's macroeconomic indicators showed a stable improvement, with multiple positive factors contributing to increased market vitality [3] - Looking ahead to the fourth quarter, macroeconomic policies are expected to be intensified, providing new momentum and confidence to the market [3]

Core Viewpoints - The traditional sectors are experiencing weakened growth, while new momentum shows a significant recovery, necessitating attention to the effects of stable growth policies in key industries [1][7][73]. Manufacturing Sector - In September, the manufacturing PMI improved, with a rise of 0.4 percentage points to 49.8%, aligning with seasonal expectations. The production index reached a six-month high at 51.9%, up 1.1 percentage points from the previous month [1][7][73]. - The new orders index increased by only 0.2 percentage points to 49.7%, indicating a slower recovery compared to previous years. The demand structure continues to show that external demand is outperforming internal demand, with new export orders rising more significantly than domestic orders [1][13][73]. - The purchasing volume index rose by 1.2 percentage points to 51.6%, driven by stronger production, while the price indices for raw materials and factory output remained resilient [1][7][73]. New Momentum Industries - The PMI for new momentum industries, such as equipment manufacturing and high-tech manufacturing, showed significant improvement, with the equipment manufacturing PMI rising 1.1 percentage points to 51.6% and high-tech manufacturing PMI remaining in the expansion zone at 51.9% [2][19][74]. - Conversely, high-energy-consuming industries saw a decline in PMI by 0.7 percentage points to 47.5%, reflecting ongoing weakness in real estate and infrastructure investments [2][19][74]. Non-Manufacturing Sector - The non-manufacturing PMI fell to the critical point of 50%, with the construction PMI slightly recovering by 0.2 percentage points to 49.3%, while the service sector PMI dropped 0.4 percentage points to 50.1% [2][24][74]. - The service sector, particularly industries closely related to consumer travel, such as dining and cultural activities, experienced a significant decline in business activity indices, falling below critical levels [2][24][74]. Future Outlook - Although traditional momentum faces downward pressure on both quantity and price, new momentum is accelerating its support for the economy. Continuous monitoring of the effects of new incremental policies is essential [3][75]. - The upcoming stable growth policies in key industries like construction materials and steel are expected to mitigate the risks associated with the downturn in infrastructure and real estate sectors [3][75].