Investment Rating - The report maintains an "Overweight" rating for the industry, with a focus on new consumption sectors such as beauty care, IP derivatives, and gold jewelry [6][29]. Core Insights - The October CPI performance exceeded expectations, with a year-on-year increase of 0.2%, higher than the consensus forecast of -0.04%. The core CPI, excluding food and energy, rose by 1.2%, marking the highest increase since March 2024 [4][24]. - The implementation of the new duty-free policy in Hainan has led to a surge in tourism consumption, with duty-free shopping amounting to 506 million yuan from November 1 to 7, representing a year-on-year growth of 34.86% [5][27]. - Key events in the beauty care sector include Kimberly-Clark's acquisition of Kenvue, expected to complete in the second half of 2026, and Amorepacific's Q3 operating profit increasing by 41% [4][24]. Summary by Sections Market Performance - For the week of November 3 to November 7, the retail trade, social services, and beauty care sectors saw changes of +0.31%, +0.11%, and -3.10% respectively, ranking 17th, 19th, and 31st among 31 primary industries [15][17]. Key Industry Data and News - The beauty care sector is highlighted by Kimberly-Clark's acquisition of Kenvue and Amorepacific's significant profit increase. Additionally, new medical devices have received regulatory approval [4][24]. - In the travel sector, the number of domestic flights increased by 4.9% compared to 2019, with a total of approximately 101,000 flights executed in the week [5][24]. - The IP derivatives market is seeing growth, with significant sales expected from the film "Wang Wang Mountain" and new store openings in the toy sector [5][28]. Investment Recommendations - The report recommends focusing on companies such as Shangmei Co., Juzhibio, Marubi, Runben, Proya, Chaohongji, and Furuida within the beauty care and new consumption sectors [6][29].

1. Report Industry Investment Rating No relevant content provided. 2. Report's Core View - The U.S. government may end the shutdown, and U.S. stocks rebounded overnight, but the risk of U.S. dollar liquidity still needs attention [3]. - In the domestic market, the rotation of the market has accelerated, with an obvious high - low switch. The large - consumption sector rose significantly on the day, but its sustainability remains to be seen. The semiconductor and new energy sectors declined, and the overall market still supports the index at key levels [3]. 3. Summary by Related Catalogs 3.1 Market Analysis - **International Relations**: The U.S. officially announced a one - year suspension of the 301 investigation measures against China's shipbuilding and other industries. China announced a one - year suspension of the special port dues for U.S. ships and a one - year suspension of countermeasures against five U.S. subsidiaries of Hanwha Ocean Co., Ltd. China also added the U.S., Mexico, and Canada to the export control list of precursor chemicals for specific countries (regions) and separately listed 13 precursor chemicals for these three countries [1]. - **U.S. Government Shutdown**: After a 40 - day government shutdown, the U.S. Senate passed a procedural vote on a temporary appropriation bill to end the shutdown, but the final vote time has not been arranged, and the bill still needs to be voted on by the House of Representatives. It is possible that the U.S. government shutdown will end before this weekend [1]. - **Stock Market**: In the A - share spot market, the three major indexes opened higher and moved higher. The Shanghai Composite Index rose 0.53% to close at 4018.6 points, and the ChiNext Index fell 0.92%. Most industry sectors rose, with the large - consumption sector leading the gains, including beauty care, food and beverage, commerce and retail, and social services. The power equipment, machinery, and electronics sectors led the losses. The trading volume of the two markets in Shanghai and Shenzhen was about 2 trillion yuan. Overseas, the three major U.S. stock indexes all closed higher, with the Nasdaq rising 2.27% to 23527.17 points [1]. - **Futures Market**: In the futures market, the basis of IF, IC, and IM contracts declined. The trading volume of stock index futures increased, and the positions of IH, IF, and IC contracts rose simultaneously [2]. 3.2 Strategy - Overseas, although the U.S. government may end the shutdown and U.S. stocks rebounded overnight, attention should still be paid to the risk of U.S. dollar liquidity [3]. - Domestically, the rotation of the market has accelerated, with an obvious high - low switch. The large - consumption sector rose significantly on the day, but its sustainability remains to be seen. The semiconductor and new energy sectors declined, and the overall market still supports the index at key levels [3]. 3.3 Macroeconomic Charts - Include charts showing the relationship between the U.S. dollar index and A - share trends, U.S. Treasury yields and A - share trends, RMB exchange rate and A - share trends, and U.S. Treasury yields and A - share style trends [7][9]. 3.4 Spot Market Tracking Charts - **Domestic Main Stock Index Daily Performance**: On November 10, 2025, the Shanghai Composite Index closed at 4018.60, up 0.53%; the Shenzhen Component Index closed at 13691.38, up 1.95%; the ChiNext Index closed at 3178.83, down 0.92%; the CSI 300 Index closed at 4695.05, up 0.35%; the SSE 50 Index closed at 3053.86, up 0.51%; the CSI 500 Index closed at 7343.80, up 0.22%; the CSI 1000 Index closed at 7563.25, up 0.28% [13]. - Also include charts of the trading volume of the two markets in Shanghai and Shenzhen and the margin trading balance [14]. 3.5 Stock Index Futures Tracking Charts - **Trading Volume and Position**: The trading volume of IF, IH, IC, and IM contracts increased, and the positions of IH, IF, and IC contracts rose, while the position of the IM contract decreased [16]. - **Basis**: The basis of IF, IC, and IM contracts declined, and specific basis data for different contracts and different periods are provided [38][41]. - **Inter - period Spread**: Data on the inter - period spreads of different contracts and different periods are provided [47][49]. - Also include charts of contract positions, position ratios, and foreign capital net positions of different contracts [17][21][32].

Market Performance - The major indices showed mixed results, with the Shanghai Composite Index closing at 4018.60, up by 0.53% [2] - The Shenzhen Component Index closed at 13427.61, up by 0.18%, while the ChiNext Index fell by 0.92% to 3178.83 [2] - The total trading volume in the Shanghai and Shenzhen markets reached 2.17 trillion, an increase of 175.4 billion compared to the previous trading day [6] Sector Performance - The top-performing sectors included Beauty Care (3.60%), Food and Beverage (3.22%), and Retail (2.69%) [3] - Conversely, the sectors that underperformed were Electric Equipment (-1.09%), Machinery Equipment (-0.71%), and Electronics (-0.51%) [3] - Concept indices showed strong performance in Dairy (4.36%), Cultivated Diamonds (3.46%), and Liquor Concepts (3.01%), while the weakest were in the Fruit Index (-1.56%) and High-Speed Copper Cable Connection (-1.50%) [3] Market Outlook - The market is expected to gradually improve in the fourth quarter, supported by proactive policies, aiming for an annual economic growth target of around 5% [6] - Positive policy signals are anticipated to reshape the investment themes and valuation systems in the capital market, boosting market risk appetite [6] - Defensive sectors such as Finance and Coal, along with low-positioned sectors like Food and Beverage, are recommended for attention [6] Economic Indicators - In October 2025, the national consumer price index (CPI) rose by 0.2% year-on-year and month-on-month [5] - The producer price index (PPI) decreased by 2.1% year-on-year, with the decline narrowing by 0.2 percentage points compared to the previous month [5]

Core Insights - The Small and Medium Enterprises Development Index (SMEDI) in China remained stable at 89.0 in October, unchanged from September and the same as the previous year [1] - Macro policies have been effective in boosting market vitality and improving domestic demand, leading to a steady development trend for SMEs [1][2] Summary by Categories Overall Index - The comprehensive operation index, market index, cost index, and investment index increased by 0.3 points, 0.1 points, 0.1 points, and 0.2 points respectively compared to September [1] - The macroeconomic sentiment index and funding index remained unchanged from September, while the labor and efficiency indices both decreased by 0.1 points [1] Industry-Specific Indices - In October, the indices for the industrial sector, transportation, real estate, and accommodation and catering sectors increased by 0.1 points, 0.3 points, 0.1 points, and 0.4 points respectively [1] - The transportation sector index has risen for two consecutive months, indicating a gradual recovery in economic vitality [2] - Conversely, the indices for construction, wholesale and retail, social services, and information transmission and software sectors decreased by 0.1 points, 0.1 points, 0.3 points, and 0.3 points respectively [1] Regional Indices - The development indices for the central and northeastern regions were 89.8 and 81.6, reflecting increases of 0.2 points and 0.3 points from September [1] - The eastern and western regions maintained their indices at 90.0 and 88.4, respectively, unchanged from September [1] Future Outlook - There are signs of stabilization in business operations, with improved market expectations and reduced operational pressures [2] - The focus will be on enhancing domestic demand, stabilizing employment, and implementing supportive policies for SMEs to sustain economic recovery [2]

Investment Rating - The report does not explicitly state an investment rating for the industry, but it highlights potential opportunities in the tourism and duty-free sectors due to upcoming policy changes and market demand [1]. Core Insights - The consumer sector showed mixed performance in the week of November 3-7, with textile and apparel, retail, and social services sectors experiencing slight gains, while food and beverage, home appliances, and beauty care sectors faced declines [1]. - The announcement of extended holiday periods, including a 9-day Spring Festival, is expected to significantly boost the tourism sector, with early indicators showing a 63% increase in flight bookings for the 2026 Spring Festival compared to the previous year [1]. - The upcoming closure of Hainan's free trade port on December 18, 2025, is anticipated to reshape the local industry landscape and expand the duty-free market, with recent data indicating a recovery in duty-free sales [1]. Summary by Sections Market Weekly Review - The consumer sector's performance varied, with notable stock movements in various sub-sectors, including significant gains for companies like Anji Food (+13.87%) and Kangsheng Co. (+21.05%), while others like Jinzi Ham (-6.22%) and Haili B shares (-13.44%) faced declines [1][13][14]. Industry News and Key Company Announcements - The government has announced a new holiday schedule for 2026, which includes an extended Spring Festival, likely to drive consumer spending and tourism [15][17]. - The Hainan free trade port is set to officially close on December 18, 2025, with new policies aimed at enhancing the duty-free shopping experience, which has already shown signs of recovery in sales figures [1][15]. - Companies in the tourism and duty-free sectors are recommended for investment focus, particularly those with strong market positioning and unique offerings [1].

Group 1 - The market is currently focused on two main events: the recently released CPI and PPI data, which catalyze the consumer sector, and the impending reopening of the U.S. federal government [1][2] - The end of the government shutdown is expected to restore risk appetite in the market, which is seen as a significant positive for global financial markets [5][4] - The shutdown had previously caused liquidity tightening as funds were drawn into the central treasury account, leading to reduced cash flow for banks and businesses [3][2] Group 2 - Following the news of the government reopening, both risk assets and safe-haven assets experienced collective gains, indicating a recovery in liquidity [6][8] - The consumer sector saw a notable rebound, with leading industries such as beauty care, food and beverage, and retail showing significant daily increases, while growth-related sectors like communication and electronics faced declines [10][11] - The Hang Seng Consumer Index recorded its largest single-day gain since 2025, driven by a resurgence in new consumption stocks [15][18] Group 3 - The southbound net purchases of Hong Kong stocks surpassed 5 trillion, marking a historical milestone, with over 1.3 trillion net purchases this year alone [21][24] - The low interest rate environment remains unchanged, with financing demand being the core focus rather than inflation [26][29] - Observations indicate that global investment strategies are being adjusted in response to the resolution of overseas risk events, with changes in fund limits reflecting market conditions [32][33]

Macroeconomic Insights - Global asset performance shows mixed results, with the Hang Seng Index up 1.29% and the Shanghai Composite Index up 1.08%, while developed markets like the S&P 500 fell by 1.63%[6] - In October, the U.S. ISM Manufacturing PMI declined, indicating economic slowdown, while consumer confidence continued to drop according to the University of Michigan index[7] Inflation and Prices - October CPI in China rose by 0.2% year-on-year, while PPI decreased by 2.1%, indicating a stable inflation environment with core service prices reaching their highest level since March 2024[11] - The rise in core CPI is attributed to reduced food drag and increased service contributions, with gold prices significantly impacting jewelry costs[13] Trade and Exports - In October, China's exports fell by 1.1% year-on-year, while imports grew by 1.0%, leading to a slight decrease in trade surplus[16] - The export structure shows weakness in non-U.S. markets, particularly the EU, while exports to the U.S. and ASEAN remained strong[18] Investment Strategies - The asset allocation report suggests an overweight position in Chinese A-shares and industrial commodities, with equity allocation set at 45% and bonds at 45%[22] - The report emphasizes the importance of AI industry trends and the potential for volatility in global equity markets, recommending a focus on quality assets[23] Market Dynamics - The trading activity has decreased, with turnover rates and transaction volumes declining across indices, indicating a cautious market sentiment[28] - The report highlights a decrease in northbound capital flow, with a net outflow of 2.6 billion CNY in the recent week, reflecting investor sentiment shifts[34]

Market Overview - The A-share market shows a divergence with the main board strengthening while the ChiNext board remains under pressure, with the Shanghai Composite Index successfully reclaiming the 4000-point mark [2] - Market sentiment is fluctuating, with over 3300 stocks closing in the green, and the total trading volume in the Shanghai and Shenzhen markets reaching 2.17 trillion, an increase of 175.4 billion from the previous trading day [3] Economic Indicators - The strong performance of consumer sectors such as food and beverage, liquor, and tourism is attributed to the rebound in October's CPI and core CPI data, signaling a recovery in domestic demand and boosting confidence in economic stabilization [3][4] - The Ministry of Finance has reiterated its commitment to continue implementing special actions to boost consumption, providing policy support to these sectors [4] Policy Outlook - The release of the "14th Five-Year Plan" marks the beginning of a new five-year economic and industrial development framework, which will serve as a foundation for future policies and provide a starting point for the policy tone leading up to 2026 [5][7] - Key areas of focus include industrial structure upgrades, technological self-reliance, and boosting domestic consumption [8][10] Sector Focus - For industrial structure upgrades, attention should be directed towards sectors such as mining, chemicals, machinery, and shipbuilding [11] - In terms of technological self-reliance, sectors like new energy, new materials, low-altitude economy, artificial intelligence, integrated circuits, and industrial mother machines are highlighted [11] - The domestic consumption boost should focus on retail, social services, food and beverage, and certain new consumption areas [11] Market Trends - The TMT (Technology, Media, and Telecommunications) and advanced manufacturing sectors are expected to remain the main themes of the bull market [12] - Historical trends indicate that the current market may be in the second phase of a multi-stage rally, with significant potential for growth [14] Investment Opportunities - In the TMT sector, key areas of interest include AI and storage, with AI driving technological innovation and industry transformation, while storage is expected to benefit from sustained demand due to AI [15][16] - In advanced manufacturing, focus areas include humanoid robots, liquid cooling, solid-state batteries, and PCB, with significant developments anticipated in 2026 [17][18] Future Market Dynamics - The market is expected to enter a phase of intense policy expectation, with domestic policies centered around the "14th Five-Year Plan" and the upcoming Central Economic Work Conference, while international policies will be influenced by U.S.-China relations and potential policy shifts from the U.S. midterm elections [21] - Key upcoming events include annual performance forecasts and quarterly reports, which will further validate industry conditions [22]

Investment Rating - The industry investment rating is "stronger than the market," indicating an expected performance exceeding the market index by more than 5% over the next six months [28]. Core Insights - The report highlights marginal improvements in operational performance across specific segments within the consumer sector, suggesting a focus on stable growth areas and sectors showing operational enhancements [4][5]. - The textile and apparel sector led the consumer industry with a 1.56% increase, while the food and beverage sector experienced a decline of 0.54% [5]. - The report emphasizes the importance of monitoring consumer sentiment and emotional fluctuations, particularly in media and cultural sectors, which may present investment opportunities [4]. Summary by Relevant Sections Social Services - The report suggests focusing on leading companies like China Duty Free and Aimeike, which may benefit from low baselines and policy catalysts [4]. - The 2026 holiday schedule has been released, and the successful IPO of Shaanxi Tourism is noted as a potential opportunity in the tourism sector [4]. Textile and Apparel - Continued attention is recommended for investment opportunities in the gold and jewelry accessories sector, particularly for leading brands with potential market share growth [4]. Cultural Communication - The report advises focusing on segments related to spiritual needs and consumer sentiment, which may provide opportunities for media companies [4]. Food and Beverage - Alcohol - The report indicates that major liquor companies are experiencing deeper net profit adjustments, with a focus on leading companies that excel in market management and branding [4]. - Three main lines of focus are suggested: high-end liquor with stable demand, mid-range liquor with national expansion, and local market solidified real estate liquor [4]. Food and Beverage - Mass Products - The report notes high demand in the functional beverage and snack sectors, with specific recommendations for brands like Dongpeng Beverage and Salted Fish [4]. - The dairy sector is expected to see a recovery in profitability, with Yili being highlighted as a recommended stock [4]. Industry Dynamics - The report mentions a 0.9% increase in the average price of pork in the national wholesale market, indicating ongoing price fluctuations in agricultural products [24].

Core Viewpoint - The report from Tianfeng Securities indicates that industries with prolonged weak performance tend to exhibit a "prolonged decline" characteristic, with defensive sectors like environmental protection, public utilities, and transportation more likely to underperform in the long term [1][2] Industry Analysis - Industries that have underperformed for three consecutive years and are nearing their historical longest underperformance periods include beauty care, basic chemicals, and social services [4] - The construction materials, electrical equipment, and food and beverage sectors have been underperforming for a duration close to their historical longest periods, with a difference of about one year [4] - Industries that have underperformed for three consecutive years but have a higher probability of outperforming in the fourth year include food and beverage, agriculture, forestry, animal husbandry, social services, and biomedicine [2][4] Defensive Sector Characteristics - The public utility sector exhibits a typical public utility attribute, characterized by weak cycles and low beta, showing low elasticity during bull markets, as evidenced in the bull markets of 2006-2007, Q1-Q3 of 2009, and H2 of 2014 to H1 of 2015 [3] - The trend of negative excess returns in public utility sectors is attributed to small-cap stocks lacking both offensive characteristics in bull markets and stable dividend attributes, leading to a divergence between industry leaders and small-cap stocks [3] - The independent market performance of leading stocks in the public utility and environmental sectors since 2017 is driven by the revaluation of dividend assets in a low-interest-rate environment, with stable earnings and high dividends contributing to a stronger "moat" and scale effect for these leaders [3] Statistical Insights - An analysis of the Shenwan first-level industries from 2007 to 2025 reveals that the probability of an industry underperforming for three consecutive years is inversely related to the conditional probability of it outperforming in the fourth year [2]