13 October 2025 | 12:56AM HKT Economics Research CHINA DATA INSIGHTS Gauging the Pace of Fiscal "Spend-Through" (Wang) Andrew Tilton +852-2978-1802 | andrew.tilton@gs.com Goldman Sachs (Asia) L.L.C. Hui Shan +852-2978-6634 | hui.shan@gs.com Goldman Sachs (Asia) L.L.C. Lisheng Wang +852-3966-4004 | lisheng.wang@gs.com Goldman Sachs (Asia) L.L.C. Xinquan Chen +852-2978-2418 | xinquan.chen@gs.com Goldman Sachs (Asia) L.L.C. Yuting Yang +852-2978-7283 | yuting.y.yang@gs.com Goldman Sachs (Asia) L.L.C. Chelsea S ...

October 10, 2025 11:04 PM GMT US Rates Strategy | North America A Fond Farewell to 10-Year Treasury Yields Above 4.00% The US government shutdown and escalation in trade tensions present obvious challenges to the glass-half-full view of most investors. The longer the shutdown lasts and higher trade policy uncertainty climbs, the more the glass will look half-empty. Buy US Treasuries before more 4-handles disappear. Key Takeaways Please add me to your distribution list. Downloaded by Neil.Wang@troweprice.com ...

Summary of Key Points from the Conference Call Industry Overview - The discussions primarily focused on the Chinese economy and its various dynamics, including growth rates, export performance, and geopolitical factors affecting trade and investment. Key Topics and Insights 1. Slowing Growth and Policy Stimulus - Major activity indicators such as industrial production, retail sales, and fixed asset investment showed notable year-over-year growth deceleration in July and August [4][5] - Investors are increasingly concerned about the potential for additional policy easing due to signs of economic weakening, although policymakers appear relatively unconcerned as growth remains above 5% year-over-year [4][5] 2. Chinese Export Slowdown - There is a divergence in investor opinions regarding the outlook for Chinese exports, with some believing a slowdown is delayed while others expect it to persist despite increased US tariffs [6] - The forecast for China's current account surplus is around 3.5% of GDP for 2025 and 2026, which is significantly higher than consensus expectations [6] 3. Anti-involution and Deflation - The concept of "anti-involution" is seen as a medium-term strategy to combat deflation and improve corporate profitability, though its effects may take time to materialize [7][9] - The government aims to address issues such as overcapacity and excessive price competition, which hinder innovation and high-quality growth [9] 4. Disconnect Between Real Economy and Equity Market - There is a notable disconnect between weak domestic demand and strong equity market performance, raising questions about the sustainability of this trend [10] - Despite concerns, many investors remain positive on Chinese equities, viewing them favorably compared to other investment options [10][11] 5. Focus on Consumption in the 15th Five Year Plan - Investors are concerned about China's reliance on exports and the low share of household consumption in GDP, fearing potential economic challenges similar to those faced by Japan in the 1990s [12][14] - There is cautious optimism regarding a policy shift towards boosting consumption, although the government is still focused on technological innovation and high-tech manufacturing [15] 6. US-China Relations and Geopolitics - Discussions highlighted the importance of US-China relations, with clients expressing interest in potential trade agreements and geopolitical risks, particularly concerning Taiwan [16] - The sentiment among investors is shifting towards a multipolar world, with expectations of a weaker Dollar and stronger RMB in the long term [16] Additional Important Insights - The implementation of previously announced policies, such as the RMB 500 billion financing instrument for infrastructure projects, is expected, but new easing measures are unlikely in the short term [5] - The potential for significant capital flows from households into the equity market could drive market performance higher in the coming quarters [11] This summary encapsulates the critical discussions and insights from the conference call, providing a comprehensive overview of the current state and outlook of the Chinese economy and its investment landscape.

Core Insights - Jefferies Financial Group, Inc. has addressed recent inaccuracies and conflated allegations regarding its involvement with First Brands, emphasizing the importance of clear communication with clients and stakeholders [1] Group 1 - The company has released a letter from CEO Rich Handler and President Brian Friedman to clarify its position amidst the surrounding circumstances related to First Brands [1] - The communication aims to rectify misinformation that has been circulating in articles and snippets mentioning Jefferies [1]

SHANGHAI, CHINA - AUGUST 14, 2025 - Tourists are visiting the Bund in Shanghai, China on August 14, 2025.Asia-Pacific markets fell Monday after China and the U.S. tightened trade restrictions and traded fresh accusations, renewing tensions between the world's two largest economies.China on Sunday said "we are not afraid of" a trade war with the United States after President Donald Trump vowed to impose punishing new retaliatory tariffs on Chinese imports.A spokesperson for China's Ministry of Commerce accus ...

Core Viewpoint - Jefferies Financial Group Inc. and its trade finance arm Point Bonita Capital are under investigation for potential violations of federal securities laws related to their significant exposure to First Brands Group, which recently declared bankruptcy [1][4]. Group 1: Company Overview - Jefferies is an investment banking and capital markets firm, while Point Bonita Capital serves as its trade finance division [2]. - Both firms were closely associated with First Brands Group, an auto parts supplier that filed for bankruptcy in September 2025 [2]. Group 2: Financial Exposure - On October 8, 2025, Jefferies disclosed that it and Point Bonita had approximately $715 million in exposure to First Brands' receivables, accounting for about 25% of Point Bonita's trade finance portfolio [3]. - Following this announcement, Jefferies' stock price dropped by $4.66, or approximately 8%, from $59.10 on October 7, 2025, to $54.44 on October 8, 2025 [3]. Group 3: Legal Investigation - Bleichmar Fonti & Auld LLP is investigating whether Jefferies and/or Point Bonita made materially false and misleading statements to investors regarding their exposure to First Brands [4].

Core Viewpoint - Jefferies Financial Group Inc. is currently under investigation for potential fraud, providing an opportunity for investors to join the legal proceedings with the Schall Law Firm [1] Company Summary - The investigation pertains to allegations of fraud involving Jefferies Financial Group Inc., which may impact investor confidence and the company's reputation [1] - Investors are being encouraged to participate in the investigation, indicating potential legal ramifications for the company [1] Industry Summary - The financial services industry may face increased scrutiny and regulatory challenges as a result of this investigation, potentially affecting other firms within the sector [1]

Core Viewpoint - The cohead of global banking and markets at Goldman Sachs, Ashok Varadhan, describes the current stock market bull run as "fairly high-quality" and emphasizes that US equities remain the best investment option [1][5]. Market Performance - The Dow Jones, S&P 500, and Nasdaq experienced significant lows in April following the announcement of tariffs by President Trump, but have since shown "very little volatility" [2][5]. - Varadhan indicates that the market's recovery can be viewed as a high-quality rally based on the stability observed since the lows [2][3]. Investment Strategy - Varadhan favors US equities due to anticipated future interest rate cuts, potential fiscal support from proposed legislation, the market's capacity to handle tariffs, and the ongoing rise of AI [3]. - He notes that while many investors share this optimistic outlook, a cautious approach among investors contributes to the market's upward movement [3]. AI and Market Positioning - Varadhan expresses confidence in the AI sector, stating it has gained momentum since early 2023 and suggests that investors should take advantage of the current market calm to increase "convexity" in their positions [4]. - He recommends purchasing index puts on equities and calls on the dollar, highlighting that these strategies can be executed "fairly cheaply" [4].

Core Insights - The gold rally is being driven by ETFs and central banks, indicating strong institutional demand for gold [1] - A squeeze in the silver market is contributing to rising silver prices, suggesting a tight supply situation [1] Group 1: Gold Market - ETFs and central banks are significant players in the current gold rally, highlighting a shift towards gold as a safe-haven asset [1] - The demand from these entities is expected to continue influencing gold prices positively [1] Group 2: Silver Market - The silver market is experiencing a squeeze, which is pushing prices higher due to limited supply [1] - This situation in the silver market may attract further investment interest as prices rise [1]

Core Insights - Morgan Stanley (MS) is expected to announce its third-quarter 2025 earnings on October 15, with strong performance anticipated due to robust trading and investment banking activities [1][2][7] Revenue and Earnings Estimates - The Zacks Consensus Estimate for MS' third-quarter revenues is $16.25 billion, indicating a year-over-year growth of 5.6% [2] - The earnings estimate for the upcoming quarter has been revised 2% higher to $2.07, reflecting a 10.1% improvement from the same quarter last year [3][4] Investment Banking Performance - Global mergers and acquisitions (M&As) have rebounded significantly in Q3 2025, contributing positively to Morgan Stanley's advisory fees, which are estimated at $589 million, a 7.9% year-over-year increase [6][8] - The consensus estimate for investment banking (IB) income is $1.51 billion, suggesting a 3.4% year-over-year rise [10][11] Trading Revenues - Trading revenues are expected to be strong, driven by increased client activity and market volatility, with equity trading revenues estimated at $3.22 billion (5.7% increase) and fixed-income trading revenues at $2.05 billion (2.5% increase) [12][13] Net Interest Income (NII) - The consensus estimate for net interest revenues is $2.34 billion, indicating a year-over-year rise of 6.4%, supported by stable funding costs and loan growth [15] Expenses and Cost Management - Total non-interest expenses are anticipated to be $11.4 billion, reflecting a 2.7% year-over-year increase, as the company continues to invest in its franchises [16] Earnings Surprise History - Morgan Stanley has a strong earnings surprise history, having outperformed the Zacks Consensus Estimate in the last four quarters with an average beat of 20.3% [4] Stock Performance - In Q3, Morgan Stanley's stock performance was strong, performing better than peers like JPMorgan and in line with Goldman Sachs [19]