1. Report Industry Investment Rating No relevant content provided. 2. Core Viewpoints of the Report - After the production rush at the end of the third quarter in October, the economy weakened again at the beginning of the quarter. Coupled with the high base in the service industry, the estimated monthly GDP was around 4.5%, a relatively low level since the beginning of the year [10]. - The incremental impact of the "two 50 billion" in October has not yet appeared, including less - than - expected credit and infrastructure investment effects [12]. - The "broad credit" verification from November to December is still an important observation clue for the fundamentals. The effects of this round of policy tools are expected to continue until the first quarter of 2026 [17]. 3. Summary by Relevant Catalogs 3.1 "Broad Credit" Effect May Appear with a Lag - **GDP Estimation**: In October, affected by factors such as the end of the peak season in the service industry, weak exports, and more holidays, the GDP dropped to about 4.5%, a low level since the beginning of the year [10]. - **Influence of "Two 50 Billion"**: In October, the incremental impact of the "two 50 billion" was not evident. The new medium - and long - term corporate loans decreased year - on - year, and infrastructure investment was weaker than the seasonal average, with a lower leveraging effect than in 2022 [12]. - **Reasons**: Policy tools were gradually launched from the end of September to the end of October, and the capital effects may not be fully reflected. There may be an overlap between policy - supported projects and special bond projects, and the project scope has expanded to light - asset industries, resulting in a weaker loan - leveraging effect [17]. - **Outlook**: The "broad credit" verification from November to December is crucial. Considering the high base formed by the strong "good start" this year, macro - policies in 2026 may need to be implemented earlier, and the effects of this round of tools are expected to last until the first quarter of 2026 [17]. 3.2 October Data Interpretation: Mild Slowdown of Economic Momentum at the Beginning of the Quarter 3.2.1 Infrastructure - **Investment Situation**: From January to October, the cumulative year - on - year growth rate of infrastructure investment (excluding electricity) was - 0.1%, and the full - scale infrastructure investment was + 1.5%, showing a further decline. In October, the year - on - year growth rate of infrastructure investment excluding electricity was - 8.9%, and the full - scale infrastructure was - 12.1%, accelerating the decline [18]. - **Future Outlook**: Although 50 billion of policy - based financial instruments were fully invested by the end of October, and the new orders and business activity expectations in the construction industry PMI improved, the actual workload may be postponed, and the investment data from November to December need to be verified [18]. 3.2.2 Real Estate - **Investment and Sales**: From January to October, the cumulative year - on - year growth rate of real estate investment was - 14.7%, and the single - month year - on - year was - 23.0%. The decline in construction narrowed, while the decline in new construction and completion expanded. In October, the year - on - year decline in residential sales area was - 19.6%, and the decline had been expanding for three consecutive months. The month - on - month decline in new and second - hand residential sales prices also expanded [23]. - **Future Outlook**: Attention should be paid to the probability of further adjustment of purchase - restriction policies in first - tier cities and the tone of the Central Economic Work Conference at the end of the year [23]. 3.2.3 Manufacturing Investment - **Investment Performance**: In October, the cumulative year - on - year growth rate of manufacturing investment was + 2.7%, and the single - month year - on - year was - 6.7%, with the decline expanding by 4.8 percentage points. Except for the automobile manufacturing and equipment transportation manufacturing industries, the single - month year - on - year growth rates of other industries turned negative [27]. - **Reasons and Outlook**: Due to the high base formed by the concentrated implementation of the equipment renewal policy from October to the end of last year and the bottom - up recovery of corporate profits and capacity control, manufacturing investment may continue to be in an adjustment period in the short term [27]. 3.2.4 Consumption - **Overall Situation**: In October, the year - on - year growth rate of social retail sales was + 2.9%, a slight decline from the previous month. The month - on - month seasonally adjusted growth rate recovered to + 0.16%, a relatively weak seasonal level [31]. - **Sub - items**: In terms of catering, the year - on - year growth rate was + 3.8%, and the month - on - month growth rate was + 15.3%, better than the average of the past three years. In terms of commodity retail, the year - on - year growth rate of above - quota commodity retail was + 1.4%, a decrease of 1.3 percentage points from September. Most subsidized categories showed a decline, while non - subsidized categories such as gold and silver jewelry performed well. The year - on - year growth rate of online commodity retail slowed down [36]. 3.2.5 Industry - **Production Situation**: In October, the year - on - year growth rate of industrial production was + 4.9%, and the month - on - month seasonally adjusted growth rate was + 0.17%, a seasonal decline and a relatively weak level since 2019. The decline in exports and the season - beginning effect dragged down manufacturing production [38]. - **Future Outlook**: In November, with the disappearance of holiday disturbances and the release of policy funds, industrial production may experience seasonal recovery [41].

Production - Industrial production growth in August was 5.2%, below the expected 5.8% and down 0.5 percentage points from the previous month[3] - The decline in industrial production was primarily due to a decrease in export growth, which turned negative at -0.4% for the first time this year, down 1.2 percentage points from last month[3] - The service production index growth fell to 5.6%, indicating a slowdown in the service sector[3] Investment - Fixed asset investment growth in August was -7.1%, a decline of 1.8 percentage points, with a cumulative growth of 0.5%, down 1.1 percentage points from the previous month[4] - Real estate investment saw a significant drop, with a monthly growth rate of -19.5% and a cumulative decline of -12.9%[4] - Infrastructure investment also decreased, with broad infrastructure cumulative growth at 5.4% and narrow infrastructure at 2.0%, both down from the previous month[4] Consumption - Retail sales growth in August was 3.4%, a decrease of 0.3 percentage points from the previous month, indicating a cooling in consumer spending[5] - Dining consumption showed slight recovery with a growth rate of 2.1%, while overall goods retail growth was 3.6%, down 0.3 percentage points[5] - The consumption of gold and jewelry surged to 16.8%, doubling from the previous month, while other discretionary categories showed mixed results[6] Outlook - The economic slowdown in August reflects ongoing pressures in production, investment, and consumption, necessitating targeted policy interventions[7] - Future policy efforts are expected to focus on boosting investment and service consumption, with financial tools likely to support infrastructure investment[7] - The overall economic environment remains challenging, with continued pressure from declining exports and a cooling real estate market[7]