Group 1 - The core viewpoint of the article emphasizes the need for a comprehensive approach to address "involution" in various sectors, highlighting the importance of policy coordination and market mechanisms [2][6][65] - The recent meeting of the Central Financial Committee outlines a higher-level and broader coverage for the "anti-involution" initiative, focusing on the integration of local governments, enterprises, and residents [2][65] - The article identifies a significant decline in revenue growth for "involution" industries, dropping from 28.5% in 2021 to -0.4% in 2024, while fixed costs remain rigid, leading to a drastic reduction in average net profit growth to -28.2% [20][19][66] Group 2 - "Involution" is primarily manifested through low-price competition, which compresses supply chain costs, with accounts payable turnover decreasing to 4.6% in 2024, down by 1 percentage point from 2021 [26][31][66] - The internal cost-cutting measures in "involution" industries include a significant reduction in sales expenses, projected at -9.7% for 2024, and a decrease in management expenses growth to 2.6% [31][66] - The profitability of "involution" industries remains under pressure, with a return on assets (ROA) of 2.9% in 2024, a decline of 2.7 percentage points from the 2021 peak, which may hinder long-term industry transformation and development [40][66] Group 3 - To resolve the "involution" dilemma, the focus should be on alleviating supply-demand contradictions and promoting the orderly exit of outdated production capacity, while also restructuring demand expansion dynamics [44][50][66] - Structural transformation can be driven by policy guidance, industry self-discipline, and market mechanisms, encouraging innovation and moving away from price competition [50][66] - Addressing structural unemployment during the transformation process by accelerating the development of the service sector is crucial, as recent trends show a decline in employment in key service industries [56][66]

Group 1 - The article discusses the monitoring framework for the economic impact of tariffs in the U.S., focusing on trade, prices, and risks [6] - It highlights the significant effects of tariffs on the Producer Price Index (PPI) and the support for the core Consumer Price Index (CPI) due to improved consumer demand [18] - The article emphasizes the need for a comprehensive approach to address "involution" in various industries, identifying sectors that may be caught in this competitive spiral [8][27] Group 2 - The analysis of April economic data indicates a transition from strong "old forces" to a recovery phase for "new forces" in the economy [15] - The article points out the challenges in service consumption recovery, which is facing a supply-demand dilemma beyond just income factors [11] - It notes the differentiation in shipping prices and the stable operation of industrial production, alongside improvements in infrastructure construction [24]

Deep Dive - The article discusses a monitoring framework for assessing the economic impact of tariffs in the U.S., focusing on three main modules: trade, prices, and risks [6]. Hot Topics - The concept of "anti-involution" is introduced, highlighting the government's new approach to address "involution-style" competition, identifying industries potentially caught in this phenomenon [8]. - The article examines the blind spots affecting consumer recovery, noting that while goods consumption is returning to normal, service consumption faces supply-demand challenges [11]. Economic Data Review - The analysis indicates that the previous strong "old forces" in the economy are entering a decline phase, while "new forces" continue to build momentum for recovery [15]. - The fiscal data review suggests that there is still room for acceleration in fiscal policy, with tariffs significantly impacting PPI, but improving consumer demand providing substantial support for core CPI [18]. High-Frequency Tracking - The article reports on the recent U.S. CPI data, which was weaker than market expectations, while retail sales showed stronger performance [20]. - Domestic industrial production remains stable, with improvements in infrastructure projects, although shipping prices are showing divergent trends [24]. Policy Insights - The article outlines recent policy measures aimed at maintaining fair competition in the market and addressing "involution-style" competition [27]. Top Charts - The discussion on the "irreplaceability" of Chinese manufacturing highlights certain phenomena that demonstrate this characteristic [29].

Group 1: Report Title and Analyst Information - Report Title: "De-stocking Pressure Remains, Focus on Raw Material Industries - Industry Prosperity Series II" [1] - Analyst: Xu Wenyu,从业资格号: F0299877, Investment Consulting Number: Z0011454, Email: xuwenyu@htfc.com [2] Group 2: Report Investment Rating - No investment rating information provided Group 3: Core Views Manufacturing - Overall: In April, the manufacturing PMI's five - year percentile was 6.7%, with a change of - 62.7%. Five industries' manufacturing PMI was in the expansion range, a decrease of 3 month - on - month and 4 year - on - year [4] - Supply: On hold. In April, the manufacturing PMI production index was 49.8, a decrease of 2.8 percentage points month - on - month. Nine industries improved month - on - month, and 6 declined [4] - Demand: On hold. In April, the manufacturing PMI new orders were 49.2, a decrease of 2.6 percentage points month - on - month. Eight industries improved month - on - month, and 7 declined [4] - Inventory: De - stocking continued. In April, the manufacturing PMI finished - goods inventory increased by 0 percentage points to 47.6. Four industries' inventory increased month - on - month, and 11 declined. In March, the manufacturing PMI raw material inventory decreased by 0.4 percentage points to 47.3. Five industries' inventory increased month - on - month, and 10 declined [4] Non - manufacturing - Overall: In April, the non - manufacturing PMI's five - year percentile was 23.7%, with a change of - 10.1%. Eleven industries' non - manufacturing PMI was in the expansion range, unchanged month - on - month and a decrease of 3 year - on - year [5] - Supply: Employment slowed. In April, the non - manufacturing PMI employee index was 46.3, unchanged month - on - month. The service industry increased by 0.1 percentage points, and the construction industry decreased by 0.4 percentage points [5] - Demand: Demand declined. In March, the non - manufacturing PMI new orders were 46.4, a decrease of 0.7 percentage points month - on - month. The service industry's new orders decreased by 0.4 percentage points, and the construction industry's decreased by 2.6 percentage points [5] - Inventory: De - stocking continued. In March, the non - manufacturing PMI inventory was 45.3, a decrease of 0.1 percentage points month - on - month. The service industry decreased by 0.1 percentage points, and the construction industry decreased by 0.7 percentage points [5] Group 4: Summary by Directory Overview - Manufacturing PMI: In April, the manufacturing PMI's five - year percentile was 6.7%, with a change of - 62.7%. Five industries' manufacturing PMI was in the expansion range, a decrease of 3 month - on - month and 4 year - on - year [10] - Non - manufacturing PMI: In April, the non - manufacturing PMI's five - year percentile was 23.7%, with a change of - 10.1%. Eleven industries' non - manufacturing PMI was in the expansion range, unchanged month - on - month and a decrease of 3 year - on - year [10] Demand: Focus on the Improvement of Special - Purpose Equipment and Information - Manufacturing: Based on the three - month average, in April, the manufacturing PMI new orders were 49.2, a decrease of 2.6 percentage points month - on - month. Eight industries improved month - on - month, and 7 declined [17] - Non - manufacturing: Based on the three - month average, in April, the non - manufacturing PMI new orders were 45.9, a decrease of 0.5 percentage points month - on - month. The service industry's new orders decreased by 0.3 percentage points, and the construction industry's decreased by 1.7 percentage points. Five industries improved month - on - month, and 10 declined [17] Supply: Focus on the Contraction of Petroleum and Construction - Manufacturing: Based on the three - month average, in April, the manufacturing PMI production index was 49.8, a decrease of 2.8 percentage points month - on - month. Nine industries improved month - on - month, and 6 declined. In April, the manufacturing PMI employee index was 48.2, a decrease of 0.1 percentage points month - on - month. Eight industries improved month - on - month, and 7 declined [24] - Non - manufacturing: Based on the three - month average, in April, the non - manufacturing PMI employee index was 45.9, a decrease of 0.4 percentage points month - on - month. The service industry increased by 0.2 percentage points, and the construction industry decreased by 3.6 percentage points. Six industries improved month - on - month, and 8 declined [24] Price: Focus on the Pressure of Non - Metallic Products and Real Estate - Manufacturing: Based on the three - month average, in April, the manufacturing PMI ex - factory price index was 47.1, a decrease of 0.9 percentage points month - on - month. Four industries' ex - factory prices improved month - on - month, and 11 declined. In terms of profit, in March, the profit trend increased by 0.8 percentage points month - on - month, and the overall continued to converge [32] - Non - manufacturing: Based on the three - month average, in April, the non - manufacturing charge price index was 47.0, a decrease of 0.7 percentage points month - on - month. The service industry decreased by 0.8 percentage points, and the construction industry decreased by 0.2 percentage points. Four industries improved month - on - month, and 11 declined. In terms of profit, in March, the profit increased by 0.4 percentage points month - on - month. The service industry increased by 0.7 percentage points, and the construction industry decreased by 1.6 percentage points [32] Inventory: Focus on the Low Levels of the Ferrous Metal Smelting and Rolling Processing Industry and the Nation - Manufacturing: Based on the three - month average, in April, the manufacturing PMI finished - goods inventory increased by 0.3 percentage points to 47.9. Eight industries' inventory increased month - on - month, and 7 declined. In March, the manufacturing PMI raw material inventory decreased by 0.2 percentage points to 47.1. Six industries' inventory increased month - on - month, and 9 declined [41] - Non - manufacturing: Based on the three - month average, in April, the non - manufacturing PMI inventory was 45.3, an increase of 0.2 percentage points month - on - month. The service industry increased by 0.2 percentage points, and the construction industry decreased by 0.9 percentage points. Ten industries' inventory increased month - on - month, and 5 declined [41] Main Manufacturing Industry PMI Charts - The report provides PMI data for various manufacturing industries including special - purpose equipment, general equipment, automobiles, computers, motors, pharmaceuticals, etc., showing values, month - on - month and year - on - year changes, and three - year averages [48][49][52]