Fixed Income Research - The issuance amount and net financing of credit bonds increased significantly on a low base effect, while transaction amounts slightly decreased [2] - The overall change in the issuance guidance rates was a decline of 4 to 2 basis points, with corporate bonds seeing zero issuance [2] - The net financing amount for credit bonds is at a historically high level, with corporate bonds showing a decrease in net financing while other types increased [2] - The transaction amount in the secondary market for credit bonds slightly decreased, with corporate bonds and company bonds seeing an increase [2] - Credit bond yields declined across the board, with credit spreads for medium-term notes, corporate bonds, and urban investment bonds narrowing [2] - The current pricing of credit bonds is considered high, suggesting a cautious approach to increasing positions, with a focus on the trend of interest rate bonds and individual bond coupon values [2] Fund Research - The major indices in the Shanghai and Shenzhen markets experienced fluctuations, with active equity fund positions rising [5] - The average increase for QDII funds was 1.67%, while equity funds averaged a 1.56% increase, with 87.16% showing positive returns [6] - The ETF market saw a net inflow of 15.717 billion yuan, with cross-border ETFs attracting the largest inflow of 13 billion yuan [7] - A total of 38 new funds were issued, raising 39.740 billion yuan, indicating an increase in fundraising activity [8] Industry Research - The suspension of operations in the Ningde Jianxiawo mining area raises concerns about domestic supply disruptions in the metal industry [9] - The steel market is currently in a state of observation due to cooling speculative sentiment, with potential impacts from coal production restrictions [9] - Copper prices are expected to be supported by tight supply, while aluminum prices may fluctuate based on domestic demand and supply adjustments [11] - The gold market is influenced by U.S. employment data and interest rate expectations, with potential upward pressure on prices [11] - The lithium market faces supply disruptions due to mining suspensions, with limited upward price potential in the short term [11] - The rare earth market is experiencing price adjustments after a rapid increase, with attention needed on downstream production and demand [12]

Economic Overview - In July, the manufacturing Purchasing Managers' Index (PMI) was reported at 49.3%, indicating a slight decline of 0.4 percentage points from June, reflecting a decrease in manufacturing activity due to seasonal factors and extreme weather conditions [2][3] - The non-manufacturing business activity index was at 50.1%, and the comprehensive PMI output index was at 50.2%, suggesting overall economic output remains in an expansion phase [1][4] Manufacturing Sector Insights - The production index and new orders index were recorded at 50.5% and 49.4%, respectively, both showing a decline from June, while the new export orders index fell to 47.1% [2] - Large enterprises had a PMI of 50.3%, with key sectors like equipment manufacturing and high-tech manufacturing maintaining PMIs of 50.3% and 50.6%, indicating ongoing expansion [2][3] Price Trends - The price index showed an upward trend, with the main raw material purchase price index at 51.5% and the factory price index at 48.3%, both increasing from June [3] - The rise in prices was attributed to the increase in prices of major commodities such as coal and steel, which significantly impacted the manufacturing PMI [3] Service Sector Performance - The non-manufacturing business activity index remained above 50%, indicating continued expansion despite a slight decline from June [4][5] - The service sector's business activity index was stable, with certain industries related to travel and consumption experiencing high activity levels, while construction activities slowed due to adverse weather [4][5] Future Outlook - Analysts suggest that macroeconomic policies should be adjusted to stimulate demand, particularly through increased government investment in public goods and infrastructure [4] - The upcoming summer consumption is expected to positively influence economic activity in August, supported by ongoing policies aimed at boosting domestic demand [5]

Group 1: Manufacturing Sector - The manufacturing Purchasing Managers' Index (PMI) decreased to 49.3% in July, down 0.4 percentage points from the previous month, indicating a decline in manufacturing activity [1][2] - The production index remained in expansion at 50.5%, while the new orders index fell to 49.4%, reflecting a slowdown in market demand [2] - Large enterprises maintained expansion with a PMI of 50.3%, while medium-sized enterprises improved to 49.5%, and small enterprises decreased to 46.4% [3] Group 2: Price Indices - The price index for major raw materials increased, with the purchasing price index at 51.5% and the factory price index at 48.3%, indicating an overall improvement in manufacturing market prices [2] - The purchasing price index for major raw materials rose above the critical point for the first time since March, suggesting a recovery in market conditions [2] Group 3: Non-Manufacturing Sector - The non-manufacturing business activity index was 50.1%, down 0.4 percentage points from the previous month, but still above the critical point, indicating continued expansion [1][4] - The service sector's business activity index remained stable at 50.0%, with certain industries like transportation and entertainment showing strong growth due to seasonal effects [4] - The construction sector's business activity index fell to 50.6%, influenced by adverse weather conditions, while the business activity expectation index for the service sector rose to 56.6%, indicating optimism among service enterprises [4] Group 4: Composite PMI - The composite PMI output index was 50.2%, down 0.5 percentage points from the previous month, but still indicating overall expansion in production and business activities [5][6] - The manufacturing production index and non-manufacturing business activity index contributed to the composite PMI, standing at 50.5% and 50.1% respectively [6]

Group 1: Manufacturing PMI Overview - In July, the Manufacturing Purchasing Managers' Index (PMI) was 49.3%, a decrease of 0.4 percentage points from the previous month, indicating a decline in manufacturing activity [2][21][22] - The production index was 50.5%, down 0.5 percentage points, while the new orders index was 49.4%, down 0.8 percentage points, suggesting a slowdown in market demand [6][22] - Large enterprises maintained expansion with a PMI of 50.3%, while medium-sized enterprises improved to 49.5%, and small enterprises decreased to 46.4% [5][23][24] Group 2: Non-Manufacturing PMI Overview - The Non-Manufacturing Business Activity Index was 50.1%, a decrease of 0.4 percentage points, but still above the critical point, indicating continued expansion [11][25] - The service sector's business activity index was stable at 50.0%, while the construction sector's index fell to 50.6%, down 2.2 percentage points due to adverse weather conditions [14][25] - The business activity expectation index for non-manufacturing was 55.8%, indicating optimism among most enterprises regarding market development [17][25] Group 3: Comprehensive PMI Overview - The Comprehensive PMI Output Index was 50.2%, a decrease of 0.5 percentage points, but still indicating overall expansion in production and business activities [20][26] - The manufacturing production index and non-manufacturing business activity index were 50.5% and 50.1%, respectively, contributing to the comprehensive index's performance [26]

Manufacturing Sector - The manufacturing PMI for June 2025 is 49.7%, an increase of 0.2 percentage points from the previous month[4] - In June, 11 out of 21 surveyed industries are in the expansion zone, an increase of 4 industries compared to last month[6] - Large enterprises' PMI is 51.2%, up 0.5 percentage points, while small enterprises' PMI is 47.3%, down 2.0 percentage points[11] Supply and Demand - The production index and new orders index are at 51.0% and 50.2%, respectively, both showing increases of 0.3 and 0.4 percentage points[15] - The supply and demand index has rebounded, aligning with seasonal trends, with certain industries like food and beverage showing expansion[15] - Non-metal mineral products and black metal smelting industries continue to contract due to insufficient end demand from the real estate sector[15] Price Index and Procurement - The main raw material purchase price index and factory price index are at 48.4% and 46.2%, both rising by 1.5 percentage points[20] - The procurement index has increased to 50.2%, up 2.6 percentage points, indicating a rise in enterprise procurement activity[21] Non-Manufacturing Sector - The service sector's business activity index is at 50.1%, a slight decrease of 0.1 percentage points, indicating stability[24] - The construction sector's business activity index is 52.8%, up 1.8 percentage points, showing a seasonal rebound but with notable sub-sector differentiation[26] Risks - External disturbances and changes in real estate demand pose risks to the overall economic outlook[30]

Core Viewpoint - After the weakening of tariff frictions, the manufacturing sector shows signs of stabilization, although industry differentiation has intensified, indicating ongoing pressure in the real estate sector [1]. Manufacturing Sector - In June 2025, the manufacturing PMI was 49.7%, an increase of 0.2 percentage points from the previous month, reflecting a seasonal rebound [2]. - The purchasing index rebounded, suggesting that enterprises are gradually adapting to external disturbances, shifting from cautious expansion to a more positive outlook for future production [2]. - There is a notable divergence between large and small enterprises, with large enterprises continuing to expand while small enterprises are further contracting [2]. Supply and Demand - The overall supply and demand index in June showed a seasonal recovery, with certain industries like food, beverages, and specialized equipment in the expansion zone [3]. - The recovery in supply and demand is attributed to the easing of tariff frictions and the positive impact of fiscal policies, particularly in equipment renewal [3]. - Conversely, industries such as non-metallic mineral products and black metal smelting continue to experience contraction due to insufficient end-demand driven by real estate pressures [3]. Price Index - The manufacturing price index increased in June, primarily driven by rising oil prices due to tensions in the Middle East, while the price index for the black metal smelting industry continued to decline [3]. Non-Manufacturing Sector - The service sector's business activity index slightly decreased to 50.1%, indicating stability, but several industries, including retail and transportation, fell below the critical point after the May Day holiday effect faded [3]. - The construction sector showed a seasonal rebound, with civil engineering activities remaining robust, although demand for commercial housing was weak in the second quarter, potentially dragging down overall construction sentiment [3]. Policy Outlook - With the easing of tariff frictions, addressing low inflation internally is crucial. The government plans to issue the third batch of funds for the old-for-new consumer goods program in July, with expectations for positive policy effects [4]. - Future macroeconomic policies are likely to remain proactive, with a steady and loose monetary policy and accelerated fiscal measures anticipated [4].

Core Viewpoint - The overall economic climate in China is showing signs of expansion, with key indices indicating a recovery in both manufacturing and non-manufacturing sectors in June. Group 1: Manufacturing Sector - The Manufacturing Purchasing Managers' Index (PMI) rose to 49.7% in June, with 11 out of 21 surveyed industries in the expansion zone, an increase of 4 from the previous month [3] - Production and new orders indices were at 51.0% and 50.2%, respectively, indicating accelerated manufacturing activities and improved market demand [3] - The purchasing volume index increased to 50.2%, up by 2.6 percentage points, reflecting enhanced procurement willingness among enterprises [3] - Large enterprises showed a PMI of 51.2%, indicating significant support for the manufacturing sector, while medium and small enterprises had PMIs of 48.6% and 47.3%, respectively [4] - Key industries such as equipment manufacturing, high-tech manufacturing, and consumer goods continued to expand, with PMIs of 51.4%, 50.9%, and 50.4% [4] Group 2: Non-Manufacturing Sector - The Non-Manufacturing Business Activity Index reached 50.5%, indicating continued expansion, with a slight increase of 0.2 percentage points from the previous month [5] - The service sector's business activity index was at 50.1%, showing stability, although some consumer-related sectors experienced a decline in activity [5] - The construction industry saw a significant increase, with a business activity index of 52.8%, up by 1.8 percentage points, indicating a recovery in construction activities [5] Group 3: Composite PMI - The Composite PMI Output Index rose to 50.7%, reflecting an overall acceleration in production and business activities across sectors [7][8]

Group 1: Manufacturing Purchasing Managers Index (PMI) Recovery - In June, the manufacturing PMI rose to 49.7%, with 11 out of 21 surveyed industries in the expansion zone, an increase of 4 industries from the previous month, indicating an overall expansion in manufacturing sentiment [2] - The production index and new orders index were at 51.0% and 50.2%, respectively, both showing improvements of 0.3 and 0.4 percentage points from the previous month, suggesting accelerated production activities and improved market demand [2] - The purchasing volume index increased to 50.2%, up by 2.6 percentage points, reflecting enhanced procurement willingness among enterprises due to the recovery in production and demand [2] Group 2: Price Index Recovery - The main raw material purchase price index and factory price index were at 48.4% and 46.2%, respectively, both rising by 1.5 percentage points, indicating an overall improvement in manufacturing market prices [3] - The increase in prices was influenced by rising international crude oil prices, particularly affecting the petroleum, coal, and other fuel processing industries, while the black metal smelting and rolling processing industries saw a decline in price indices due to falling iron ore prices and insufficient terminal demand [3] Group 3: Business Activity Index in Non-Manufacturing Sector - The non-manufacturing business activity index was at 50.5%, up by 0.2 percentage points, indicating continued expansion in the non-manufacturing sector [5] - The service industry business activity index was at 50.1%, slightly down by 0.1 percentage points, with certain sectors like telecommunications and financial services showing strong growth, while consumer-related sectors experienced a decline [5] - The construction industry business activity index rose to 52.8%, an increase of 1.8 percentage points, indicating a recovery in construction activities, particularly in civil engineering [5] Group 4: Comprehensive PMI Output Index - The comprehensive PMI output index was at 50.7%, up by 0.3 percentage points, indicating an overall acceleration in production and business activities across enterprises [6] - The manufacturing production index and non-manufacturing business activity index were at 51.0% and 50.5%, respectively, contributing to the overall expansion reflected in the comprehensive PMI output index [6]

Group 1: Manufacturing PMI Overview - In June, the Manufacturing Purchasing Managers' Index (PMI) was 49.7%, an increase of 0.2 percentage points from the previous month, indicating continued improvement in manufacturing sentiment [1][18] - The production index was 51.0%, up 0.3 percentage points, suggesting accelerated production activities in manufacturing [2][19] - The new orders index rose to 50.2%, an increase of 0.4 percentage points, indicating improved market demand [3][19] Group 2: Manufacturing Sub-indices - The raw materials inventory index was 48.0%, up 0.6 percentage points, indicating a continued narrowing of the decline in raw material inventory levels [3][19] - The employment index decreased to 47.9%, down 0.2 percentage points, reflecting a slight decline in employment sentiment within manufacturing [3][19] - The supplier delivery time index was 50.2%, an increase of 0.2 percentage points, indicating faster delivery times from suppliers [3][19] Group 3: Non-Manufacturing PMI Overview - The non-manufacturing business activity index was 50.5%, up 0.2 percentage points, indicating continued expansion in the non-manufacturing sector [6][22] - The construction industry business activity index rose to 52.8%, an increase of 1.8 percentage points, indicating accelerated expansion in construction activities [7][23] - The service industry business activity index was 50.1%, a slight decrease of 0.1 percentage points, indicating stability in the service sector [7][23] Group 4: Non-Manufacturing Sub-indices - The new orders index for non-manufacturing was 46.6%, up 0.5 percentage points, indicating a slight recovery in market demand [10][22] - The input prices index was 49.9%, up 1.7 percentage points, indicating stable input prices for non-manufacturing activities [10][22] - The business activity expectation index was 55.6%, down 0.3 percentage points, indicating continued optimism among non-manufacturing enterprises [11][22] Group 5: Comprehensive PMI Overview - The comprehensive PMI output index was 50.7%, an increase of 0.3 percentage points, indicating an overall acceleration in production and business activities [16][24] - The manufacturing production index and non-manufacturing business activity index were 51.0% and 50.5%, respectively, contributing to the overall expansion [24][18]

Group 1: PMI Overview - The manufacturing PMI for May is at 49.5%, a month-on-month increase of 0.5 percentage points, still in the contraction zone[4] - The production index rose to 50.7%, up 0.9 percentage points, indicating a return to the expansion zone[4] - The new orders index increased to 49.8%, up 0.6 percentage points, reflecting improved demand[4] Group 2: Sector Performance - The new export orders index rose to 47.5%, up 2.8 percentage points, but remains below the levels seen in March (49.0%) and April[4] - High-tech manufacturing PMI decreased by 0.6 percentage points to 50.9%, remaining in the expansion zone for four consecutive months[4] - Large enterprises' PMI increased to 50.7%, up 1.5 percentage points, while medium enterprises' PMI fell to 47.5%, down 1.3 percentage points[5] Group 3: Price and Inventory Trends - The raw materials price index is at 46.9%, down 0.1 percentage points, indicating ongoing price pressure[4] - The finished goods price index is at 44.7%, also down 0.1 percentage points, suggesting weak downstream demand[4] - The raw materials inventory index is at 47.4%, up 0.4 percentage points, while the finished goods inventory index is at 46.5%, down 0.8 percentage points[5] Group 4: Economic Outlook - The production activity expectation index for manufacturing is at 52.5%, up 0.4 percentage points, indicating improved business sentiment[6] - The overall economic environment shows a structural characteristic where supply exceeds demand, necessitating policy support to alleviate price pressures[4]