Report Summary 1. Report Industry Investment Rating - The investment rating for treasury bonds is "oscillation" [1] 2. Core View of the Report - China's October fixed - asset investment and export growth rates are lower than market expectations, social consumption growth slightly exceeds expectations, industrial added - value growth is lower than expected, and the real estate market continues to decline. The new social financing and credit scale in October are also lower than expected. Treasury bond futures are expected to continue to oscillate in the short - term, and the impact of stock indexes should be continuously monitored. Trading - type investors are advised to conduct band operations [1][2] 3. Summary by Relevant Catalogs 3.1 Market Review - On Friday, most of the main contracts of treasury bond futures opened slightly higher. After a slight decline in the morning session, they fluctuated narrowly. They once declined in the afternoon and recovered at the end. As of the close, the 30 - year treasury bond futures main contract TL2512 rose 0.03%, the 10 - year T2512 remained flat, the 5 - year TF2512 remained flat, and the 2 - year TS2512 fell 0.01% [1] 3.2 Important Information - **Open Market**: On Friday, the central bank conducted 212.8 billion yuan of 7 - day reverse repurchase operations, with 141.7 billion yuan of reverse repurchases maturing on the same day, resulting in a net investment of 71.1 billion yuan [1] - **Funds Market**: On Friday, the overnight interest rate in the inter - bank funds market rose compared with the previous trading day. The weighted average of DR001 for the whole day was 1.37% (1.32% the previous day), and the weighted average of DR007 for the whole day was 1.47% (1.48% the previous day) [1] - **Cash Bond Market**: On Friday, the closing yields of inter - bank treasury bonds fluctuated narrowly compared with the previous trading day. The 2 - year treasury bond yield rose 0.32 BP to 1.43%, the 5 - year rose 0.33 BP to 1.58%, the 10 - year rose 0.14 BP to 1.81%, and the 30 - year fell 0.10 BP to 2.15% [1] - **Housing Market**: In October, the second - hand housing sales prices in first - tier cities decreased by 0.9% month - on - month, with the decline narrowing by 0.1 percentage points. In second - tier cities, they decreased by 0.6% month - on - month, with the decline narrowing by 0.1 percentage points. In third - tier cities, they decreased by 0.7% month - on - month, with the decline expanding by 0.1 percentage points [1] - **Investment and Consumption Data**: From January to October, the national fixed - asset investment decreased by 1.7% year - on - year (market expectation: - 0.7%, January - September: - 0.5%). In October, the added value of industrial enterprises above designated size increased by 4.9% year - on - year (market expectation: 5.5%, September: 6.5%), and the total retail sales of consumer goods increased by 2.9% year - on - year (market expectation: 2.7%, September: 3.0%). The national urban surveyed unemployment rate in October was 5.1%, 0.1 percentage points lower than the previous month and 0.1 percentage points higher than the same month last year [1][2] - **Policy Information**: On November 14, the State Council Executive Meeting was held to study the in - depth implementation of the "two major" construction, emphasizing strategic, forward - looking, and overall requirements, promoting the development of new - quality productivity, and guiding more private capital participation [2] 3.3 Market Logic - China's October fixed - asset investment and export growth rates are lower than market expectations, social consumption growth slightly exceeds expectations, industrial added - value growth is lower than expected, and the real estate market continues to decline. The new social financing and credit scale in October are also lower than expected. The central bank's third - quarter monetary policy implementation report points out to optimize intermediate variables and pay attention to interest rate parity relationships. The Wande All - A index fell 1.27% on Friday, and treasury bond futures fluctuated horizontally and basically closed flat. Treasury bond futures may continue to oscillate in the short - term, and the impact of stock indexes should be monitored [2] 3.4 Trading Strategy - Trading - type investors are advised to conduct band operations [2]

Group 1 - The bond market sentiment is currently weak, with a poor profit effect, and significant downward movement in interest rates requires strong event-driven stimuli, such as large-scale bond purchases, central bank rate cuts, or significant declines in equity markets [1][8] - The 10-year government bond yield has been fluctuating around 1.8%, with potential for both upward and downward movement, but a rebound opportunity is more likely if the yield approaches 1.9% [1][8] - The report suggests maintaining a slightly lower duration in bond portfolios and focusing on a barbell structure due to the difficulty in significantly steepening the yield curve in a weak market environment [2][39] Group 2 - The report highlights the importance of selecting specific bonds, with a focus on the 30-year government bond 25T6, which is expected to become the next main bond due to its good liquidity and upcoming issuance [3][12] - The yield spread between 25T6 and 25T2 is currently around 10 basis points, with expectations that this spread will compress to about 6 basis points as 25T6 gains prominence [12] - The report also emphasizes the need to monitor the impact of new regulations on fund redemptions, which may lead to increased volatility in certain bond types [2][39] Group 3 - The report indicates that the current bond yield valuations are not expensive compared to other asset classes, but the profit effect from bonds remains weak, making them less attractive [27][28] - The 10-year government bond yield is projected to be around 1.93% in the coming month, reflecting a weak outlook based on the constructed interest rate prediction model [23][24] - The report notes that the yield curve is expected to remain relatively flat, with short-term government bonds showing more resilience compared to long-term bonds [38][39]