Group 1 - The core viewpoint of the article is that the U.S. economy is transitioning from a "K-shaped divergence" to a "reflation" phase, indicating a shift in global liquidity expectations from easing to tightening [2][5][7] - The "K-shaped divergence" is characterized by a healthy balance sheet in the U.S. private sector, particularly among high-net-worth individuals who have significant net assets, primarily in real estate and equities [3][10] - The refinancing opportunities for the high-net-worth group support consumer resilience and liquidity in the U.S. stock market, while the new debt group faces challenges due to their reliance on cash flow and debt to acquire assets [4][12][16] Group 2 - The transition from "K-shaped divergence" to "reflation" is marked by the upward movement of the lower end of the K, where high-net-worth individuals stabilize economic and asset price expectations, benefiting the new debt group [5][17][18] - There is a self-reinforcing mechanism in inflation expectations driven by demand, which can lower real interest rates and compress credit spreads, leading to a unique situation where actual mortgage rates are at a three-year low [6][19] - The global liquidity landscape is shifting, with Bitcoin serving as a barometer for liquidity trends, and the expectation of a "rate cut + balance sheet reduction" policy combination indicates a non-typical reflation trade [7][23][24]

Core Viewpoint - In July 2025, major asset performance was led by the ChiNext Index, followed by oil and the CSI 500, with a general upward trend in risk assets, particularly in Chinese markets, while commodities showed mixed results [1][2][14]. Group 1: Asset Performance - In July, risk assets mostly rose, with Chinese assets leading the way and U.S. stocks reaching new highs, while domestic commodities experienced low-level increases [2][14]. - The performance of commodities was predominantly positive, with oil prices rising due to multiple favorable factors, while copper prices retreated due to lower-than-expected copper tariffs [2][17]. - The three major U.S. stock indices closed higher, with technology stocks showing significant resilience due to strong earnings reports [2][19]. Group 2: Macroeconomic Insights - The macroeconomic landscape in July 2025 was characterized by a divergence between hard and soft data in the U.S., while China's soft data indicated a slowdown [4][62]. - The domestic "stock-bond seesaw" effect deepened, with the total A-share index rising by 4.7% in July, while the yield on 10-year government bonds increased by 5.75 basis points to 1.71% [2][32]. Group 3: Key Drivers of Equity Assets - Future drivers for equity assets may include "profitability and risk appetite," with A-shares needing to respond to fundamental factors such as PPI trends and mid-year earnings [5][62]. - The reduction of uncertainties surrounding U.S.-China tariffs could enhance short-term export certainty, as recent high-level trade talks indicated a potential extension of tariff measures [5][62]. - New technological themes, such as advancements in artificial intelligence, are expected to create investment opportunities [5][62]. Group 4: Market Timing Signals - The M1-BCI-PPI timing system indicated a slight improvement in overall positive signals despite a slowdown in actual GDP growth [6][62]. - The stock-bond valuation ratio showed a return to neutrality, suggesting that while equity assets have lost some advantage, the overall score still leans towards equities [7][62]. Group 5: Sector Performance - In July, over 90% of industries in the domestic market reported positive returns, with growth and cyclical sectors leading the gains, particularly in steel, pharmaceuticals, and construction materials [2][32][44]. - The real estate sector saw a widening year-on-year decline in sales, with second-hand home sales showing more resilience compared to new homes [2][42]. Group 6: Commodity Market Dynamics - The commodity market showed a general upward trend in July, with significant increases in domestic pricing for black metals and polysilicon, while international oil and copper prices exhibited mixed performance [17][62]. - The Brent crude oil futures price increased by 7.3% in July, driven by geopolitical factors and tariff negotiations, although it faced a pullback in early August [17][62].