26 March 2026 2025 Annual Results 1 Disclaimer This document does not constitute an offer or invitation to purchase or subscribe for any securities or relevant derivatives of China Mobile Limited (the "Company") or the rendering of any investment advice, and no part thereof shall be relied upon or taken as the basis of any contract, commitment or investment decision relating to such securities or relevant derivatives, and this document does not constitute a recommendation in respect of the securities or rel ...

Artificial intelligence (AI) is likely to change the world as we know it. That's the headline that has had investors enthralled with AI chipmakers like Nvidia (NVDA 0.33%) and AI service companies like SoundHound (SOUN 7.69%). However, in reality, AI is just a fancy computer program. Those programs won't run without a reliable power source.And that is why long-term investors looking to ride the AI wave will probably find more mundane businesses like Brookfield Renewable (BEP +2.19%)(BEPC +2.37%), NextEra En ...

Core Insights - Alibaba's cloud and AI units achieved another quarter of triple-digit growth, indicating strong performance in these segments [1] - The company's shift towards rapid e-commerce delivery has resulted in increased costs, leading to an earnings miss [1] Group 1: Financial Performance - The cloud and AI divisions continue to show robust growth, contributing positively to Alibaba's overall performance [1] - Despite the growth in cloud and AI, the pivot to e-commerce delivery has negatively impacted earnings [1] Group 2: Strategic Shift - Alibaba's strategy to enhance e-commerce delivery is costly and has not yet translated into expected financial results [1] - The focus on rapid delivery may require further evaluation to balance growth and profitability [1]

Summary of Japanese Equities Investment Strategy Industry Overview - **Industry**: Japanese Equities - **Key Indices**: TOPIX, Nikkei 225 Core Insights and Arguments 1. **Geopolitical Risks**: Anxiety over geopolitical risks, particularly related to Iran, is expected to settle down, which could positively impact Japanese equities [1][7][102] 2. **Market Dynamics**: Financial markets are experiencing a pattern where initial stories drive market movements, which later reverse as the market stabilizes. This includes the expectation of rising P/E multiples following political events and the impact of AI on SaaS stocks [1][2] 3. **Profit Growth**: A forecast of double-digit profit growth in FY26 is anticipated, supporting the case for stock market gains [2][106] 4. **Share Buybacks**: The reduction in outstanding shares due to buybacks and tender offers is expected to contribute positively to equity valuations [2][111] 5. **Economic Growth vs. Interest Rates**: The scenario of nominal economic growth exceeding nominal long-term interest rates (G > R) remains intact, which historically favors equities over bonds [2][103] Market Forecasts 1. **Index Projections**: - TOPIX is expected to reach 4,000 by the end of 2026, with further increases to 4,200 by the end of 2027 and 4,400 by the end of 2028 [2][116] - Nikkei 225 is projected to finish at 60,000 by the end of 2026, rising to 63,000 by the end of 2027 and 66,000 by the end of 2028 [2][116] 2. **Short-term Corrections**: Anticipated corrections to around 3,800 for TOPIX and 57,000 for Nikkei 225 in March and April as geopolitical tensions normalize [2][114] Sector Recommendations 1. **Preferred Sectors**: Focus on electrical appliances and machinery, with additional interest in information & communication, automobiles, and insurance [3] 2. **Avoidance**: Recommendations to avoid sectors such as steel, pharmaceuticals, and those linked to inbound tourism due to their sensitivity to crude oil prices [3] Crude Oil Price Sensitivity 1. **Impact on Earnings**: A 10% rise in crude oil prices is estimated to depress EPS at major companies by 1–1.25%, indicating a significant sensitivity of Japanese equities to oil price fluctuations [38][39] 2. **Historical Patterns**: Historical data shows that when the US economy grows post-oil price spikes, Japanese equities tend to gain, while they falter during recessions [9][10] Investor Behavior and Market Sentiment 1. **Investor Positioning**: There is a noted shift in investor focus towards supply-demand factors and positioning adjustments, with substantial inflows into Japanese equity funds despite recent market declines [58][72] 2. **Pension Fund Activity**: Selling pressure from pension funds has diminished, with increased inflows into equity investment trusts observed [72] Risks and Concerns 1. **Broader Economic Risks**: Concerns about US private credit, overinvestment in AI, and the potential decline of SaaS are highlighted as ongoing risks [78] 2. **Monetary Policy Implications**: The upcoming monetary policy meetings of central banks are expected to be influenced by the current economic climate and crude oil prices [87] Valuation Trends 1. **Valuation Adjustments**: The 12-month forward P/E for TOPIX has decreased from 18.5x to 16.8x, indicating a correction in valuations amid rising geopolitical tensions and oil prices [93] 2. **Future Valuation Outlook**: Expectations for P/E ratios to gradually decline to around 15–16x from 2027 onwards, reflecting a cautious market sentiment [115] This comprehensive analysis provides a detailed overview of the current state and future outlook of Japanese equities, emphasizing the interplay between geopolitical factors, economic growth, and market dynamics.

Core Insights - Micron Technology and Palantir Technologies are experiencing significant revenue and earnings growth driven by rising demand for their AI-related products [1] - Palantir's share price has increased by over 96% in the past year and 1,990% over the last three years, while Micron's stock is up 349% in the past year [2] - Both companies are facing valuation challenges despite their strong financial performance [5][11] Micron Technology - Micron's forward P/E ratio is 11.1, indicating potential value, with earnings per share expected to quadruple in the current fiscal year [5] - The surge in earnings is primarily due to increased demand for high-bandwidth memory (HBM) chips, leading to price spikes and higher profit margins [6][7] - Supply constraints are expected to persist through 2027, which may keep prices elevated in the short term [7] - Historical data suggests Micron's P/E ratio can drop to low single digits during peak earnings cycles, with expectations for the current cycle to last beyond 2028 [10] Palantir Technologies - Palantir's forward P/E ratio is notably high at 118, with a price-to-sales ratio of 90, reflecting expectations for continued high earnings growth [11] - The company reported a revenue growth of 70% last quarter and 56% for the full year, but its valuation implies that such growth must continue for years [11][12] - Analysts predict earnings per share growth exceeding 40% in 2027 and 2028, but the current valuation leaves little room for error [12] Alibaba Group - Alibaba is positioned as an underappreciated AI stock with a market cap around $320 billion, expected to grow significantly [3][16] - The company has faced a 78% year-over-year drop in adjusted EBITDA due to heavy investments in its retail and cloud computing sectors [17] - Despite challenges, Alibaba's cloud revenue grew by 34% last quarter, driven by the adoption of its AI products, with AI services growing at triple-digit rates [21] - Shares of Alibaba trade at 21 times forward earnings, presenting an attractive valuation for a company expected to recover and grow earnings at a solid double-digit pace [23]

March 9 (Reuters) - Anthropic filed a lawsuit on Monday to block the Pentagon from placing it on a national security blacklist, escalating the artificial ‌intelligence lab's high-stakes battle with the U.S. military over usage restrictions on its ‌technology. The AI startup's lawsuit against the U.S. government, President Donald Trump and Defense Secretary Pete Hegseth, among ​others, makes the following claims: FIRST AMENDMENT VIOLATION The startup claimed that the Pentagon retaliated against Anthrop ...

Core Argument - Anthropic has filed a lawsuit against the U.S. government, President Donald Trump, and Defense Secretary Pete Hegseth to block the Pentagon from placing it on a national security blacklist, claiming violations of constitutional rights and legal authority [1]. Group 1: First Amendment Violation - The company asserts that the Pentagon retaliated against it for protected activities, violating the First Amendment, which guarantees free speech rights [1]. - Anthropic claims it has the constitutional right to express its views on AI services and safety issues, and the government's blacklisting constitutes retaliation against its expressive activities [1]. Group 2: Presidential Action Beyond Legal Authority - The lawsuit argues that President Trump's directive to halt work with Anthropic, announced on his social media platform, exceeds his legal authority [1]. Group 3: Fifth Amendment Violations - Anthropic alleges that the U.S. government violated its Fifth Amendment rights by blacklisting the company without following necessary legal protocols [1]. - The lawsuit states that the government terminated contracts and blocked future work without prior notice or a chance to respond [1]. Group 4: Administrative Procedure Act Violation - The company claims that the Department of Defense's designation of it as a supply-chain risk violates the Administrative Procedure Act, which outlines required procedures for agency decisions [1]. - Anthropic argues that the decision by Defense Secretary Hegseth to label it a supply-chain risk overstepped authority and lacked proper legal procedures and supporting evidence [1].

Core Viewpoint - BigBear.AI Inc reported mixed financial results for Q4, with revenue falling short of analyst expectations but a smaller-than-expected loss per share [1][2]. Financial Performance - Q4 revenue was $27.3 million, missing analyst estimates of $33.31 million [1]. - The company reported a quarterly loss of $0.01 per share, which was better than the expected loss of $0.06 per share [1]. Future Outlook - BigBear.AI anticipates full-year 2026 revenue to be between $135 million and $165 million, compared to estimates of $164.29 million [2]. - CEO Kevin McAleenan emphasized the transformation of financial foundations to support future growth [2]. Stock Performance - Following the earnings announcement, BigBear.AI shares fell by 7.3% to $3.80 in pre-market trading [2]. Analyst Ratings - HC Wainwright & Co. analyst Scott Buck maintained a Buy rating but lowered the price target from $8 to $6 [3]. - Cantor Fitzgerald analyst Jonathan Ruykhaver maintained a Neutral rating and reduced the price target from $6 to $5 [3].

Summary of the Conference Call Transcript Industry Overview - **Industry**: Chinese Economy and Policy Outlook - **Event**: National People's Congress (NPC) convening on March 5th to set policy through 2030 Key Points and Arguments Economic Growth Targets - The NPC is expected to downgrade the GDP growth target for 2026 to "4.5-5%", marking the first downgrade in four years after achieving 5.0% growth in 2024 and 2025 [4][10] - This adjustment aligns with provincial trends, where 21 out of 31 provinces have lowered their targets, reflecting a weighted average drop from ~5.3% in 2025 to 5.0-5.1% in 2026 [10] - The 15th Five-Year Plan (FYP) is anticipated to also set a growth target in the same range, compatible with China's long-term goal of becoming a "moderately advanced economy" by 2035 [11][16] Employment and Labor Market - The NPC is likely to prioritize "employment-first" policies, maintaining targets of over 12 million new urban jobs and a surveyed unemployment rate of around 5.5% [18] - A record 12.7 million new graduates are expected to enter the job market, adding pressure to youth unemployment, which averaged 16.7% in 2025 [18][21] - Provinces are enhancing social security for gig economy workers, indicating a regulatory shift to protect this demographic [18] Inflation and Monetary Policy - The Consumer Price Index (CPI) target is expected to remain at "around 2%", with no explicit reflationary mandate anticipated [23][29] - A modest monetary policy adjustment is expected, including a 10 basis points (bps) cut in the policy rate and a 50 bps reduction in the Reserve Requirement Ratio (RRR) [46][48] Fiscal Policy and Investment - A fiscal stimulus package of approximately RMB 1 trillion is anticipated, focusing on social welfare and consumer support [44][55] - Local governments are becoming conservative in setting Fixed Asset Investment (FAI) targets, with only 14 provinces establishing numeric targets, down from 17 in 2025 [39] - The central government is expected to take a more prominent role in driving investment, particularly in new economy sectors [40] Consumption Rebalancing - The NPC aims to elevate consumer-led rebalancing as a strategic choice, although specific policy details remain vague [28] - Retail sales growth targets have been downgraded, reflecting a more realistic outlook following previous target misses [28][32] - Provinces are focusing on service consumption as a primary driver, with sectors like sports, tourism, and domestic services highlighted [35] Technology and Innovation - Continued emphasis on "new productive forces" with specific AI targets is expected, indicating a commitment to advancing technology and innovation [26][30] - Provinces are setting ambitious targets for AI sector growth, with some aiming for significant revenue increases in the coming years [30] Property Market - Housing policy is likely to remain under local government control, with support for property development models and market stabilization [45] - Recent easing measures in cities like Shanghai indicate a potential recovery in property sales if volumes pick up [52] Future Outlook - The post-NPC period is seen as a critical window for policy delivery, with consumer support and property market developments being key areas to watch [54] - The mid-year Politburo meeting will provide another opportunity for stimulus adjustments if growth falls short of targets [54] Additional Important Content - The NPC's focus on pragmatic policies reflects a shift towards addressing the K-shaped recovery in the economy, with an emphasis on labor markets, household income, and domestic demand [6][8] - The government's approach to managing economic volatility indicates a tolerance for fluctuations in growth performance, prioritizing stability over aggressive growth targets [5][10]

Mott Capital Management, an investment management company, released its Q4 2025 investor letter. A copy of the letter can be downloaded here. Stock markets paused in Q4, with the S&P 500 trading sideways from October to year-end. In 2025, the MCM Thematic Growth Strategy gained 11.98%, underperforming the S&P 500's 17.88%, despite some improvements. The AI boom boosted the S&P 500 in 2025. Concerns for AI and related companies include rising debt and the urgent need for R&D investments in advanced software ...