中国金融业 - 追踪行业风险，反内卷努力逐步且明确的进展愈发清晰-China Financials-Tracking industrial risks more clear evidence of gradual but definitive progress on anti-involution efforts

Summary of Key Points from the Conference Call Industry Overview - Industry Focus: China Financials, specifically the manufacturing sector and industrial risks in Asia Pacific [1][6][8] Core Insights and Arguments - Capital Expenditure (Capex) Trends: In September, 20 sectors experienced a slowdown in fixed asset investment (FAI) growth, compared to 16 sectors in August. This trend is attributed to continued moderation in FAI growth, which has helped close the gap between manufacturing FAI and industrial production (IP) [2][8] - Profit Growth: Manufacturing profit growth improved to 9.9% year-over-year (YoY) in September from 7.4% in August. Year-to-date (YTD) industrial profit increased by 3.2% YoY, up from 0.9% in August. This indicates a shift from expansion to moderation in industrial credit risks [4][8] - Anti-Involution Efforts: The ongoing anti-involution efforts in China are believed to have contained intense price competition in certain sectors, leading to improved profit margins. The moderation in industrial liability growth is linked to these efforts and a gradual reduction in funding support since the first half of 2024 [3][4] - Manufacturing FAI Growth: YTD manufacturing FAI growth declined to 4.0% YoY in September from 5.1% in August, contributing to the closure of the gap between manufacturing FAI and IP [8][10] Additional Important Insights - Sector Performance: In September, 76.6% of sectors (in terms of liabilities) saw a slowdown in capex growth compared to the first half of 2024. Additionally, 39.5% of manufacturing sectors reported better profit trends [9][8] - Producer Price Index (PPI): The PPI remained flat month-over-month in September, with the YoY decline narrowing to 2.3% from 2.9% in August [8] - Loan Growth: Medium- to long-term loan growth for industrial firms moderated to 9.7% YoY, while industrial firms' liability growth decreased to 5.2% YoY [8] Conclusion - The overall sentiment in the China financials sector is cautiously optimistic, with signs of gradual improvement in profit growth and a controlled approach to credit supply and investment. The anti-involution measures are playing a significant role in stabilizing the market dynamics and reducing risks associated with overcapacity and credit [3][4][6]