Macro News 1. On the afternoon of June 12, Premier Li Qiang met with European Central Bank President Christine Lagarde at the Great Hall of the People in Beijing. Li Qiang pointed out that China and Europe have strong economic complementarity, with China possessing a super-sized market advantage and continuously unleashing market potential. There is significant cooperation potential between China and Europe in many fields. China is willing to strengthen market connectivity and industrial synergy with Europe to add more momentum to their respective development. Lagarde stated that under the current international situation full of uncertainties, maintaining high-level exchanges and dialogue cooperation between Europe and China is crucial. Tariff wars and trade wars only lead to lose-lose outcomes, while adhering to multilateralism and strengthening open cooperation is the right choice. 2. On the afternoon of June 12, the Ministry of Commerce held a regular press conference. A reporter inquired about the first meeting of the China-US economic and trade consultation mechanism. Ministry of Commerce spokesperson He Yadong stated that from June 9 to 10 local time, the China-US economic and trade teams held the first meeting of the consultation mechanism in London, UK. The two sides reached a principled consensus on implementing the important consensus of the June 5 phone call between the two heads of state and the framework of measures to consolidate the outcomes of the Geneva economic and trade talks, making new progress in addressing each other's economic and trade concerns. Regarding the rare earth issue, as a responsible major country, China fully considers the reasonable needs and concerns of various countries in the private sector, reviews applications for export licenses of rare earth-related items in accordance with laws and regulations, has approved a certain number of compliant applications according to law, and will continue to strengthen the approval of compliant applications. 3. On June 11, People's Bank of China Governor Pan Gongsheng held the first annual meeting with European Central Bank President Christine Lagarde. The two sides exchanged in-depth views on topics including the economic and financial situations of China and Europe, reform of the international monetary system, global financial regulation, and key areas of cooperation between the two central banks. After the meeting, the two sides signed the Memorandum of Understanding on Cooperation between the People's Bank of China and the European Central Bank. 4. A passenger plane crashed at Ahmedabad Airport in Gujarat, India, on June 12. According to reports, all 242 people on board were killed. CCTV News learned that local police found one survivor in the Indian plane crash. 5. Foreign Ministry spokesperson Lin Jian presided over the regular press conference yesterday. A foreign media reporter asked about US President Trump's post on his social media platform, claiming that an agreement had been reached with China, such as China providing rare earth magnets. Lin Jian stated that China always honors its words with actions. Since a consensus has been reached, both sides should abide by it, and China hopes the US will work with China to implement the important consensus reached in the phone call between the two heads of state. Industry News 2. Recently, the People's Bank of China and the State Administration of Foreign Exchange jointly issued the "Several Measures on Financial Support for Fujian to Explore a New Path for Cross-Strait Integrated Development and Build a Demonstration Zone for Cross-Strait Integrated Development." TheThe "Several Measures" proposes 12 policy measures in four aspects: optimizing the financial ecosystem of the cross-strait shared "living circle", serving the construction of the first home for Taiwan compatriots and Taiwan-funded enterprises to land on the mainland, supporting the pilot program for high-level opening-up of cross-border trade in Fuzhou, Xiamen, and Quanzhou, supporting the facilitation of cross-border investment and financing under the capital account, comprehensively strengthening financial supervision, and effectively preventing and defusing financial risks. These measures are of great significance for continuously deepening the construction of a demonstration zone for cross-strait integrated development and promoting high-level financial opening-up. The People's Bank of China and the State Administration of Foreign Exchange will promote the detailed implementation of various policy measures outlined in the "Several Measures", further intensify financial support for the integrated development across the Taiwan Strait, and provide strong financial support for the construction of the demonstration zone for cross-strait integrated development. 3. At the Annual Meeting of the Asia Traders Forum & Stock Trading Summit 2025, Tim LUI, Chairman of the Securities and Futures Commission of Hong Kong, stated that the SFC is studying plans to adjust the number of shares per trading lot, thereby enhancing the convenience of trading high-priced stocks and odd lots, and further improving market liquidity. 4. The General Office of the People's Government of the Guangxi Zhuang Autonomous Region recently issued the "Implementation Plan for Special Actions to Boost Consumption in Guangxi". It mentions expanding support for trade-in policies for automobiles, home appliances, home improvement, kitchen and bathroom products, and e-bikes, as well as subsidies for purchasing new 3C digital products. 5. In 2025, Urumqi plans to develop 82 cultural and tourism projects with a total investment of 44.815 billion yuan and an annual planned investment of 5.4116 billion yuan, representing increases of 76%, 181%, and 170% respectively compared to 2024. The focus will be on introducing a batch of high-end hotel cluster projects, creating a number of major construction projects, and building a comprehensive cultural and tourism space integrating cultural experiences, commercial consumption, and leisure and entertainment. 6. With the "Suzhou Super League" gaining widespread popularity, some netizens have called on Sichuan to host similar football events through the "Ask the Government Sichuan" platform. In response, the Sichuan Provincial Sports Bureau stated that the "Bashu Xiongqi Cup" Sichuan Super League will learn from the healthy development experience of the "Suzhou Super League", improve the event system, strengthen supervision, promote fair competition, mobilize social forces to participate, facilitate the development of mass football and campus football, and support nationwide fitness. Company News 1. New China Life Insurance announced its intention to subscribe for private equity fund shares with an investment not exceeding 15 billion yuan. 2. China Vanke Co., Ltd. announced that it sold a total of 72.96 million A-share treasury shares from June 10 to June 12, which will help supplement the company's working capital. 3. *ST Gongzhi announced that the Shenzhen Stock Exchange has decided to terminate the listing of the company's shares. 4. Yidian Technology stated on an interactive platform that POP MART is an important client of the company. 5. ST Jinyi announced that the other risk warnings for the company's shares have been revoked, and trading will resume from June 16. 6. Xiaofang Pharmaceutical announced a collaboration with Shanghai Dermatology Hospital to develop Compound Platycladi Tincture, a Class 1.1 traditional Chinese medicine for treating hair loss. 7. PowerChina secured a 10.77 billion yuan offshore wind power EPC turnkey project. 8. Qingmu Technology clarified that it currently only provides e-commerce agency operation services for Pop Mart's Tmall flagship store. 9. Taiji Co., Ltd. disclosed that its controlling shareholder and actual controller are planning matters related to changes in company control, leading to a trading suspension. 10. Hengbao Co., Ltd. announced that director and vice president Gao Qiang plans to sell no more than 197,500 shares. 11. Jingjin Equipment reported that its actual controller, chairman, and general manager has been placed under retention. 12. Feiliner completed verification work, with its shares resuming trading on June 13. Global Markets US and European stocks showed mixed performance, with both the S&P 500 and Dow Jones hitting at least three-month closing highs. US stocks opened lower but closed higher, with all three major indices posting slight gains. The S&P 500 rose 0.38%, the Dow gained 0.24%, and the Nasdaq advanced 0.24%. The S&P 500 reached its highest closing level since late February, while the Dow achieved its best close since early March. Oracle surged over 13% to a record high after exceeding Q4 earnings expectations. US fintech firm Chime jumped over 37% on its debut. Boeing fell nearly 5% following an Air India Boeing 787 crash. European indices closed mixed, with Germany's DAX30 down 0.48%. International crude oil futures settled slightly lower. WTI July crude dropped 0.16%, while Brent August crude declined 0.59%. COMEX gold futures rose 0.84% to $3,406.8/oz, and silver futures gained 0.41% to $36.41/oz. Investment Opportunities 1. Pop Mart Expanded Capacity Early This Year, But Demand Far Exceeds Supply Chain Response Media reports indicate that since Chinese New Year, Pop Mart has urgently recalled workers and expanded capacity to meet surging demand driven by rising IP popularity. An insider described this as a "sweet trouble" where market demand vastly outpaces supply chain responsiveness, noting "even overworked sewing machines can't keep up." The core appeal of IP collectibles lies in instant emotional gratification. Labubu's distinctive features meet specific demands, amplified through social media. Current supply shortages and product scarcity further elevate circulation premiums, significantly boosting visibility. Zhongtai Securities released a research report stating that it is optimistic about the investment value of the IP industry and anticipates the growth and commercialization of major IPs. Three directions are worth noting: (1) Leading companies in the IP2C model for trendy toys that possess a high-quality IP matrix, strong operational capabilities, and channel strength; (2) Content producers with strong content creation capabilities; (3) IP operators in the IP2B2C model that possess high-quality IPs and B-end customer resources. 2. German nuclear fusion startup ProximaFusion secures record-breaking funding On Wednesday local time, German nuclear fusion startup ProximaFusion announced that it had raised €130 million (equivalent to $148 million) in a record-breaking funding round. Investors have high hopes that the company will be the first to build the world's first commercial nuclear fusion power plant. ProximaFusion's Series A funding round was co-led by CherryVentures and BaldertonCapital, marking the largest private nuclear fusion investment round in Europe to date. In recent years, market interest in nuclear fusion technology has continued to grow. Founder Securities' machinery equipment team is optimistic that the timeline for global nuclear fusion could be advanced. Currently, the European Commission (EC) has officially launched a four-week consultation period, which will help the EU establish a leading position in global nuclear fusion development and accelerate the commercialization of fusion energy. 3. Cumulative financing exceeds 1 billion yuan in the first half of the year; experts say commercial space is experiencing unprecedented development opportunities Media reports indicate that China's commercial space industry in 2025 is accelerating at an unprecedented pace towards industrialization. One of the most telling signs is the "real money" coming from the capital market. According to incomplete statistics by reporters, in the first five months of this year alone, the publicly disclosed and estimable financing amounts in China's commercial space sector have cumulatively exceeded 1 billion yuan. Recently, there have been continuous developments in the commercial space sector. LandSpace Technology Corporation's independently developed ZQ-2 Modification 2 remote sensing launch vehicle successfully started production and lifted off; Beijing CAS Space Technology Co., Ltd.'s KQ-1 remote sensing 7 launch vehicle was successfully launched; and the "Tada Hu Yang No. 1" satellite was successfully launched by the KQ-1 remote sensing 7 launch vehicle. Experts interviewed stated that after several years of cultivation, China's commercial space industry is flourishing, with enterprises in commercial satellites, commercial rockets, commercial monitoring and control, and other sectors emerging like bamboo shoots after a spring rain. The commercialization of the entire industry chain is being prioritized, and the industry chain ecosystem is continuously improving. With the synergy of policies, technology, and the market, commercial space is experiencing unprecedented development opportunities. 4. AI development brings significant changes to the industry, continuously expanding the space for the industry chain Institutions have pointed out that switching networks are the "blood vessels" of AIDC. Since entering the era of large models, as the scale of clusters has accelerated its expansion, the interconnection requirements between computing cards have rapidly increased. As the hardware core supporting the interconnection network, the industry chain space for switches has been continuously expanding. Guojin Securities believes that domestic large models are rapidly advancing from a scale of hundreds of billions of parameters to trillion and ten trillion parameters, and 800G switches will become an important driver for the rapid growth of the industry. Dell'Oro Group predicts that by 2025, the adoption rate of 800G switch ports is expected to exceed that of 400G data center switch ports, accounting for more than 25% of data center switch ports. The development of the AI industry has brought about significant changes to the switch industry. Along with the development of the domestic AI industry, domestic high-speed switches for training-side applications and domestic medium-speed switches for inference-side applications are on the verge of mass production. CPO, OCS, white-box switches, etc., are expected to become strategic highlands in the domestic switch industry, and enterprises with relevant layouts are worthy of close attention.

The US job market and inflation have both cooled down. In the US, initial jobless claims last week were higher than expected, while continuing claims surged to the highest level since the end of 2021. The US May PPI rose 0.1% MoM, a mild increase that fell short of expectations, adding new evidence of "further slowdown in inflation". Traders have once again fully priced in expectations for two US Fed interest rate cuts this year, with the first cut potentially occurring in September. Following the data release, the US dollar index and US Treasury yields fell sharply, with the US dollar touching a three-year low, spot gold rising, and US stock futures paring losses. Market attention will now turn to the $22 billion auction of 30-year US Treasuries to observe whether investors will shy away from such long-term bonds amid a backdrop of expanding fiscal deficits. Below are the trends of core assets: The three major US stock indices fell slightly, with the Dow Jones Industrial Average down 0.36%, the S&P 500 down 0.2%, and the Nasdaq down 0.2%. European stocks rebounded slightly in tandem with US stocks. German stocks are now down about 0.8%, after earlier falling more than 1.3%. South Korean stocks have risen for seven consecutive sessions. Israel's TA-35 index once fell about 1.7%, marking its biggest drop in two months. The US dollar index once fell more than 1%, the euro rose more than 1.2%, the British pound rose about 0.5%, and the yen appreciated about 1%. US Treasury yields fell across the board, with the 2-year and 10-year yields once falling more than 8 basis points. Spot gold extended gains to more than 1%, while spot silver nearly erased earlier losses of more than 1.7%. Both US crude and Brent crude fell more than 1.6%. US inflation remained mild in May, indicating that current tariffs have not significantly pushed up consumer prices. The market generally expects the US Fed to keep interest rates unchanged at its meeting next week, waiting to observe the impact of Trump's policies on the economy. In the stock market, after the release of PPI and employment data, US stock futures pared losses in pre-market trading. At the start of US trading, the three major indices fell slightly, with the Dow Jones Industrial Average down 0.36%, the S&P 500 down 0.2%, and the Nasdaq down 0.2%. After the S&P 500 rebounded more than 20% from its April low, trading activity in the stock market began to show signs of fatigue. Most Chinese concept stocks fell, with Bilibili down about 1%. Most tech stocks also fell, with Tesla down about 1%. CureVac rose about 35% after reports that BioNTech would acquire the biotech company for $1.25 billion to boost its cancer business. Oracle's shares rose 8.2% to their highest level since January 22. Boeing's shares fell by approximately 5% following the first air crash involving a Boeing 787 aircraft. In the foreign exchange market, the US dollar index fell below 98, dropping more than 1% to a three-year low after the PPI release, before narrowing its losses to less than 0.8%. Following the PPI data, the euro surged more than 1.2% at one point and is now up over 0.8%. The UK economy experienced its most severe contraction in 18 months, with expectations for an interest rate cut soaring. The British pound fell by approximately 0.2% at one point. After the PPI data release, it rose more than 0.5% at one point and is now up about 0.4%. In the bond market, US Treasury yields plummeted significantly. After the PPI data release, yields on both 2-year and 10-year US Treasuries fell more than 8 basis points at one point. In the commodities market, spot gold surged more than 1.1% after the PPI data release, before narrowing its gains to less than 0.9%. Spot silver turned positive, having previously fallen approximately 1.7%, and is now down about 0.2%. Both WTI and Brent crude are now down more than 1.5%. Catalyzed by news of US-Iran tensions, oil prices surged 5% on Wednesday, only to pull back on Thursday. According to Global Times , Iran has threatened to attack US military bases, and the US expects Iran to retaliate against certain US military bases in Iraq. Oman has confirmed that the sixth round of US-Iran nuclear talks will be held on Sunday.

Many Wall Street strategists believe that as the economic outlook for Europe improves, European stock markets are poised for their best annual performance relative to the US market in two decades. According to the average forecast of 20 strategists surveyed by the media, the STOXX Europe 600 Index is expected to climb to around 554 points this year. As of Monday's (May 19) close, the STOXX 600 Index stood at 549 points, implying a potential further climb of about 1% for the year. Notably, the index has already risen by more than 8% year-to-date. In contrast, strategists are far less optimistic about the outlook for the US market. Another media survey found that strategists, on average, forecast the S&P 500 Index to close at 6,001 points this year, basically flat with its Monday closing price, while the index has only risen by 1.6% year-to-date. Among them, JPMorgan Chase has set a target of 580 points for the STOXX 600 Index, one of the highest targets in the survey. Citigroup, on the other hand, expects the index to rise by 4% to 570 points this year as analysts' pessimism about corporate earnings eases. Both banks predict that the US benchmark index will decline for the remainder of the year. Citigroup strategist Beata Manthey, commenting on European stock markets, said, "We have moved past earnings uncertainty, which could lay the groundwork for further gains and potential re-rating, especially in those hard-hit cyclical sectors." Shift in European Stock Market Forecasts This forecast also marks a shift from expectations at the beginning of the year, when strategists anticipated that European stock markets would significantly lag behind the US market. However, as Germany's historic fiscal reforms and strong corporate earnings attracted investors seeking substitutes for US assets, sentiment towards European benchmark indices has rebounded. A survey released by Bank of America a week ago showed that 35% of global fund managers are currently overweight European stocks, while net exposure to US stocks has fallen to its lowest level in two years. According to data compiled by the media, earnings for MSCI Europe constituents grew by 5.3% in Q1, far exceeding analysts' expectations of a 1.5% decline. Underlying Concerns Admittedly, the STOXX 600 Index's year-to-date gain of over 8% has also sparked concerns about its valuation. The benchmark index currently trades at a price-to-earnings ratio of about 14.6 times, above the 20-year median of 13.5 times, though still below the S&P 500 Index's P/E ratio of nearly 22 times. Of course, some investment bank strategists in the aforementioned surveys remain hesitant about the outlook for European stocks. For example, Societe Generale strategist Roland Kaloyan said he needs to see stronger earnings trends and a further reduction in tariff-related risks before betting on further gains for the Stoxx 600. His year-end target is 530, which implies a 3.5% decline from Monday's closing price. "Uncertainty around tariffs further complicates the outlook, as many companies are reluctant to provide clear guidance, suggesting that the full impact of these tariffs may not yet be reflected in earnings forecasts," Kaloyan said. UBS strategist Gerry Fowler, on the other hand, said that with expectations for stronger economic growth over the next two years, valuations have risen as expected. "To achieve further growth, we must navigate a period of uncertainty that could keep corporate earnings-per-share growth at or slightly below zero this year," he said.

Macro News 1. On May 15, the State Council convened a meeting to advance the work of strengthening the domestic economic cycle. Li Qiang, Member of the Standing Committee of the Political Bureau of the CPC Central Committee and Premier of the State Council, emphasized at the meeting that the strategic focus of development should be placed on strengthening the domestic economic cycle, leveraging its inherent stability and long-term growth potential to hedge against uncertainties in the international cycle, thereby promoting steady and sustained economic growth in China and striving to achieve high-quality development. Li Qiang pointed out that a domestic demand-driven and internally circulated economy is a unique advantage of a major economy. Efforts should be made to prioritize strengthening the domestic economic cycle in accelerating the construction of a new development paradigm. 2. The General Offices of the CPC Central Committee and the State Council issued the "Opinions on Continuously Advancing the Urban Renewal Initiative." The Opinions propose advancing the renovation and transformation of old urban residential communities, steadily promoting the transformation of hazardous housing, accelerating the demolition and reconstruction of Category D hazardous housing, strengthening the renovation of urban infrastructure, advancing the construction of new-type urban infrastructure, supporting the implementation of the urban renewal initiative with central fiscal funds, and encouraging various types of financial institutions to actively participate in urban renewal on the premise of legal compliance, risk controllability, and commercial sustainability. 3. China has decided to expand the scope of visa-free countries. From June 1, 2025, to May 31, 2026, a visa-free policy will be implemented on a trial basis for holders of ordinary passports from Brazil, Argentina, Chile, Peru, and Uruguay. Holders of ordinary passports from these five countries who come to China for business, tourism, visiting relatives and friends, exchange visits, or transit for no more than 30 days may enter the country without a visa. 4. The Ministry of Commerce held a regular press conference yesterday afternoon. Spokesperson He Yongqian stated that China will release relevant information on China-US economic and trade consultations in a timely manner. Regarding the US's Section 232 tariffs on imported automobiles, steel, and aluminum, as well as the initiation of a Section 232 investigation on imported pharmaceuticals, He Yongqian stated that China urges the US to cease the Section 232 tariff measures as soon as possible and properly address the concerns of all parties through equal dialogue. 5. The People's Bank of China, the Hong Kong Securities and Futures Commission, and the Hong Kong Monetary Authority plan to further enrich the product types under the "Swap Connect" initiative. This includes extending the maturity of contracts, extending the maturity of interest rate swap contracts to 30 years, and expanding the product spectrum by introducing interest rate swap contracts referencing the Loan Prime Rate (LPR). Industry News 1. A recent announcement by the Bureau of Industry and Security under the US Department of Commerce indicates that the use of Huawei's Ascend chips anywhere in the world violates US export controls. Spokesperson He Yongqian of the Ministry of Commerce stated that the US has abused export control measures, imposing unjustified restrictions on Chinese chip products, seriously undermining the legitimate rights and interests of Chinese enterprises. China urges the United States to immediately correct its erroneous practices and will take resolute measures to safeguard the legitimate rights and interests of Chinese enterprises. 2. On May 15, Li Lecheng, Minister of Industry and Information Technology, presided over the 14th Manufacturing Enterprise Symposium, focusing on accelerating the high-quality development of the industrial mother machine industry and listening to the situation briefings, suggestions, and opinions from industrial mother machine enterprises. Li Lecheng emphasized the need to attach great importance to the construction of the industrial ecosystem, avoiding "cut-throat competition" and homogeneous development. It is essential to leverage the leading role of industry leaders, establish closer industry-university-research-application cooperation, strengthen the alignment between production and demand, and promote the integrated development of large, medium, and small-sized enterprises. 3. The Supreme People's Court and the China Securities Regulatory Commission (CSRC) jointly issued the "Guiding Opinions on Strict and Fair Law Enforcement and Judicial Services to Support the High-Quality Development of the Capital Market." The opinions propose the regular implementation of representative litigation for securities disputes to facilitate investors in safeguarding their legitimate rights and interests in accordance with the law. The opinions also mention that for "small essays" that harm the rights and interests of others and constitute a crime, criminal responsibility will be pursued in accordance with the law. 4. The CSRC issued the "Regulatory Rules on the Supervision of Raised Funds by Publicly Listed Firms." Among other things, it proposes overall requirements for the use of raised funds, emphasizing that they should be used exclusively for their intended purposes and for the main business. It clarifies that the final use of excess raised funds should be for ongoing and new projects, share buybacks and cancellations, and should not be used for permanent replenishment of working capital or repayment of bank loans. 5. At Alibaba's earnings analyst conference call, Wu Yongming, CEO of Alibaba Group, stated that in fiscal year 2026, the company will continue to focus on the growth of its core businesses in e-commerce and AI+cloud, and, with a medium and long-term perspective, shape a second growth curve driven by technology. 6. On May 15, the People's Bank of China (PBOC), the Ministry of Science and Technology, the National Financial Regulatory Administration, and the China Securities Regulatory Commission jointly held a meeting to promote exchanges and advances in science and technology finance. Pan Gongsheng, Governor of the PBOC, Yin Hejun, Minister of Science and Technology, Xiao Yuanqi, Deputy Governor of the National Financial Regulatory Administration, and Li Ming, Vice Chairman of the China Securities Regulatory Commission, attended the meeting and delivered speeches. The meeting emphasized comprehensive support for technological innovation, with a strong focus on early-stage, small-scale, long-term, and hard-core technology investments. 7. The IEA's monthly report indicates that global supply is expected to significantly exceed demand growth in 2025, with oil inventories increasing by approximately 720,000 barrels per day. The global supply growth forecast for 2025 has been revised up to 1.6 million barrels per day, an increase of 380,000 barrels per day from the previous month's report, due to a more optimistic outlook for Saudi Arabia's production. Corporate News 1. China National Chemical Engineering announced that its subsidiary, Saiding Ningbo, is involved in a lawsuit regarding securities misrepresentation liability disputes with Kangde Xin. 2. Alibaba's earnings report shows that in the fourth fiscal quarter (ending March 31), revenue was 236.45 billion yuan, up 7% YoY; adjusted net profit was 29.85 billion yuan, a year-on-year increase of 22%. 3. ST Huijin announced that it has applied for the removal of other risk warnings. 4. Hengrui Medicine announced that it has completed its share repurchase program, with a total expenditure of approximately 600 million yuan. 5. Daye shares announced that as of now, its production site in Mexico is still in the trial operation phase. 6. Chengdi Xiangjiang announced that its wholly-owned subsidiary has signed an EPC general contracting contract worth 1.632 billion yuan for the China Mobile machine room building project. 7. Jingyuan Environmental Protection announced that its wholly-owned subsidiary has signed a contracting contract worth 365 million yuan for a computing power cluster construction project. 8. Xinhuajin announced that the company and its related parties may face the risk of administrative penalties from the China Securities Regulatory Commission or disciplinary actions from the stock exchange. 9. AVIC Xi'an Aircraft Industry (Group) Co., Ltd. stated at an investor relations event that the delivery volume of C919 aircraft parts has significantly increased. 10. Zowee Technology announced that 12.48% of the company's shares held by its controlling shareholder and actual controller, Xia Chuanwu, will be auctioned off by the court. Global Markets 1. On Thursday, US stocks closed with mixed results. The Dow Jones Industrial Average rose 0.65%, the S&P 500 index rose 0.41%, and the Nasdaq index fell 0.18%. Popular Chinese ADRs generally declined, with the Nasdaq Golden Dragon China Index closing down 2.37%. Alibaba and WeRide fell more than 7%, while JD.com, Baidu, and NIO fell more than 3%. NetEase surged over 14% as its Q1 revenue exceeded expectations, with its share price approaching an all-time high. European stocks closed higher across the board, with the German DAX index rising 0.72%, the UK FTSE 100 index rising 0.57%, and the French CAC 40 index rising 0.21%. 2. In commodities, WTI crude oil futures for June delivery fell 2.42% to close at $61.62 per barrel, while Brent crude oil futures for July delivery fell 2.36% to close at $64.53 per barrel. 3. International precious metal futures generally closed higher. COMEX gold futures rose 1.74% to close at $3,243.90 per ounce, while COMEX silver futures rose 1.07% to close at $32.79 per ounce. Investment Opportunities Reference 1. Jieyue Xingchen Open-Sources 3D Large Model Step1X-3D According to media reports, Jieyue Xingchen officially released and open-sourced its 3D large model, Step1X-3D, with a total parameter count of 4.8B (1.3B for the geometric module and 3.5B for the texture module), capable of generating high-fidelity, controllable 3D content. The capabilities of domestic large models continue to improve at the application level, and the demand for computing power continues to strengthen. According to CIO estimates, China's AI computing power expenditure will grow from $18 billion in 2024 to $90 billion in 2029. Yongxing Securities believes that the continuous improvement of underlying computing capabilities will drive the continuous enhancement of large model capabilities, and the computing power industry chain will continue to benefit. 2. Computing Power Takes to the Skies! "Three-Body Computing Constellation" Successfully Launched Recently, the Long March 2D carrier rocket took off from the Jiuquan Satellite Launch Center and successfully placed the space computing satellite constellation into its predetermined orbit, marking a complete success for the launch mission. This signifies that China's first whole-orbit interconnected space computing constellation has officially entered the networking phase. The launch of twelve computing satellites in a single rocket is the first launch of the "Three-Body Computing Constellation" led by the Zhejiang Lab, a new-type R&D institution in Zhejiang Province, and also the first launch under the Nationalstar Aerospace's "Star Computing" plan. According to Wang Jian, an academician of the Chinese Academy of Engineering and director of the Zhejiang Lab, the "Three-Body Computing Constellation" is a space computing infrastructure on a thousand-satellite scale jointly built by the Zhejiang Lab in collaboration with global partners, with a total computing power of up to 1000 POPS (100 quadrillion operations per second) upon completion. The Three-Body Constellation enables whole-orbit satellite interconnection and is equipped with an 8-billion-parameter space-based model, capable of on-orbit processing of L0-L4 level satellite data. According to calculations by Yu Menglun, an expert in China's aerospace flight mechanics and rocket trajectory design, to achieve cost parity between space-based solar power generation and ground-based solar power generation, the transportation cost of rockets must be reduced to at least 1,000 yuan per kilogram. Therefore, the deployment of computing power in space will further drive the development of China's domestic commercial aerospace industry. 3. WeChat Establishes E-commerce Product Department to Explore New In-App Transaction Models According to media reports, Tencent recently issued a company-wide letter announcing adjustments to its WXG business group. The main changes include: establishing an e-commerce product department responsible for exploring in-app transaction models within WeChat, accelerating the development of transaction infrastructure and ecosystem, and operating new in-app transaction models; renaming the Open Platform Infrastructure Department to the Open Platform Department, which will be responsible for the planning, R&D, and operation of WeChat official accounts and Mini Programs. AI e-commerce is reshaping the traditional e-commerce ecosystem through functions such as intelligent product selection, AI shopping guides, and personalized recommendations. Guojin Securities stated that the current e-commerce retail industry has entered a mature stage, making it difficult to achieve rapid growth in terms of scale. Therefore, the focus is on whether new technologies like AI can bring about improvements in monetization efficiency and cost optimization. It is recommended to pay attention to leading retail and internet companies. 4. The Third Biotechnology Revolution: The Demand for Industrial Implementation Continues to Grow Stronger According to media reports, the use of synthetic biology to transform microorganisms into "super factories" for the efficient synthesis and green manufacturing of new substances and materials has become an important driver for promoting the development of new quality productive forces in cutting-edge regions. Facing this new industrial frontier, Qingdao has achieved a seamless connection from source innovation to industrial application, taking the lead in development. Synthetic biology is regarded as the third biotechnology revolution following the "discovery of the DNA double helix structure" and the "Human Genome Project," and it stands at the forefront of the global biotechnology field. Hua'an Securities pointed out that as the demand for the implementation of the bio-manufacturing industry continues to grow stronger, new programmatic documents are expected to emerge, further guiding the development of the industry and achieving a healthy value cycle in the synthetic biology sector. On the other hand, through machine learning models and algorithms, AI can analyze vast amounts of data and model and simulate biological systems within a short period, thereby rapidly evaluating design plans and experimental conditions, predicting and optimizing R&D results, and reducing the blindness and repetitiveness of experiments. With the continuous development of domestic AI technology, it will provide strong support for research in synthetic biology.

Macro News 1. At a regular press conference held by the Foreign Ministry yesterday, spokesperson Jia Kun Guo responded to Trump's statement about potentially "significantly reducing" tariffs on China, stating that China's stance on the tariff war initiated by the US is clear: we do not wish to fight, nor are we afraid to fight. If it comes to a fight, we will see it through; if it comes to talks, our door is open. Jia Kun Guo emphasized that if the US truly wants to resolve issues through dialogue and negotiation, it should stop threatening and coercing, and engage in dialogue with China on the basis of equality, respect, and mutual benefit. 2. A spokesperson for the National Health Commission stated that a recent article titled "Lab Leak: The True Origin of the Coronavirus" published on the White House website, like previous attempts by the US to revive the claim of a "Wuhan lab leak," has no scientific basis. The so-called "evidence" is entirely fabricated. Currently, more and more clues and evidence point to the coronavirus appearing earlier in the US, and the next step in tracing its origin should be conducted in the US. China urges the US to immediately stop smearing and attacking China, face its own problems, and provide a serious and responsible explanation to the people of the world and the international community. 3. Wang Xin, Director of the Research Bureau of the People's Bank of China, said yesterday that the recently released "Action Plan for Further Enhancing Cross-border Financial Services in Shanghai International Financial Center" will improve the cross-border fund allocation of the full-function capital pool in the Shanghai Free Trade Zone. It encourages banks to gradually achieve automated processing of cross-border payments, extend service hours for key enterprise groups' cross-border capital pools, and enable real-time global fund allocation. 4. The Shanghai Municipal Bureau of Statistics released the economic performance of Shanghai in Q1 2025: According to the unified regional GDP calculation, the city achieved a regional GDP of 1.273506 trillion yuan in Q1, up 5.1% YoY at constant prices. Industry News 1. Cailian reporters learned at the 2025 Shanghai Auto Show that CATL launched a new chocolate battery swapping model yesterday. Yang Jun, General Manager of CATL's battery swapping business, introduced on-site that the chocolate battery swapping models include multiple car models from FAW, Changan, BAIC, GAC, and others. 2. Hong Kong Chief Executive John Lee posted on the 23rd that he and his team visited the Hangzhou Future Science and Technology City Exhibition Hall to learn about Hangzhou's development in smart cities and artificial intelligence. Representatives from six innovative technology companies—DeepSeek, Unitree, Game Science, Kujiale, Cloudwalk, and StrongBrain—introduced their developments and features in large language models, robotics, AI, game development, and brain-computer interfaces. 3. The General Administration of Customs announced that, according to Chinese laws and regulations and the "Protocol on Quarantine and Health Requirements for Bovine Bezoar Exported from Argentina to China" between the General Administration of Customs of the People's Republic of China and the Ministry of Economy of the Argentine Republic, qualified Argentine bovine bezoar can now be imported. 4. After US President Donald Trump issued a stern warning of retaliation, the EU imposed relatively mild fines on Apple and Meta, totaling 700 million euros, for violating new antitrust rules targeting large tech companies. 5. The Xiamen Municipal Government updated its policy on housing compensation through housing vouchers, allowing the purchase of second-hand homes across the city and offering additional rewards for buying new homes within six months. 6. The People's Bank of China updated its list of "Revoked License Institutions," with Shandong Feiyin Payment Information Technology Co., Ltd. officially revoking its payment license, becoming the fifth institution to revoke its license this year. As of April 22, the central bank has cumulatively revoked 101 third-party payment licenses, reducing the number of licensed payment institutions to 170. 7. Baoding City released 20 measures to support the high-quality development of online micro-short dramas, aiming to launch over 150 high-quality micro-short dramas, nurture 30 or more scaled micro-short drama enterprises, and establish two micro-short drama bases by 2027. 8. The 2025 National Cultural and Tourism Consumption Promotion Activity was launched in Zhengzhou, Henan. From April 2025 to March 2026, the Ministry of Culture and Tourism will focus on boosting cultural and tourism consumption, holding special events around Labor Day, summer vacation, National Day, and the Chinese New Year, and introducing distinctive cultural and tourism activities and benefits. Company News 1. *ST Jiyao announced that its stock will be delisted and trading will be suspended starting today. 2. Tianqi Lithium announced that it expects a net profit of 82 million to 123 million yuan in Q1, turning a profit from a loss. 3. Asia Potash announced that its Q1 net profit increased by 374% YoY. 4. Kingsoft Office announced that its Q1 net profit increased by 9.75% YoY. 5. Haitaike reported a Q1 net profit increase of 5,739% YoY. 6. Transsion Holdings released its annual report, with a 0.22% increase in net profit in 2024, and proposed a dividend of 15 yuan per 10 shares. 7. Wens Food announced a Q1 net profit of 2.001 billion yuan, turning a profit from a loss. 8. Zhongxin Fluoromaterials announced that it has a DFBP capacity of 5,000 tons/year, but the impact on future annual performance remains highly uncertain. 9. Quectel Wireless Solutions announced that its 2024 net profit increased by 548% YoY, thanks to the growth in vehicle modules, 5G modules, edge computing modules, and Wi-Fi modules. 10. Hongda New Materials announced that it will be subject to other risk warnings starting April 25, and its stock name will change to "ST Hongda." 11. NavInfo announced that it has signed a strategic cooperation framework agreement with ByteDance's Volcano Engine. 12. Visionox announced that it plans to invest 5 billion yuan in setting up a global new display industry innovation center project in Kunshan. 13. Inlyte announced that it intends to purchase 77.9385% of Uteri's shares, and the stock will resume trading. 14. Lansi Technology released its Q1 report, with a 135% increase in net profit. 15. Tuopu Group announced that its 2024 net profit increased by 39.52% YoY, and proposed a dividend of 5.19 yuan per 10 shares. Global Markets 1. US stocks closed significantly higher on Wednesday, with the Dow Jones rising 1.07%, the Nasdaq up 2.50%, and the S&P 500 increasing 1.67%. Popular Chinese stocks performed strongly, with the NASDAQ Golden Dragon Index closing up 2.93%. European stocks also closed higher, with the German DAX30 index up 3.14% to 21,961.97, the UK FTSE 100 up 0.90% to 8,403.18, and the French CAC40 up 2.13% to 7,482.36. 2. OPEC+ plans to accelerate production increases, putting pressure on oil prices. On Wednesday, international oil prices fell sharply, with WTI June crude futures down 2.20% to $62.27 per barrel, and Brent June crude futures down 1.96% to $66.12 per barrel. International precious metals futures closed mixed, with COMEX gold futures down 3.45% to $3,301.50 per ounce, and COMEX silver futures up 2.01% to $33.88 per ounce. Investment Opportunities 1. Huawei releases KunADS 4, with institutions predicting the intelligent driving market size to exceed 1.2 trillion yuan by 2030. According to media reports, on April 22, Zhiyu Jin, CEO of Huawei's Intelligent Automotive Solution BU, announced the official release of the new generation of Huawei Kun ADS 4, bringing comprehensive upgrades in architecture, safety, and experience. Zhiyu Jin also stated that 22 cooperative models have been launched so far, covering mid-to-high-end models priced above 150,000 yuan, including pure electric, extended-range, hybrid, and fuel types. Institutions predict that the market size of intelligent driving could exceed 1.2 trillion yuan by 2030. Sinolink Securities believes that L2+ intelligent systems will accelerate penetration in the market below 150,000 yuan, and the penetration rate of urban NOA in mid-to-high-end models is expected to continue to rise. Future intelligent driving will further penetrate, and competition among automakers will intensify, leading to a winner-takes-all trend. It is recommended to pay attention to investment opportunities in the intelligent driving industry chain and the commercialization progress of ADAS. 2. ByteDance's Volcano Engine releases multiple tools, with Huawei, Google, and NVIDIA all making moves. Recently, Volcano Engine launched the AgentDevops system and AI data lake services in Shenzhen, helping enterprises with the development and operation of intelligent agents. The HiAgent platform of Volcano Engine released the Agent Devops system, providing full lifecycle management from strategy planning, capability development, effect evaluation, application release, online monitoring to effect optimization, ensuring that the agent effects meet production standards. Huaxi Securities stated that the development of intelligent agents in China is currently in an upward phase, with multiple agents already in use; competition is intense, with many vendors participating; the development direction of intelligent agents is diversified, covering both general and specialized fields; and the coverage includes mobile and computer ends, spanning various operating systems. Guotai Junan Securities stated that AIAgents are new digital labor, capable of assisting or replacing humans in tasks. NVIDIA's AgenticAI building blocks, NIM pre-trained models, and Nemo frameworks help organizations easily develop and deploy AI Agents. According to NVIDIA estimates, the total number of global knowledge workers is 1 billion, and AIAgents are expected to become a multi-trillion-dollar business opportunity. 3. Meituan's self-developed fourth-generation drone passes CAAC review, obtaining the first nationwide low-altitude logistics full-coverage operation certificate. Meituan's self-developed fourth-generation drone has passed the CAAC review and obtained the first nationwide low-altitude logistics full-coverage operation certificate. After certification, Meituan drones can start routine commercial operations across the country, becoming the first low-altitude operator approved by the CAAC to conduct logistics transportation throughout China. Official information shows that Meituan's fourth-generation drone is a new multi-rotor model focused on urban low-altitude logistics delivery. As of the end of 2024, Meituan drones have opened 53 routes, with a cumulative delivery of over 450,000 orders. Zhang Shiyue of LeadLeo Research Institute believes that with the continuous expansion of delivery demand, policy promotion, empowerment of intelligent technology, and the rapid development of the low-altitude economy, the Chinese logistics drone market will achieve rapid growth, with an estimated market size of nearly 150 billion yuan by 2030, with a compound annual growth rate of 57.0%. 4. MIIT accelerates the formulation of standards for intelligent logistics and other intelligent equipment. According to media reports, the Ministry of Industry and Information Technology and the Standardization Administration of China issued the 2024 version of the National Intelligent Manufacturing Standard System Construction Guide, which mentions that by 2026, more than 100 national and industry standards will be revised, building an intelligent manufacturing standard system adapted to the new industrialization development. Accelerate the formulation of standards for intelligent detection, intelligent logistics, and other intelligent equipment, R&D design, production manufacturing, and other industrial software, intelligent design, intelligent management, and other smart factory standards, supply chain construction, supply chain operation, and other smart supply chain standards, digital twin equipment, industrial application of artificial intelligence, industrial data circulation, and other intelligent enabling technology standards, network collaborative manufacturing, integrated production and sales operations, and other new intelligent manufacturing model standards, industrial wireless networks, industrial network integration, and other industrial network standards. Explore new methods for standard development, solidify successful experiences and innovative results, form typical scenario system solution standards, guide enterprises to apply standards in practice, build an enterprise intelligent manufacturing standard system, and promote high-quality development of intelligent manufacturing. According to CIC Burning Consulting, the market size of China's smart logistics equipment is expected to reach 192.02 billion yuan by 2027. Zhongtai Securities stated that the penetration rate of smart logistics equipment in China is still less than 30%, significantly lower than the approximately 80% penetration rate in developed countries. Additionally, the number of automated warehouses in China is fewer than in the US and Japan, with automated warehouses reducing costs by 20% compared to traditional warehouses. The penetration rate of smart logistics equipment is expected to increase rapidly in the future. It is recommended to focus on leading domestic logistics system integrators.

As global capital continues to flee US dollar assets, where have investors turned in panic? The most obvious winners in the global capital markets on Friday provide the answer: the euro, Swiss franc, Japanese yen, gold... During the Asian session on Friday, as the US dollar index fell further after breaching the 100 mark, the frenzied sell-off of US Treasuries continued to escalate in a week marked by the brutal conclusion of global tit-for-tat tariff policies. These policies have heightened fears of a deep economic recession and significantly shaken investor confidence in US assets. Currently, the yield on the 10-year US Treasury has once again risen to the high of 4.45% touched on Wednesday, with a weekly increase of about 45 basis points, the largest since 2001. The rapid rise in US Treasury yields has been attributed by many analysts to large-scale asset sell-offs, as hedge funds and other asset management companies offloaded bonds due to margin calls and losses. There is even market speculation that foreign investors may be selling US Treasuries. An increasing number of analysts and investors have also pointed out that the significant sell-off of US Treasuries and the weakness of the US dollar this week indicate a loss of confidence in the US, the world's largest economy. "Clearly, US assets are flowing out. Simultaneous declines in the currency and bond markets are never a good sign," said Kyle Rodda, senior financial market analyst at Capital.com. "This goes beyond the impact of slowing economic growth and trade uncertainty." Chris Weston, head of research at Pepperstone, also noted, "A clear 'sell America' sentiment has spread across the market, with traditional safe-haven assets being favored, and the US dollar losing its safe-haven appeal." Nomura strategist Naka Matsuzawa pointed out, "Investors now lack confidence in the US, which deeply concerns me—this is not only a vote of no confidence from US stock investors but also from US Treasury market participants in the Trump administration and its policies." "The Strongest" Euro From the perspective of the foreign exchange market, it is not surprising that investors have turned to the Swiss franc and the Japanese yen, two major safe-haven currencies, as the US dollar weakened significantly in a risk-off environment—especially the Swiss franc. During Friday's session, the US dollar fell to a 10-year low of 0.8141 against the Swiss franc, while the US dollar fell to a six-month low of 142.87 against the Japanese yen. Renowned economist Peter Schiff couldn't help but lament, "I have never seen such a large-scale sell-off of US assets. The US dollar, bonds, and stocks have all been hit hard. I don't remember the US dollar ever falling 3.5% against the Swiss franc in a single day. The US's ride on the global tailwind is about to come to an abrupt halt. Buckle up." But in fact, in the foreign exchange market, the currency that dealt the most severe blow to the US dollar on Friday, or benefited the most from this round of US dollar capital outflows, was not these two safe-haven currencies—it was the euro. Historical statistics show that since the euro's inception at the end of the last century, the euro has rarely been this strong against the US dollar... (The euro's intraday gain against the US dollar ranked first among major currency pairs) Market data shows that the euro rose to a high of 1.1386 against the US dollar during the session, and has surged by more than 300 points since Thursday. Similar sustained gains may have only occurred during the 2008 global financial crisis. At the same time, for the euro, the shift in strength may no longer be confined to the level of foreign exchange speculation. In the bond market, a phenomenon that has never occurred since the euro's inception is that—the extent to which German bonds have outperformed US bonds over the past five trading days has never been so large, with the premium of the 10-year US Treasury yield over German bond yields continuously widening. In fact, in the recent global bond market sell-off triggered by the plunge in US Treasuries, European first-tier national bonds represented by German and French bonds have remained relatively resilient. This is clearly related to their strong historical safe-haven appeal. When investors believe that US Treasuries may face risks due to basis trade blow-ups, German bonds, the common "second safe-haven" in the bond market, naturally become a substitute option for many. An interesting point is that, from the perspective of the interest rate differential commonly seen in the foreign exchange market, the widening of the yield spread between US Treasuries and German bonds should itself be unfavorable to the euro. However, when capital flees the US en masse for Europe due to panic over Trump's policies, the traditional interest rate differential logic seems not difficult to break. Considering that European stocks have been one of the leading performers in the global stock market this year, the recent outperformance of European stock, bond, and currency markets over the US market undoubtedly means that European assets have "feasted" while US assets have "fallen"... This also raises a future question: Can the euro, with Trump's "recklessness," completely reverse its fate and shake off the slump of the past decade? Nomura strategist Dominic Bunning recently stated, "The euro may be the primary beneficiary of a slowdown or reversal in US market capital inflows, as these inflows mainly come from eurozone investors," adding that the eurozone may undergo "structural restructuring," supporting the euro's appreciation. "The Strongest" Gold Of course, while the foreign exchange market is "abandoning the US for Europe," a theme that has remained unchanged in the global market over the past few years still holds: buy gold. Driven by safe-haven inflows, spot gold hit a new all-time high during the Asian session on Friday, reaching a high of $3,220 per ounce. On Wednesday and Thursday, gold prices had just experienced their largest two-day gains since the COVID-19 lockdowns. Joseph Brusuelas, chief economist at tax consulting firm RSM, said, "The root of the global market shock lies in Trump's trade policies. Confidence in the credibility of the US system has been lost, and the behavior of the entire financial market reflects this." Liu Yuxuan, a precious metals researcher at Guotai Junan Futures, pointed out, "Gold is currently the best investment in the market. Unprecedented trade tensions have deepened distrust in the US dollar, thereby increasing demand for other safe assets." Valerie Noel, head of trading at Swiss private bank Bank Syz, had said before the suspension of Trump's tariffs, "I think some countries are closely watching (US tariff policies) and may accelerate the diversification of investments away from US assets." Looking at the reserve situation of various central banks recently, increasing gold reserves has been a major trend for central banks to achieve asset diversification. Trump's tariff policies and the recent turmoil in the US Treasury market are likely to further accelerate this shift in asset allocation. Data updated earlier this week by the PBOC shows that as of the end of March 2025, China's gold reserves stood at 73.7 million ounces, an increase of 90,000 ounces from the previous month. This is the fifth consecutive month of gold reserve increases by the PBOC since last November. Renowned economist Peter Schiff had also expressed strong support for gold's prospects on Thursday. He pointed out, "The deteriorating US economic conditions and stagflation prospects have created an attractive environment for gold investment. Given the strength of gold prices and the decline in oil prices, gold mining companies may also benefit."

During the Qingming holiday, major events in the financial markets piled up. The Tariff Commission of the State Council announced a 34% tariff hike on all imports originating from the US. US job additions in March far exceeded expectations, but the impact of reciprocal tariffs is expected to emerge soon. Powell stated that the scale of tariffs is larger than expected, potentially stimulating inflation and slowing growth, and it remains uncertain how to respond. OPEC advanced its production increase plan, with a more significant production boost in May. The US reciprocal tariff policy triggered a massive shock in global financial markets. Wall Street stocks in the US plummeted for two consecutive days, with the Nasdaq confirming a bear market and the Dow Jones Industrial Average entering correction territory. European stocks plunged, with the benchmark STOXX 600 and Germany's DAX indices confirming corrections. Japanese stocks fell to their lowest since August last year, with a weekly decline of 9%, the largest weekly drop in five years. The US dollar index fell to a six-month low as investors weighed the impact of US tariffs on global trade and the economy. In commodities, affected by tariffs and OPEC's production increase, oil prices hit a new low in over three years. LME copper hit an eight-month low, as the US comprehensive tariff plan sparked fears of an economic recession. CBOT soybeans touched the year's lowest, impacted by comprehensive tariffs. Gold failed to stay immune, with investors selling gold to cover losses from the stock market crash. ICE cotton fell to a four-year low, pressured by export concerns. The CRB index, tracking global commodities, fell over 3% on Thursday and another 5% on Friday, with a weekly cumulative drop of 6%. **US Stocks Continue to Plunge** As reciprocal tariffs continued to ferment, US stocks plunged for two consecutive trading days during the Qingming holiday. US benchmark indices plummeted on Thursday, marking the largest single-day percentage drop in years, as the US comprehensive tariff policy sparked fears of a full-blown trade war and a global economic recession. The Dow fell 3.98%, the S&P 500 dropped 4.84%, and the Nasdaq plunged 5.97%. S&P 500 component stocks lost a combined $2.4 trillion in market value, with the index recording its largest single-day percentage drop since June 2020. The Dow also saw its largest single-day drop since June 2020, while the Nasdaq marked its largest single-day decline since March 2020, when the COVID-19 pandemic sent global markets into a slump. Wall Street stocks fell for the second consecutive day on Friday, with the Nasdaq confirming a bear market and the Dow entering correction territory, as the escalation of the global trade war triggered the largest sell-off since the COVID-19 pandemic. The S&P 500 fell 5.97%, the Nasdaq dropped 5.82%, and the Dow plunged 5.5%. Over Thursday and Friday, the Dow fell 9.3%, the S&P 500 dropped 10.5%, and the Nasdaq declined 11.4%. **US Dollar Index Hits Six-Month Low** The US dollar index hit a six-month low during the Qingming holiday, with reciprocal tariffs causing significant volatility. On Thursday, the dollar plunged 1.9%, its worst performance since November 2022. The harsher-than-expected tariffs shocked the market, with global stocks falling and investors flocking to safer assets such as low-risk currencies, bonds, and gold, fearing that a full-blown trade dispute could trigger a sharp global economic slowdown and exacerbate inflation. The dollar rebounded nearly 1% on Friday after Fed Chairman Powell acknowledged that the impact of US tariffs was larger than expected and struck a cautious tone on future policy easing. The dollar showed little reaction to US data overall, with US service sector activity slowing to a nine-month low in March due to tariff-induced uncertainty. US non-farm payrolls added 228,000 in March, far exceeding the expected 135,000, while February's increase was revised down to 117,000. The unemployment rate rose from 4.1% to 4.2%. **Gold Fails to Stay Immune** As reciprocal tariffs continued to impact the market, commodities plunged across the board, and gold failed to stay immune, falling for two consecutive days as the intensifying trade war sparked fears of a global economic recession, with investors selling gold to cover losses from the broader market crash. Fed Chairman Powell stated on Friday that the scale of the new US tariffs is "larger than expected," and the economic impact, including rising inflation and slowing growth, could also be greater. He also warned that it is too early to know what the right response from the Fed should be. The US economy added far more jobs than expected in March, but comprehensive import tariffs could weaken the resilience of the labour market in the coming months amid declining business confidence and stock market sell-offs. The US Bureau of Labor Statistics reported that non-farm payrolls added 228,000 in March, compared to an expected 135,000. The unemployment rate rose to 4.2%. Average hourly wages rose 0.3% MoM and 3.8% YoY. After the jobs report, the market expects the Fed to wait until June to start cutting interest rates. Data from the US Commodity Futures Trading Commission (CFTC) showed that as of April 1, speculators reduced their net long positions in COMEX gold futures and options by 16,134 contracts to 176,553. During the week, speculators reduced their net long positions in COMEX silver futures and options by 4,356 contracts to 41,449. **CBOT Soybeans Hit Year's Lowest** CBOT soybeans hit the year's lowest during the Qingming holiday. On April 4, the Tariff Commission of the State Council announced a 34% tariff hike on all imports originating from the US. The most-traded soybean contract fell below the $10 mark, hitting its lowest since December 19. The US Department of Agriculture (USDA) export sales report released on Thursday showed that for the week ending March 27, US soybean export sales for the current market year increased by 410,200 mt, up 21% from the previous week but down 9% from the four-week average. Market estimates were for an increase of 250,000-800,000 mt. Among them, exports to mainland China increased by 208,700 mt. Data from the US Commodity Futures Trading Commission (CFTC) on Friday showed that large speculators increased their net short positions in CBOT corn and wheat futures and options last week while reducing their net short positions in soybean futures and options. As of April 1, large speculators reduced their net short positions in CBOT soybean futures and options by 12,322 contracts to 42,140. **Oil Prices Hit Three-Year Low** Affected by tariffs and OPEC's production increase, oil prices continued to plunge during the Qingming holiday. On Thursday, oil prices fell over 6%, marking the largest drop in three years, and on Friday, they fell 7%, hitting a new low in over three years. Oil prices fell sharply on Thursday, marking the largest single-day drop since 2022, a day after the US announced comprehensive new import tariffs, as OPEC unexpectedly agreed to increase production. Brent crude futures fell $4.81, or 6.42%, on Thursday. US crude futures fell $4.76, or 6.64%. Brent crude was set to record its largest drop since August 1, 2022, while US crude was set to record its largest drop since July 11, 2022. Eight OPEC countries agreed on Thursday to advance their oil production increase plan, with oil production in May increasing by 411,000 barrels per day, higher than the originally planned 135,000 barrels per day. This unexpected decision extended the already steep decline in oil prices. Oil prices fell 7% on Friday, hitting the lowest closing level in over three years, as the global trade war escalated sharply, with investors fearing an economic recession. Brent crude futures fell $4.56, or 6.5%, settling at $65.58 per barrel; US crude futures fell $4.96, or 7.4%, settling at $61.99. Earlier in the session, Brent crude futures hit a low of $64.03, and US crude futures hit a low of $60.45, both four-year lows. In percentage terms, Brent crude recorded its largest weekly drop in a year and a half, while US crude recorded its largest weekly drop in two years. **LME Copper Hits Eight-Month Low** As the US comprehensive tariff plan sparked fears of an economic recession, base metals saw a massive sell-off during the Qingming holiday. LME three-month copper fell 3.3% on Thursday, after hitting a low of $9,353, the lowest since March 4. On Friday, it fell 6.4%, earlier hitting a low of $8,734, the lowest since August 8. In the past 15 years, copper has only seen larger daily drops in March 2020 and during the European debt crisis in October 2011. Aluminum hit a seven-month low, falling for the 12th consecutive trading day. Nickel hit a low of $14,595, the lowest since October 2020. Zinc hit an eight-month low, while lead hit its lowest since October 2022. As tariff hikes hit global growth expectations, copper consumption prospects, and risk appetite, Citi expects copper prices to pull back to $8,500 by Q3. BNP Paribas believes copper prices will fall to this level in Q2. Data from the US Commodity Futures Trading Commission (CFTC) showed that as of April 1, speculators reduced their net long positions in COMEX copper futures and options by 2,352 contracts to 31,274. **Powell Says Tariff Scale Larger Than Expected May Stimulate Inflation and Slow Growth, Uncertain How to Respond** Fed Chairman Powell stated on Friday that the scale of Trump's new tariffs is "larger than expected," and the economic impact, including rising inflation and slowing growth, could also be greater. He also warned that it is too early to know what the right response from the Fed should be. "We face a highly uncertain outlook, with risks of rising unemployment and inflation," he said, adding that the Fed has time to wait for more data before deciding how monetary policy should respond. **US Job Additions Far Exceed Expectations in March, but Trump Tariff Impact Expected to Emerge Soon** The US economy added far more jobs than expected in March, but comprehensive import tariffs could weaken the resilience of the labour market in the coming months amid declining business confidence and stock market sell-offs. The US Bureau of Labor Statistics reported that non-farm payrolls added 228,000 in March, compared to an expected 135,000. The unemployment rate rose to 4.2%. Average hourly wages rose 0.3% MoM and 3.8% YoY. After the jobs report, the market expects the Fed to wait until June to start cutting interest rates. **OPEC Advances Production Increase Plan, May Output to See Larger Boost** Eight OPEC countries agreed on Thursday to advance their oil production increase plan, with oil production in May increasing by 411,000 barrels per day. The Organization of the Petroleum Exporting Countries (OPEC) said in a statement: "This includes the originally planned May increase, as well as a two-month increase." This week, attention remains on US and China data, with the Fed releasing meeting minutes on Wednesday. On Thursday, China will release March CPI and PPI data, while US March CPI will also be released. On Thursday, the agricultural market will see the USDA's April supply and demand report. On Friday, the US will release March PPI data.

【Futures Market】During the night session, SHFE copper jumped initially and then pulled back. On Monday morning, it fell below the 80,000 mark, rebounded in the afternoon, but weakened again at the close. The most-traded May contract closed at 79,950, down 0.92%, with a slight decrease in total trading volume and a reduction of over 9,000 in open interest. SHFE aluminum followed a similar trading pattern, with the most-traded May contract closing at 20,480, down 0.63%, and a slight decrease in total trading volume, while open interest remained largely unchanged. Meanwhile, alumina hit a new low in this round of adjustments, with the most-traded May contract closing at 2,936, down 3.61%. 【Analysis】This week is a super week, with important economic data from both China and the US, such as China's manufacturing PMI released this morning and the US non-farm payrolls and unemployment rate data released over the weekend. On April 2, the market will also focus on whether the US will implement "reciprocal tariffs." On Friday, US stocks fell sharply, and on Monday morning, Asian stocks also dropped significantly, followed by European stocks in the afternoon. The market is concerned that if the US implements "reciprocal tariffs," it could trigger a tariff war, posing a major challenge to the global economy. Today, gold hit a new historical high, and the gold-to-copper ratio reached a new high, reflecting strong market risk aversion sentiment. It is recommended to adopt a defensive strategy in recent operations, waiting for the "shoe to drop." 【Valuation】Copper is neutral to slightly high, aluminum is neutral. 【Risk】Macro policies fall short of expectations.

Overnight, LME copper opened at $8,968/mt.

Overnight, LME lead opened at $2,064/mt.