Morning News

**Source**: Wall Street Journal

### Market Overview

- US economic data boosted the expectation of interest rate cuts, and the S&P 500 index recorded four consecutive days of gains. Meta postponed the release of its AI model, which dragged down the Nasdaq index, ending its six - day winning streak. Meta's stock price dropped by more than 2%, and it, together with Nvidia and Tesla, saw their first decline this week. UnitedHealth Group's stock price plummeted again, falling nearly 11%. The China stock index fell by more than 2%, with Alibaba's stock price dropping by more than 7% and JD.com's falling nearly 4%.

- The yield on the 10 - year US Treasury bond plunged by more than 10 basis points intraday, and then surged briefly after Powell's speech. After the release of US retail data, the US dollar index approached its daily low.

- Gold prices turned around and rose nearly 2% after reaching a one - month low. Due to the cooling of tensions in the Middle East, US oil prices once fell by more than 4%.

- During the Asian trading session, A - shares collectively declined. The ChiNext Index closed down nearly 2%, rare earth and gold sectors showed a divergent trend, the Hang Seng Tech Index fell by more than 1%, and technology stocks generally declined.

### Key News

- Powell: The "key parts" of the 2020 monetary policy framework will be reassessed. Long - term interest rates are likely to rise, and "supply shocks" may become the new normal. The "New Fed News Agency": The Federal Reserve will adjust the interest rate - setting framework and admit that the era of long - term low interest rates may have ended.

- The year - on - year growth rate of the US PPI in April was 2.4%, lower than expected, and the month - on - month growth rate was - 0.5%, the largest decline in five years. The month - on - month growth rate of US retail sales in April was 0.1%, slightly exceeding expectations, and signs of weak consumer spending emerged.

- Trump signed a $200 - billion commercial agreement with the UAE to cooperate in building a 5 - GW data center in the UAE. The details of the "Trump package" in Qatar were further revealed: The sovereign wealth fund plans to invest $500 billion in the US over ten years.

- Alibaba's revenue in the fourth quarter increased by 7% year - on - year, falling short of expectations. The growth rate of Alibaba Cloud accelerated to 18%, and AI - related revenue has recorded three - digit growth for seven consecutive quarters. According to the conference call, the growth of the cloud business is mainly driven by AI demand, and it will remain on an upward trend in the next few quarters. Alibaba will convert more Taobao users into instant retail users.

- Liang Wenfeng participated in the publication of a retrospective paper: DeepSeek revealed the expansion plan behind the V3 model for the first time.

- Meta will postpone the release of its flagship AI model Behemoth, and its stock price fell by more than 3% intraday. Meta's dilemma may indicate that the progress of future AI models may be much slower than before and at a very high cost.

- CoreWeave received a 7% stake from Nvidia and will provide $4 billion worth of cloud computing capacity to OpenAI.

- Berkshire Hathaway sharply cut its bank stock holdings in the first quarter, sold all its Citigroup shares, kept its Apple holdings unchanged, doubled its holdings in a beer manufacturer, and has some confidential holdings.

- Iran said it is willing to reach an agreement with the US. An advisor to Iran's supreme leader said that Iran is willing to promise never to build nuclear weapons in exchange for the US lifting sanctions. A Hamas official said that if a permanent cease - fire is achieved, the control of the Gaza Strip can be handed over.

- Walmart's sales in the first quarter increased by 2.5%, slightly lower than expected, and its CFO warned that the increase in tariff prices may start from this month.

### Market Closing Report

- European and US stock markets: The Dow Jones Industrial Average rose 0.65%, the S&P 500 Index rose 0.41%, and the Nasdaq Composite Index fell 0.18%. The European STOXX 600 Index closed up 0.56%.

- A - shares: The Shanghai Composite Index fell 0.68%, the Shenzhen Component Index fell 1.62%, and the ChiNext Index fell 1.92%.

- Bond market: The yield on the 10 - year US Treasury bond fell 8.91 basis points to 4.4472%. The yield on the two - year US Treasury bond fell 8.79 basis points to 3.9629%.

- Commodities: COMEX gold futures rose 1.66% to $3,241.10 per ounce. WTI June crude oil futures closed down 2.42% to $61.62 per barrel. Brent July crude oil futures closed down 2.36% to $64.53 per barrel.

### Detailed Key News  

#### Global Highlights  

**Powell: To reassess "key parts" of the 2020 monetary policy framework, with long-term interest rates likely to rise and "supply shocks" becoming the new norm.**  

The "key parts" include the treatment of inflation targets and employment "gaps." Powell said higher real interest rates may reflect the possibility that future inflation could be more volatile than during the 2010s lull, adding that "supply shocks" will be "more frequent and potentially more prolonged," posing a difficult challenge for economies and central banks.  

**"New Fed News Agency": Fed to adjust rate-setting framework, acknowledging the end of the long-term low-rate era.**  

Nick Timiraos noted that facing a world where ultra-low rates are no longer certain, Powell is steering a new strategy. The Fed’s upcoming adjustment to its rate-setting framework is unlikely to impact current policy decisions but acknowledges that the era of "long-term low rates" may have ended. This review reflects on the shortcomings of the 2020 framework—particularly its failure to adapt to a broad range of economic scenarios, even those that initially seemed improbable. The review is expected to retain the Fed’s core framework principles, including the 2% inflation target and the critical task of ensuring the public’s belief that the Fed will maintain low and stable inflation.  

**U.S. April PPI rose 2.4% YoY, below expectations, with a 0.5% MoM decline—the largest drop in five years.**  

The unexpected 0.5% monthly decline in April PPI, the steepest in five years, was primarily due to falling corporate profit margins. This suggests businesses are absorbing part of the tariff impact rather than passing all costs to consumers.  

**U.S. retail sales rose 0.1% MoM in April, slightly exceeding expectations, with signs of weakening consumer spending.**  

U.S. retail sales barely grew in April, indicating consumers are cutting back amid rising prices and tariff concerns. Seven of the 13 reported merchandise categories saw sales declines, with sporting goods, gas stations, and apparel hardest hit.  

**Trump signs $200B commercial deal with UAE to build 5GW data center in Abu Dhabi.**  

The planned 5GW U.S.-UAE AI data center will be the largest AI park outside the U.S., with multiple American firms participating in operations and cloud services. The White House announced the deal includes a $14.5B order for 28 Boeing planes by Etihad Airways; a $60B oil and gas expansion project; a gallium project involving Raytheon; a $10B Holtec nuclear reactor project with committed investment; an AI, data center, and industrial IoT engineering center with Qualcomm; and a public cloud service project with Amazon.  

**Qatar’s "Trump package" further revealed: Sovereign wealth fund plans $500B U.S. investment over a decade.**  

This proposed additional investment nearly matches the current total size of the Qatar Investment Authority (QIA). QIA’s CEO said investments will focus on AI, data centers, and healthcare, shifting from small-risk ventures to prioritizing larger-scale transactions; U.S. investments will not involve divestment from other countries but rather increased exposure to the U.S.  

**Currying favor with Trump! Can Middle Eastern tycoons really afford the "trillions"?**  

There is a stark gap between Gulf countries’ economic and fiscal capacity and the massive figures they have pledged. Saudi Arabia’s GDP is just over $1 trillion, Qatar’s is only around $200B, and oil price volatility may further threaten the fulfillment of these commitments.  

**Alibaba’s Q4 revenue rose 7% YoY, missing expectations; Alibaba Cloud accelerated 18% growth, with AI revenue achieving triple-digit growth for seven consecutive quarters.**  

In its earnings call, the company said cloud business growth was primarily driven by AI demand, which will remain in an upward trend in the coming quarters, and it will convert more Taobao users to instant retail users.  

Alibaba’s Q4 revenue was ¥236.45B ($32.4B), up 7% YoY. Among them, Taotian revenue grew 9% YoY, 88VIP memberships continued double-digit growth, Alibaba Cloud’s quarterly revenue achieved its fastest growth in three years, and AI revenue saw triple-digit growth for seven consecutive quarters. Local Services revenue rose 10% YoY, while Cainiao revenue fell 12% YoY.  

During the earnings call, Alibaba stated that Alibaba Cloud’s revenue growth rate will continue to rise in the coming quarters, and the surge in inference demand has not yet been fully reflected in this earnings report, with customer demand driven by inference continuing to grow steadily. The focus of instant retail is to convert more Taobao users into instant retail users and then upgrade the business model. Additionally, full-site promotion + software service fees will drive incremental growth for a considerable period.  

**Liang Wenfeng co-publishes retrospective paper: DeepSeek reveals expansion plan behind V3 model for the first time.**  

DeepSeek suggests future hardware should improve accumulation precision (e.g., FP32) or support configurable accumulation precision; meanwhile, Tensor Cores should natively support fine-grained quantization, directly receive scaling factors, and perform matrix multiplication with group scaling to avoid frequent data movement. NVIDIA’s Blackwell microscaling data format exemplifies this direction.  

**Meta delays flagship AI model Behemoth launch, with shares falling over 3% intraday.**  

Media reports indicate Meta has delayed the launch of its flagship AI model Behemoth, originally planned for April, then postponed to June, with the latest projection pushing it to fall 2025 or later. This has sparked internal concerns about the direction of its multi-billion-dollar AI investments. Meta’s dilemma highlights the challenges top companies face in launching next-gen AI models, suggesting future AI model progress may be much slower and cost-prohibitive.  

**CoreWeave receives 7% stake from NVIDIA, to supply $4B cloud computing capacity to OpenAI.**  

Data center builder CoreWeave has signed a $4B agreement with AI firm OpenAI to provide additional cloud computing capacity through 2029. Following news of the renewed collaboration, CoreWeave’s stock price rose as much as 8% on Thursday. After hours, NVIDIA disclosed a 7% stake in CoreWeave, up from the previously believed 5.2%.  

**Berkshire slashes bank stocks in Q1, exits Citigroup, keeps Apple holdings unchanged, doubles beer maker stake, and has confidential holdings.**  

13F filings show Buffett’s Berkshire exited Citigroup in Q1 and reduced holdings in Bank of America and Capital One Financial; the largest purchase was beer maker Constellation Brands, with holdings increasing by over 113%. Berkshire also requested confidentiality from the SEC, seeking to withhold disclosure of one or more stock investments in its 13-F report. Analysts note that if the new confidential holding is a single stock, its size is relatively small (around $1B-$2B), and the new investment likely falls under Berkshire’s "business and industry" stock portfolio.  

**Iran says willing to strike deal with U.S., oil prices plummet 3%!**  

Trump said on the 15th that a deal with Iran is "very close," according to reports.  

**Senior advisor to Iran’s Supreme Leader: Iran willing to promise never to build nuclear weapons in exchange for U.S. sanctions relief.**  

Against the backdrop of multiple U.S.-Iran talks, a senior advisor to Supreme Leader Khamenei told U.S. media on the 14th that Iran is prepared to sign a nuclear agreement with Trump under certain conditions to secure sanctions relief, per The Paper.  

**Hamas official: Will hand over Gaza control if permanent ceasefire is achieved.**  

On the 15th local time, Hamas senior official Bassem Naim told media that Hamas is in direct talks with the U.S. to end the Gaza conflict. Naim added that Hamas could hand over control of the Gaza Strip if a permanent ceasefire is reached, per CCTV News.  

**Shadow of the Mar-a-Lago agreement! After the New Taiwan Dollar, is the Korean Won next?**  

Nomura believes the Korean won is one of the most undervalued currencies in emerging markets and G10, overall undervalued by ~12%. Under sustained U.S. pressure, investors should closely monitor U.S.-South Korea forex consultations and the upcoming "July economic and trade plan," preparing for a potential rapid decline in USD/KRW to 1,300.  

#### Domestic Macro  

**Li Qiang: Making the domestic circulation stronger is a strategic move to ensure stable economic growth.**  

Li Qiang emphasized the need to consolidate the foundation for a stronger domestic circulation by promoting sustained economic improvement. This includes accurately and effectively supporting foreign trade enterprises, stabilizing employment through all means, tapping potential to boost consumption, expanding effective investment, and supporting localities in creating more development highlights. Development and security must be coordinated to maintain social stability.  

**He Lifeng co-chairs 10th China-France High-Level Economic and Financial Dialogue with Lombard.**  

During the dialogue, both sides held in-depth exchanges on multiple issues and signed China-France cooperation documents on poultry and breeding poultry/eggs. After the meeting, He Lifeng and Lombard jointly attended a China-France business forum and delivered speeches.  

**China’s central bank and four agencies: Comprehensively support technological innovation, focusing on early-stage, small-scale, long-term, and hard-tech investments.**  

The meeting stressed implementing policy measures to build a sci-tech finance system, exploring mechanisms compatible with technological innovation, and providing all-around support for tech innovation—prioritizing early-stage, small-scale, long-term, and hard-tech investments. Accelerate the implementation of re-lending policies for tech innovation and transformation, and incentivize financial institutions to expand first-time loans to tech firms and equipment renewal loans.  

**CSRC: Adhere to "pursuing key culprits," strictly and swiftly punish illegal share减持, and focus on cracking down on insider trading, market manipulation, and other violations.**  

Chen Huaping said the next step is to implement measures, strengthen alignment between fund companies’ interests and investors’, address issues like funds’ "guaranteed profits," enrich products compatible with retail investors’ risk tolerance, and provide high-quality services for household wealth management.  

**U.S. tightens chip exports to China with new rules that are "old wine in new bottles."**  

According to Global Times, a U.S. Commerce Department statement on the 13th said using Huawei’s Ascend chips anywhere globally violates U.S. export controls and plans to warn the public about risks of allowing U.S. AI chips for Chinese AI model development. Sources said the Commerce Department is drafting new plans that may shift to negotiating separate agreements with countries.  

**Goldman Sachs raises China stock targets twice in a week: CSI 300 has 17% upside.**  

Goldman Sachs adjusted its 12-month targets for Chinese equities to pre-April 2 levels, with MSCI China and CSI 300 targets at 84 and 4,600 points, implying 11% and 17% upside, respectively. Earlier, Goldman economists raised GDP growth forecasts for the U.S. and China.  

**China Merchants Securities: Reassess A-shares, CSI 300 market cap has 22%-61% upside potential.**  

China Merchants Securities argues that against the backdrop of falling risk-free rates, the narrowing spread between bank dividend yields/non-financial construction free cash flow yields and risk-free rates will drive valuation upgrades. The theoretical increase in CSI 300’s total market cap is expected to be 22%-61%, driven by massive household investable funds, state-owned capital purchases, insurance fund demand, public fund allocation needs, and potential foreign inflows.  

#### Domestic Companies  

**Xiaomi’s self-developed mobile chip announced: Lei Jun reveals late-May launch, a decade-long "chip-making" breakthrough.**  

Following Apple, Samsung, and Huawei, Xiaomi becomes the fourth global mobile brand with self-developed SoCs. Industry experts view the launch of Xiaomi’s SoC chip Xuanjie O1 as a milestone in China’s semiconductor self-sufficiency. People’s Daily commented: "Amid complex international environments and fierce core technology competition, it is crucial for private entrepreneurs to maintain the fighting spirit of 'no pain, no gain.'"  

**NetEase’s Q1 gaming revenue up 12% YoY, net profit ¥10.3B (+34.9% YoY).**  

NetEase’s Q1 2025 revenue rose >7% YoY, with gross profit up 8.6% YoY. The gaming business shone, with revenue up 12.1% YoY, driven by global surging popularity of new titles like *Marvel Duel*, *Justice*, *Boundary Break*, and *Once Human*, and a rebound of Blizzard games in China. Subsidiary Youdao achieved a record-high quarterly operating profit of ¥104M, continuing its profit trend. CEO Ding Lei said continuous innovation and high-quality content were the core growth drivers in Q1. NetEase’s pre-market shares rose >3%.  

**Largest Hong Kong pharma IPO in five years: Hengrui Medicine launches Hong Kong global offering.**  

**Geely Auto’s Q1 revenue and net profit hit new highs, with explosive new energy growth.**  

#### Overseas Macro  

**U.S. stocks rebound quickly, but Goldman Sachs warns: Limited short-term upside, higher pullback risks, and all early-year issues persist.**  

Goldman Sachs notes that while positive tariff negotiation signals have restored market confidence, risks remain uneliminated. The Trump administration’s effective tariff levels remain far higher than pre-April 2 "reciprocal tariff" levels, and U.S. equities still face risks like high valuations, market concentration, and slowing growth.  

**"Hedge fund Jordan" Cohen: April’s U.S. stock rebound was extraordinary; even a 10-15% decline later wouldn’t be disastrous.**  

Cohen warned that the probability of a U.S. recession has risen to ~45%, with next year’s growth slowing to 1.5% or lower. However, he expects the Fed will not cut rates immediately due to potential inflationary pressures from tariffs.  

**Dalio: "The Art of the Deal" and "underlying forces."**  

Dalio stated we are on the cusp of major shifts in currency, domestic politics, and international order, with everything hinging on whether these issues are handled wisely and cooperatively.  

**Indian stocks surge as Trump claims India proposed "zero tariffs," but India’s "toughness" lasts only two days.**  

Trump said at a business event on Thursday that the Indian government "has proposed a deal to basically charge us no tariffs." Just two days earlier, India had submitted WTO countermeasures against Trump’s tariffs, planning to impose duties on some U.S. imports.  

**Reasons hindering gold’s further rise: The "dollar credit collapse" narrative is disrupted.**  

Soochow Securities believes gold’s medium-to-long-term uptrend may persist, but short-term momentum has weakened. The "dollar credit collapse" narrative supporting gold is challenged by factors like a potential U.S.-China trade deal, improved U.S. fiscal revenue, and Fed rate-cut expectations—all of which could strengthen the dollar and reduce gold’s appeal.  

**The capital rotation is obvious, and gold and Bitcoin show a "zero-sum game".**  

JPMorgan notes that as the "de-dollarization trade" stalls, gold ETFs have seen outflows over the past three weeks, while Bitcoin and crypto ETFs have attracted inflows. Additionally, gold prices have fallen ~8% since peaking at $3,500 on April 22, while Bitcoin has risen 18% over the same period. JPMorgan expects this "zero-sum game" to continue for the rest of the year, with crypto-specific catalysts creating more upside for Bitcoin in H2.  

**A major trend not to be ignored: Stablecoins—emerging "digital dollar hegemony."**  

Stablecoins are entering mainstream payment systems at an astonishing pace, with trading volume exceeding $28T, surpassing Visa and Mastercard. More than just financial tools, stablecoins are rapidly becoming strategic assets, with 83% pegged to the USD. Tether ranks among the largest holders of U.S. Treasuries, a series of trends that not only signal the rise of a new asset class but also imply the consolidation and expansion of dollar hegemony through digital means.  

**Trump launches all-out attack on Ivy League: Harvard probed by DOJ, Republican proposal aims to变相 tax and curb international student admissions.**  

The U.S. DOJ is investigating whether Harvard’s admissions process defrauded the government; if guilty, Harvard could face hundreds of millions in fines. A Republican proposal plans to levy tiered investment income taxes on universities based on per-student endowment size, raising the maximum rate from 1.4% to 21%, with international students no longer counted in endowment calculations.  

#### Overseas Companies  

**Trump pressures Cook: Doesn’t want Apple manufacturing in India!**  

Trump revealed he spoke with Apple CEO Tim Cook and made clear his opposition to Apple expanding production in India. He claimed Apple will "increase U.S. production" as a result.  

**Walmart’s Q1 sales grew 2.5%, slightly below expectations; CFO warns tariff-driven price hikes may start this month.**  

Walmart’s Q1 net sales rose 2.5% to $165.6B, with U.S. comparable sales up 4.5% (beating expectations). Despite strong sales, the CFO warned that tariff-induced price increases may begin this month. The company maintained its FY2026 sales and profit forecasts.  

#### Industries/Concepts  

1. **Electronic skin**: A Northeast Securities report notes the global force sensor and tactile sensor market is growing rapidly, from $2.16B in 2020 to an expected $2.84B in 2026 (4.68% CAGR).  

2. **Shipping**: A Huachuang Securities report states that during the 90-day U.S.-China tariff easement window, pre-stocking surges from Asia to the U.S. have boosted container demand. Long-term, industrial diversification is expected to sustain new opportunities for Asian container shipping.  

3. **Big finance**: A Northeast Securities report notes that U.S. funds’ overall allocation to financial stocks ranges from 12%-17%, roughly in line with the S&P 500’s 10%-16% weighting. However, China’s public funds hold far lower bank and non-bank positions than the CSI 300, indicating significant upside for financial stock allocation.  

4. **Laser weapons**: A Zheshang Securities report highlights laser weapons’ significant advantages against drone targets, such as no collateral damage, low strike costs, and fast response times, making them an optimal choice for countering "low, slow, small" aerial targets like drones.

Today's news preview
Hang Seng Index announced the results of the series of reviews of the Hang Seng Index for the first quarter of 2025.

Japan's real GDP in the first quarter.

The University of Michigan’s consumer confidence and inflation expectations were initially valued at the University of Michigan in May.

Net inflow of international capital in the United States in March.

New house construction and construction permits in the United States will be started in April.

<Full text end>



Disclaimer: The views in this article only represent the author's personal views and do not constitute investment advice of this platform. This platform does not make any guarantees for the accuracy, completeness, originality and timeliness of article information, nor is it liable for any losses caused by the use or trust in article information.