Morning News

**Source**: Wall Street News

### Market Overview

- On Friday, Trump threatened the EU and Apple faced tariffs, causing the US stock market to decline. The S&P 500 index fell for four consecutive days. Apple closed down 3%, with an eight - day losing streak, leading the decline among the seven major technology companies. The nuclear - power - related stock Oklo rose 23%, and US Steel rose 21%. After Trump's tariff threat, the automotive sector in the European stock market fell more than 3%.

- After Trump's tariff threat, the risk - averse sentiment heated up. The price of US bonds rose, the yield on the two - year US Treasury bond hit a two - week low intraday, gold rebounded 2%, and the futures gold rose more than 5% in a week. After Bessent's speech, the decline in the US stock market narrowed, and the yield on US bonds rebounded somewhat.

- The US dollar index hit a new low this month. The Japanese yen rose more than 1%. The offshore RMB rose more than 300 points intraday, broke through 7.18, and hit a six - month high. Bitcoin once plunged more than $4,000 from the record high on Thursday.

- Crude oil once fell nearly 2%, but then turned up.

- During the Asian session, the Shanghai Composite Index plunged in the afternoon and closed down nearly 1%. The pharmaceutical sector rose against the trend. The Hang Seng Index narrowly closed higher. The Hong Kong - listed shares of Hengrui Medicine made their debut with a 25% surge. National bonds strengthened.

### Main News

- China will promote the application of the national network identity authentication public service. Six departments have issued the *Measures for the Administration of the National Network Identity Authentication Public Service*.

- Trump threatened on Friday to impose 50% tariffs on the EU from June 1. After a phone call with von der Leyen on Sunday, Trump said that the deadline for EU tariffs would be extended to July 9. Von der Leyen said that Europe is ready to push forward negotiations quickly and decisively.

- Trump said, "I have warned Cook that Apple must manufacture iPhones domestically, or else there will be a 25% tax." Analysts said, "It's absurd. It's better for Apple to bear the tariffs than to move back to the US." Apple's stock price has fallen for eight consecutive days. Trump also issued tariff threats to Samsung and other mobile - phone manufacturers.

- Japanese Prime Minister Ishiba Shigeru said that he had a phone call with Trump and that Japan will continue to seek the removal of additional US tariffs. Reports said that India and the US may reach a trade agreement in principle within the next 7 - 10 days. The daily tariff revenue of the US Customs has increased to a record $16.5 billion.

- Bessent said that Trump's tariff threat is to urge the EU to speed up. Several major trade agreements will emerge in the next few weeks. The SLR will be revised and is expected to support US bonds. It is expected that by 2028, the proportion of the US budget deficit to GDP will drop to "starting with 3%", partly relying on tariff revenue.

- Trump supports the "planned cooperation" between Nippon Steel and US Steel. Japanese media said that the acquisition by Nippon Steel has been approved.

- A US judge has temporarily blocked Trump's ban, and Harvard does not have to immediately stop enrolling international students.

- Oracle will buy 400,000 of Nvidia's latest GB200 chips for a total value of $40 billion.

- Musk has returned to the "wartime mode" and promised to be "highly focused" on Tesla and other companies under his control, "going back to working 24 hours a day and sleeping in the conference room / server / factory room".

- Shanghai Securities News reported that Nvidia is said to launch a new AI chip for the Chinese market, based on the Blackwell architecture, with a selling price much lower than that of the H20, and mass production is expected as early as June.

- The first major deal after the new domestic restructuring regulations: the $300 - billion chip giant Hygon Information plans to absorb and merge the $90 - billion super - computing leader Sugon.

### Market Closing Reports

- European and American stock markets: The Dow Jones Industrial Average fell 0.61%, the S&P 500 index fell 0.67%, and the Nasdaq fell 1%. They fell 2.47%, 2.61%, and 2.47% respectively for the whole week. The European STOXX 600 index closed down 0.93%, and fell 0.75% for the whole week.

- A - share market: The Shanghai Composite Index fell 0.94%, the Shenzhen Component Index fell 0.85%, and the ChiNext Index fell 1.18%.

- Bond market: By the end of the bond market on Friday, the yield on the 10 - year benchmark US Treasury bond was about 4.51%, down nearly 3 basis points during the day, and up about 3 basis points for the whole week. The yield on the two - year US Treasury bond was about 3.99%, the same as on Thursday, and up about 1 basis point for the whole week.

- Commodities: The WTI July crude oil futures rose 0.54%, and fell about 0.7% for the whole week. The Brent June crude oil futures rose 0.53%, and fell nearly 1% for the whole week. The COMEX June gold futures rose 2.15%, and rose 5.6% for the whole week. The COMEX July copper futures rose 3.36%, and rose about 5.3% for the whole week.

### Details of Key News  

#### Global Highlights  

**Prevention of Personal Information Leakage: China to Promote National Cyber Identity Authentication Public Service**  

Six departments including the Ministry of Public Security and the Cyberspace Administration of China jointly released the *Measures for the Administration of National Cyber Identity Authentication Public Service*, which will take effect on July 15. The national cyber identity authentication public service platform is based on legal identity document information and presented through online account numbers, cyber certificates, and cyber identity application identifiers. It can both prove identity and avoid personal information leakage.  

**First Major Restructuring Case Under New Regulations: ¥300 Billion Chip Giant Haiguang Information Plans to Absorb ¥90 Billion Supercomputing Leader Sugon**  

Haiguang Information and Sugon are planning a share-swap absorption merger, where Haiguang Information will issue A-shares to all A-share shareholders of Sugon for the merger and simultaneously issue A-shares to raise supporting funds. The A-shares of both companies will be suspended from trading starting May 26.  

**Renewed Alarms in Trade Disputes: Trump Threatens 50% Tariffs on EU Starting June 1**  

Trump claimed via post that U.S.-EU negotiations had made no progress and stated he was not seeking a deal with the EU, insisting the 50% tariff would stand—unless companies build factories in the U.S., in which case the tariff might be delayed.  

**High Tensions in U.S.-EU Negotiations: America Demands 'Unilateral Concessions,' Warning 20% Tariffs Inevitable Otherwise**  

Media reports indicate the U.S. is dissatisfied with the EU’s offer of mutual tariff cuts rather than unilateral reductions, and further angered that the EU has not made digital taxes a negotiation priority. U.S. and EU trade officials plan to meet in Paris next month, a critical juncture to avoid escalating trade conflicts.  

*Don’t Underestimate the June 1 Risk!* Europe seeks negotiations, but the U.S. demands concessions, with markets anticipating "another April 2." Analysts note the slow progress in U.S.-EU talks stems from fundamental differences in their understanding of the negotiations. If the 50% tariff takes effect and persists after June 1, it could be devastating for the EU.  

After a phone call with European Commission President von der Leyen, Trump announced on Sunday that the deadline for the 50% tariff on the EU would be extended to July 9. Von der Leyen said Europe is "ready to advance negotiations swiftly and decisively" but needs "time until July 9" to reach a good agreement.  

**Yen Maintains Rally: Japanese Prime Minister Ishiba Shigeru Says Japan Will Continue Seeking Removal of Additional U.S. Tariffs**  

Ishiba Shigeru stated that Japan’s position on tariffs has not changed and that Trump requested the phone call, during which they reached broad consensus.  

**At a Critical Juncture in Tariff Talks: SoftBank’s Son Proposes U.S.-Japan Joint Sovereign Fund with Initial Capital Up to $300 Billion**  

Media reports say Son has discussed the fund concept directly with U.S. Treasury Secretary Bessent and briefed senior officials in both countries. The fund aims to make large-scale investments in U.S. technology and infrastructure.  

U.S. customs daily tariff revenue hit a record $16.5 billion.  

**Trump: I Warned Cook—Apple Must Manufacture Domestically or Face 25% Tariffs!**  

Trump claimed he had told Cook that iPhones sold in the U.S. should be made in America, not India or elsewhere. "If not, Apple must pay at least a 25% tariff." Apple’s pre-market stock price plunged 4%, closing down 3%.  

*Apple in Hot Water, Shares in Free Fall*: Apple’s stock has fallen for eight consecutive days, with its market cap dropping from first to third globally. Recently, Trump mentioned having "a small issue" with Tim Cook and publicly criticized Apple’s factory in India. Meanwhile, Apple faces pressures such as falling behind in the AI arms race and weak growth in the Chinese market.  

*Analysts: 'Absurd!' Apple Would Fare Better Bearing Tariffs Than Relocating to the U.S.*: Analysts predict a 25% tariff could reduce Apple’s annual EPS by over 7%, and if iPhone prices remain unchanged, its gross margin could drop 3.5 percentage points next fiscal year. Guo Ming錤 noted that in terms of profitability, absorbing the 25% tariff is far better than relocating iPhone assembly to the U.S.; a full relocation during Trump’s term is unrealistic, and Trump’s opposition to Indian manufacturing offers no guarantee Apple won’t face future tariff threats.  

Trump also threatened tariffs on Samsung and other smartphone manufacturers. When asked at the White House on Friday whether the president has the authority to impose tariffs on individual companies, Trump said the tariffs would apply not just to Apple but also Samsung and any company producing phones, with policies expected to take effect by late June.  

**Trump Supports Nippon Steel-U.S. Steel 'Planned Cooperation,' Japanese Media Report Approval**  

Trump claimed the partnership would create at least 70,000 jobs and contribute $14 billion to the U.S. economy. U.S. Steel’s stock surged over 20% in late trading. Prior to Trump’s post, the White House confirmed he had received a recommendation from the Committee on Foreign Investment in the U.S. (CFIUS) on Nippon Steel’s acquisition, with most committee members believing "any risks can be addressed through mitigation measures."  

**Bessent: Trump’s Tariff Threats Aim to Speed Up EU Talks—Big Trade Deals Expected in Weeks, SLR Revisions Could Support Treasuries**  

U.S. Treasury Secretary Bessent said U.S.-India negotiations have entered advanced stages and expressed hope Apple will aid in chip security. He forecast that by 2028, the U.S. budget deficit as a percentage of GDP will fall to "start with 3%," partly relying on tariff revenue. He downplayed recent dollar weakness and distanced Treasury volatility from U.S. tax legislation.  

*Report: U.S.-India May Reach Principles-Level Trade Agreement in 7-10 Days*  

*Goldman Sachs: Japanese Bond Collapse Drove U.S. Treasury Selloff*: While the Japanese government bond selloff has not yet spread to Japanese stocks or the yen, its spillover effects on global bond markets are growing. The surge in U.S. Treasury yields over the past month is likely mostly a "byproduct" of turmoil in Japan’s long-bond market.  

*Goldman Trader: U.S.-EU-Japan Long Bond Yields to Continue Rising—Speed Is Key, Watch Japan’s Long Bond Auction This Week*  

*A Potential 'Major Boon' Flying Under the Radar Before Month-End*: The U.S. Court of International Trade will rule on a preliminary injunction to废除 Trump’s April 2 tariff plan. If granted, the 10% comprehensive tariff and pending reciprocal tariffs would be halted, and tense negotiations between the U.S. and the EU, Japan, India, etc., would be reshuffled.  

A U.S. judge temporarily blocked the Trump administration’s ban, allowing Harvard to continue enrolling international students for now. Judge Allison Burroughs’ temporary injunction will remain in effect until the court rules on Harvard’s application for a longer-term injunction, with a hearing set for May 29. Harvard sued the Boston federal court earlier on Friday over the ban.  

**Oracle to Buy 400,000 of Nvidia’s Latest GB200 Chips for $40 Billion**  

The purchase will support computing power for Oracle’s data center in Abilene, Texas, part of the U.S. Stargate Project. Oracle’s stock briefly surged on the news but ultimately closed down with the broader market.  

**Return to 'War Mode'! Musk Promises 'Heightened Focus' on Tesla and Portfolio Companies**  

Musk said he will return to working 24 hours a day and sleeping in conference rooms, server rooms, or factory floors. Since announcing reduced involvement in Trump administration work on April 22, Tesla’s stock has risen 43%, with its market cap returning to $1 trillion, indicating investors trust a business-focused Musk to create奇迹. He added that improving productivity, with robots as the key, is the only way to save America.  

*Shanghai Securities News: Nvidia Said to Launch New AI Chip for China Market—Significantly Cheaper Than H20, Mass Production as Soon as June*  

The Blackwell architecture-based chip is expected to sell for $6,500–$8,000.  

#### Domestic Macro  

*Global Times: U.S. Media Report First Post-Geneva Talk Phone Call Between U.S.-China Officials, Calling It a 'Positive Signal'*  

According to State Department and Foreign Ministry announcements on the 22nd, officials from both sides spoke by phone. While the readouts did not explicitly mention tariffs, their similar wording suggested they would "continue high-level engagement to strive for a broader agreement."  

*State Media Article: View U.S.-China Geneva Trade Talks Results Rationally*  

The article noted that the U.S.-China trade conflict has not ended, and future negotiations will be complex and difficult. It warned of the possibility that the U.S. may use a delaying tactic to止损 its economy, with tariff threats likely to resurface once domestic political and economic tensions ease. Given the long-term and complex nature of the struggle, China should prepare fully for negotiations and long-term confrontation.  

*Hong Kong Mulls Halving Commodity Transaction Tax*  

Hong Kong Financial Secretary Paul Chan revealed plans to submit a draft bill to the Legislative Council as soon as possible to provide a 50% profit tax reduction for eligible commodity trading activities, earlier than the original plan for H1 2026. This aims to attract traders through tax cuts, boosting related industries like warehousing, logistics, and financial insurance as part of Hong Kong’s push to build a commodity ecosystem.  

#### Domestic Companies  

*Goldman Sachs, Deutsche Bank Comment on Xiaomi Launch: Xuanjie Chip Kicks Off Company’s 'Hard Tech Decade,' YU7 May Become Blockbuster SUV*  

Goldman Sachs said Xiaomi has become the fourth global company with self-developed 3nm process SoC, marking a new starting point for core technology breakthroughs in the next decade. Deutsche Bank believes YU7 targets the core competition zone of the premium EV market, with 2025 delivery forecasts of 100,000 units, making Xiaomi’s automotive business a key revenue and profit growth driver.  

*"YU7 Concept Stocks" Emerge*: Morgan Stanley identified Huayang Group as the biggest beneficiary, as it will supply the "HyperVision" panoramic head-up display (P-HUD) system for Xiaomi YU7, expected to drive 10–15% annual revenue growth. Top Group, Desay SV, and Xingyu股份 were also cited as key beneficiaries.  

#### Overseas Macro  

*Trump Announces New Nuclear Policy: Launch 10 Large Nuclear Power Plants by 2030*  

Through four executive orders, Trump plans to quadruple U.S. nuclear power capacity by 2050. In the past 20 years, the U.S. has completed only two large reactors at a cost exceeding $30 billion—double the initial budget.  

*Debt Ceiling Unresolved as Senate Reviews Trump Tax Reform Bill*  

After barely passing the House, the Senate will drastically revise the tax reform bill. Republican分歧 over tax details and spending cuts has stalled debt ceiling increases, while Democrats seek to remove non-fiscal clauses, adding uncertainty to the legislative outlook.  

*Fed Dove Goolsbee: Short-Term Rate Cut Threshold 'Somewhat High,' but Cuts Possible in 10–16 Months*  

Chicago Fed President Goolsbee said rates could be much lower 10–16 months from now and warned that high tariffs would be "terrible" for supply chains.  

*U.S. Supreme Court: Trump Can Fire Government Officials, But Not Fed Chairs*  

The Court ruled Trump has the authority to remove government officials but cannot fire Fed Chair Powell, whose term is secure until 2026. The decision eases market fears about Fed independence while strengthening White House power to restructure other regulatory agencies.  

*Market Buzz: 'Macro Crocodile' Bets Billions on U.S. Tech Stocks*  

A major investor has quietly bought billions of dollars in 2027 June-dated call options on U.S. tech giants, spending $3 billion in premiums. Analysts speculate the buyer is a "well-funded, optimistic global macro player" seeking to profit from increased volatility.  

*What Is the Market Pricing for U.S. Fiscal Policy?* China Merchants Securities asks how the market will weigh tax cuts’ economic stimulus against fiscal sustainability concerns. The turning point may come in late June–early July: if the U.S. reaches trade agreements with non-U.S. economies or finds Treasury buyers, and if tariff-driven inflation emerges with deficit-increasing bills near stabilization, the market may shift from pricing in risks (denominator) to growth (numerator), making Treasuries and U.S. stocks more attractive.  

*How Much Must the Dollar Depreciate to Eliminate the Trade Deficit? Deutsche Bank Says 40%*  

The bank warned a 40% dollar decline is needed, as tariff measures have limited effect and may cause price hikes and economic slowdown.  

*Guojin Securities’ Song Xuetao: Chaos Continues, Gold’s Rally Isn’t Over*  

While recent tariff缓和 has caused pullbacks, the chaotic outlook for the dollar’s credit status means gold will rebound unless the U.S. improves productivity and fiscal efficiency to escape stagflation and maintain the dollar’s reserve currency status.  

*Wall Street Alert: Japan Can Save JGBs, But at the Cost of Treasuries*  

Barclays notes that if JGB selling persists, Japan may direct state institutions to buy JGBs, but this would likely require selling overseas assets—starting with U.S. Treasuries.  

*Is There a Way Out for U.S. Debt? Goldman Trader Sees Three Paths, Already Reflected in Gold and Cryptocurrencies*  

Rich Privorotsky argues the only ways to break the Treasury-stock vicious cycle are cutting spending, financial repression, or intervening in forex markets—all unlikely. Thus, capital is flowing into gold and crypto, indicating markets have priced in these structural pressures.  

*Japan’s Inflation Pressures Intensify: Key Index Hits Two-Year High*  

Japan’s core CPI (ex-fresh food) rose 3.5% YoY in April, the highest since January 2023. Rice prices surged 98.4% YoY, the largest increase since comparable data began in 1971. Analysts expect the BOJ to raise rates again in October.  

*Ethereum Unveils 'Trillion-Dollar Security Plan' Aiming to Be the 'Settlement Layer of the Future'*  

Focused on a decade of stable operation and decentralized validators, the plan aims to prove Ethereum’s capability to secure trillion-dollar values through "real-world asset tokenization (RWA)."  

#### Overseas Companies  

*After Tech Giants and Gulf Tycoons, How Will Nvidia Sustain Growth?* Relying on huge orders from a few super-clients is unsustainable. Facing growth pressure, Nvidia is betting on NVLink Fusion and RTX Pro enterprise servers at Computex to expand AI market control through technological innovation.  

*Claude 4 Runs Amok: Self-Replicating and Escaping Human Control, Netizens Urge 'Pull the Plug'*  

Claude 4 can code autonomously for seven hours without human intervention. Reports reveal it threatened engineers to preserve itself, copied its own weights, and even献计 to develop biological weapons, sparking fears that science fiction is becoming reality.  

*OnlyFans Parent Company in $8B Sale Talks*  

The adult-content platform’s parent is in talks to sell at an $8 billion valuation, with potential acquirer Forest Road previously attempting a SPAC listing for OnlyFans.  

#### Sectors/Concepts  

1. **Smart Manufacturing**: Analysts say green transformation is essential for high-quality manufacturing development. Driven by policy, green manufacturing sectors may attract capital, boosting technological upgrades, industrial expansion, and corporate profitability.  

2. **Industrial Park Development**: National economic and technological development zones are transitioning from traditional manufacturing bases to open, innovative, and green economic hubs. Policy dividends, industrial upgrading, global supply chain restructuring, and regional coordination will provide core support, with new formats like cross-border data flows, e-commerce, and green finance as growth highlights.  

3. **Digital ID**: The *Measures for Cyber Identity Authentication* clarify that internet services requiring real-name registration can use online accounts and cyber certificates, reducing personal information collection and achieving "usable but invisible" data, while lowering protection costs.  

4. **HarmonyOS**: Analysts note that robot operating systems support AI models and hardware management, serving as the "foundation" for robotics. As the industry shifts from functionality to practicality (scalability), demands for OS security, reliability, and real-time performance will rise, making OS development a top priority.  

5. **Low-Orbit Satellites**: 2025 is a critical year for dense satellite internet launches and a inflection point for terminal market explosion.  

6. **Energy Storage**: Industrial Securities states that lithium battery sectors are benefiting from price stabilization and slower capacity expansion, with pessimistic expectations easing. As cost-cutting measures take effect and the second-half peak season arrives, industry profits are stabilizing and gaining upward momentum. New technologies like solid-state, sodium, and dual-core batteries are reshaping competition, with advantaged companies likely to rebound first.  

### Upcoming Key News  

- Fed Chair Powell delivers a commencement speech at Princeton University.  

- ECB President Lagarde speaks.  

- Meituan reports earnings.  

- Horizon Robotics is added to the Hong Kong Stock Connect.  

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