Morning News

# Market Overview

Investors bet on Nvidia's strong earnings to reignite enthusiasm for AI trades, driving tech stocks to rebound for a second consecutive day. The Nasdaq rose another 1%, marking its first two-day gain of over 1% in two months. The software stocks ETF also rebounded for a second day, climbing 3%. All seven major tech giants advanced; after hours, Nvidia's earnings and guidance far exceeded expectations, with its share price surging about 3.5% at one point before turning lower.

Circle skyrocketed 35% after reporting better-than-expected Q4 results. Netflix rose nearly 6% as markets bet it will abandon its pursuit of Warner Bros. Discovery.

U.S. Treasury yields rose across the board. The U.S. dollar fell 0.24%. The Chinese yuan strengthened for a fourth straight day, breaking through the 6.87 and 6.86 levels intraday and approaching 6.85, hitting its highest point since April 2023.

Cryptocurrencies staged a massive rebound. Bitcoin surged nearly 8%, approaching $70,000 again. Ethereum jumped 13%, briefly breaking through $2,100.

Precious metals extended their late U.S. stock market rebound from the previous day; gold rose 0.44% and silver gained 2.2%. WTI crude oil fell 0.77%, pressured by a sharp increase in U.S. crude oil inventories.

During Asian trading hours, China's ChiNext Index rose over 1%, with price-hike themes surging across the board. The yuan hit a nearly three-year high. The Hang Seng Index fluctuated higher by 0.7%, while Zhipu AI, the first listed large-language model company, plunged over 10%.

# Key News

## China

- Joint Press Statement of the People's Republic of China and the Federal Republic of Germany.

- U.S. Trade Representative says it will continue 301 investigations into the implementation of the China-U.S. Phase One Trade Agreement; China's Ministry of Commerce responds.

- Premier Li Qiang: Chinese and German enterprises can further deepen cooperation in machinery, equipment, chemicals and other sectors.

- Shanghai releases new property market policies ("Shanghai Seven Rules"): non-local residents' social insurance requirement for purchasing homes within the Outer Ring Road is lowered to 1 year; maximum housing provident fund loan raised to 3.24 million yuan.

- Hong Kong Annual Budget: 2025 economic growth of 3.5%, property market recovery, average daily stock market turnover up 90%; 2026 economic growth projected at 2.5%-3.5%.

- ByteDance's new valuation reaches $550 billion.

## Global

- AI demand remains strong: Nvidia's Q4 revenue jumped 73%, Q1 guidance "blows away" estimates to a new high; Jensen Huang raises $500 billion revenue forecast. Huang: Enterprise adoption of AI agents surges; Grace Blackwell paired with NVLink is king of inference; current space data center economy is "barren" but will evolve over time.

- Trump's State of the Union: "Tariffs have boosted the stock market"; big tech companies must build their own power plants; legislation should ban lawmakers from trading stocks.

- U.S. Trade Representative: Proposed "global import tariffs" on some countries could reach 15%. EU estimates €4.2 billion of goods face new tariffs exceeding U.S.-EU agreement limits.

- Iranian foreign minister prepares for third round of indirect U.S.-Iran talks; Trump demands "never to possess nuclear weapons"; Vance: U.S. hopeful for talks but doesn't rule out military action.

- Cuban Interior Ministry: U.S.-registered speedboat entered Cuban territorial waters and opened fire; Cuban forces returned fire, killing 4.

- Traders scale back Fed rate-cut bets; June rate-cut probability falls to 50%, a new low for the year.

- CME technical glitch disrupts natural gas and metals futures trading; all Wednesday orders canceled.

- World's fourth-largest lithium producer announces immediate suspension of lithium ore exports.

# Market Closing

## U.S. & European Equities

- S&P 500: +0.81% to 6,946.13

- Dow Jones: +0.63% to 49,482.15

- Nasdaq: +1.26% to 23,152.08

- Europe STOXX 600: +0.69% to 633.47

## China A-Shares

- Shanghai Composite: +0.72% to 4,147.23

- Shenzhen Component: +1.29% to 14,475.87

- ChiNext Index: +1.41% to 3,354.82

## Bonds

- U.S. 10-year Treasury yield: +1.91 bps to 4.0480%

- U.S. 2-year Treasury yield: +0.79 bps to 3.4689%

## Commodities

- Spot Gold: +0.52% to $5,171.48/oz

- Spot Silver: +2.67% to $89.4791/oz

- WTI Crude (April): -0.32% to $65.42/bbl

- Brent Crude (April): +0.11% to $70.85/bbl

# Detailed News Highlights

## Global Highlights

### China

**Joint Press Statement of the People's Republic of China and the Federal Republic of Germany**. According to Xinhua News Agency, both sides emphasized that economic and trade cooperation is an important component of bilateral relations and are willing to deepen mutually beneficial and win-win cooperation. They stressed that open dialogue, fair competition, and mutual market opening are crucial. China noted Germany's concerns about "de-risking," trade imbalances, and export controls, while Germany noted China's concerns about the over-securitization of economic and trade issues and high-tech product export controls. The two sides are willing to properly address each other's concerns through candid and open dialogue to ensure a long-term, balanced, reliable, and sustainable economic and trade relationship.

**USTR to continue 301 investigation into China-US Phase One trade deal implementation; MOFCOM responds**. China stands ready to work with the U.S., guided by the important consensus reached by the two heads of state, to make good use of the China-US economic and trade consultation mechanisms, focus on the future, concentrate on implementing the existing economic and trade consensus and outcomes, actively explore areas of converging interests, and jointly "look forward." If the U.S. insists on advancing relevant investigations and even imposes restrictive measures such as tariffs on the pretext of investigations, China will take all necessary measures to resolutely safeguard its legitimate rights and interests.

**Premier Li Qiang: Chinese and German enterprises can further deepen cooperation in machinery, equipment, chemicals, and other fields**. On the afternoon of February 25, Premier Li Qiang of the State Council and German Chancellor Friedrich Merz jointly attended the symposium of the China-Germany Economic Advisory Committee in Beijing. Li Qiang stated that amid rising uncertainties in the global economy, China and Germany should strengthen cooperation to address risks. The two sides can coordinate efforts in three areas—traditional cooperation, future opportunities, and business environment—to achieve mutual benefits. Merz noted that Germany-China economic and trade relations are vibrant, and Germany is willing to strengthen cooperation in automobiles, chemicals, renewable energy, and other fields, welcoming Chinese enterprises to invest in Germany.

**Shanghai releases "Shanghai Seven Rules" for property market: social insurance requirement for non-Shanghai residents to buy homes within the Outer Ring Road lowered to 1 year; maximum housing provident fund loan raised to 3.24 million yuan**. Five municipal departments jointly issued new property market policies, effective February 26, 2026. On purchase restrictions: non-Shanghai residents need only 1 year of social insurance to buy homes within the Outer Ring Road; those with 3 years of social insurance can purchase an additional home; holders of Shanghai residence permits for 5 years are exempt from social insurance requirements for one home purchase. On provident fund loans: the maximum loan for first homes is raised to 2.4 million yuan (3.24 million yuan for multi-child families), and second-home loan eligibility criteria are relaxed. On taxation: first homes purchased by adult children are temporarily exempt from individual housing property tax.

**Experts interpret Shanghai's new "Seven Rules"**. According to The Paper, non-Shanghai residents with 1 year of social insurance can buy homes within the Outer Ring Road; maximum provident fund loans reach 3.24 million yuan with "recognize house, not loan" implementation; specific first homes are temporarily exempt from property tax. The new policies directly address pain points of job-housing balance, livability, and rigid/upgrading demand, significantly reducing home purchase and replacement costs, boosting housing consumption, balancing supply and demand, and consolidating the property market's stable and positive trend.

**Hong Kong Annual Budget: 3025 economic growth 3.5%, property market recovery, stock market daily turnover up 90%; 2026 growth projected at 2.5%-3.5%**. Paul Chan, Financial Secretary of the Hong Kong SAR Government, released the 2026/27 Budget. Hong Kong's economy grew 3.5% in 2025, rising for three consecutive years. The Hang Seng Index rose 28% for the year, with average daily turnover surging 90% to nearly HK$250 billion, and IPO fundraising ranking first globally. The property market recovered, with residential transaction volume hitting a four-year high and prices ending three years of decline. 2026 economic growth is projected at 2.5%-3.5%.

**ByteDance's new valuation hits $550 billion**. Investment firm General Atlantic plans to sell part of its ByteDance stake at a valuation of $550 billion, up 14.6% from the $480 billion secondary market valuation in November 2024 and 66% from last year's employee buyback price. Strong financial performance—annual profit expected to reach $48 billion, surpassing Meta—and reduced uncertainty around TikTok's U.S. business support this high valuation.

### Overseas

**AI demand remains robust: Nvidia's Q4 revenue up 73%, Q1 guidance "blows away" estimates; Jensen Huang raises $500 billion revenue target**. Q4 total revenue and data center revenue hit records; gross margin tops 75%, a 18-month high, driven by Blackwell ramp-up. Data center revenue beat expectations, surging 75% YoY, with networking revenue up over 260%. Gaming revenue missed estimates, down 13% QoQ due to channel inventory. Nvidia expects supply constraints to be a headwind starting Q1. Q1 revenue midpoint guidance is 4% above the most bullish buy-side forecasts, up nearly 77% YoY (ex-China data center compute revenue). Non-GAAP will include stock-based compensation starting Q1. Huang said compute demand is surging and AI agent adoption is soaring, exceeding the previously set $500 billion chip revenue target; the space data center economy is currently "barren". Nvidia rose nearly 4% in after-hours trading, but a commission spokesperson said about 7% of EU exports will face tariffs above the 15% cap under new U.S. tariff mechanisms. He emphasized EU products must continue to receive the most competitive treatment, with tariffs not exceeding previously agreed clear and comprehensive caps.

**Iranian FM to attend third round of indirect U.S.-Iran talks; Vance: U.S. hopeful but not ruling out military action**. On the evening of February 25 local time, Iranian Foreign Minister Araghchi led a delegation to Geneva, Switzerland, for the third round of talks on February 26. U.S. Vice President J.D. Vance said the U.S. is "hopeful" about the new round of indirect talks. The U.S. position is "very clear": Iran must not possess nuclear weapons. President Trump prefers diplomacy but will use military force if necessary.

**U.S.-Iran nuclear talks set to resume Thursday; Trump demands "never to possess nuclear weapons"; oil prices move early**. In his State of the Union address, Trump again pressured Iran, saying negotiations continue but "we have not yet heard the key phrase: 'We will never possess nuclear weapons.'". With Iran controlling the Strait of Hormuz, through which 16.5 million barrels of oil pass daily, market concerns pushed oil prices to six-month highs. Iran, facing "maximum pressure" with constrained oil revenues, the Geneva talks this week will determine short-term oil market direction.

**Cuban Interior Ministry: U.S.-registered speedboat enters Cuban territorial waters, opens fire; Cuban forces return fire, killing 4**. On February 25 local time, the Cuban Interior Ministry announced that border guards detected a speedboat registered in Florida, U.S., illegally entering territorial waters near Villa Clara Province; a firefight ensued, leaving 4 foreign attackers dead and 6 injured. On the same day, the U.S. planned to conditionally ease its oil blockade on Cuba; Canada provided aid to Cuba, making an "independent decision" without consulting the U.S..

**Traders scale back Fed rate-cut bets; June cut probability falls to 50%, a new low for the year**. Amid rising risk appetite, money markets now price a 50% chance of a 25-bp rate cut by end-June, the lowest this year, indicating investors are re-evaluating the easing path. Chicago Fed President Goolsbee previously struck a hawkish tone, saying "3% inflation is not good enough" and warning against premature cuts. Markets are shifting toward a "fewer, later" cautious rate-cut trajectory.

**CME technical glitch disrupts natural gas and metals futures trading; all Wednesday orders canceled**. This is the second systemic trading outage at CME in about a month, coinciding with the March natural gas futures contract expiration. Market participants called the pre-close "freeze" "extremely poorly timed," noting "all participants using futures for pricing and hedging were affected."

**World's fourth-largest lithium producer suspends exports effective immediately**. Zimbabwe announced an immediate suspension of lithium concentrate and ore exports, implementing its resource localization strategy far faster than expected. The country holds 126 million tons of lithium reserves, a major global supplier. The ban will directly impact overseas refiners, with U.S. lithium stocks rising in pre-market trading.

## Selected Research Reports

**HSBC's contrarian view: Software will "eat AI"; now is a good time to buy the dip**. HSBC argues enterprise software will not be disrupted but will "consume and domesticate" AI. Large language models' non-deterministic flaws fail to meet enterprises' zero-error, high-reliability requirements, while traditional software giants like Microsoft and Oracle are embedding AI into their platforms with deep data and architecture moats. Compared to previously hyped hardware semiconductors, the software sector is at historical valuation lows, with 2026 set to be the inaugural year for AI monetization in the software industry.

**"Scarce assets" in the AI era? Goldman Sachs: HALO—heavy assets, not obsolete**. Goldman Sachs proposes capital is flowing to "heavy assets, low obsolescence" (HALO) physical assets in the AI era, such as power grids, pipelines, utilities, transportation infrastructure, and key industrial capacity. These assets are hard to replicate, have high physical barriers, and are not easily outdated. Goldman's HALO portfolio has outperformed light assets by 35% since 2025, with heavy-asset firms expected to surpass light-asset peers in earnings growth and ROE across the board.

**AI capex surges, power grids strained; Goldman Sachs sharply raises global AI power demand forecast: 220% increase by 2030**. Goldman's latest report raises 2030 global data center power demand growth to 220%, with the U.S. accounting for 60%. AI investment is spilling over from computing power to power supply chains, triggering an infrastructure "reliability supercycle". While cloud providers' surging capex squeezes free cash flow, they can still afford to pay a premium for clean power. Industry bottlenecks are shifting from power generation equipment to labor shortages, with market focus moving from "theme hype" to hard constraints on "AI revenue conversion."

# Domestic Macro

### China Launches Focus List System for the First Time: What Does It Mean?

According to an article by Yuyuantantian:

1. The launch of the **Focus List system** marks a new path of **targeted governance** for China’s export control regime.

2. Strict prohibitions on entities on the control list demonstrate China’s firm stance against Japan’s attempts at **re-militarization** and nuclear ambitions.

3. These measures represent an upgrade to **Announcement No. 1**, enabling **multi-layered control, precise prevention, and effective countermeasures** against Japan’s military-related entities.

### Will the Yuan Break Through 6.8 Against the Dollar?

Multiple institutions point out that **eroding dollar credibility** is the core driver of this round of yuan appreciation. As long as the dollar’s weakness persists, amplified by corporate FX settlement demand and solid economic fundamentals, the yuan’s appreciation trend is unlikely to end. Caitong Securities estimates that under extreme scenarios, the yuan could break through the 6.8 level.

# Domestic Companies

### Major Investment in Guangdong: Liu Qiangdong Announces 5 Billion Yuan Venture

Liu Qiangdong has announced a **personal investment of 5 billion yuan** to establish **Sea Expandary**, a new energy intelligent yacht brand, in Guangdong, with a full industry chain布局. He aims to launch **100,000-yuan yachts** affordable for wage earners, popularizing yacht consumption and tapping into China’s vast yacht market potential.

### Transsion Holdings’ 2025 Net Profit Plunges 53%: Soaring Memory Chip Prices the Biggest “Profit Killer”

Transsion Holdings reported a **53% collapse in net profit** for 2025, with surging memory chip prices identified as the primary drag on earnings.

### Alibaba Cloud Launches Low-Cost AI Coding Package Integrating Four Top Open-Source Models

Alibaba Cloud Bailian has introduced the **Coding Plan**, offering API services for four leading open-source models: **Qwen3.5, GLM-5, MiniMax M2.5, and Kimi K2.5**. Among global cloud providers, only Alibaba Cloud currently provides this service. Pricing: **Light Plan** at **7.9 yuan for the first month, 40 yuan/month thereafter**; **Pro Plan** at **39.9 yuan for the first month, 200 yuan/month thereafter**.

### Surging AI Computing Demand Drives Hygon Info’s 57% YoY Revenue Growth in 2025; Q1 2026 Net Profit Seen Up 23%–42%

Driven by robust AI computing demand, **Hygon Information** achieved **57% year-on-year revenue growth** in 2025. The company forecasts **net profit growth of 23% to 42% year-on-year** for Q1 2026.

# Global Macro

### US-UK Tech Agreement Resumes with Difficulty: Civil Nuclear Projects Lead the Way; AI & Quantum Remain Stalled

The US-UK **Tech Prosperity Agreement** has been partially revived, with **civil nuclear energy** being the first area to make progress. The two sides have begun discussions on nuclear technology cooperation, aiming to shorten project approval cycles, benefiting companies such as Centrica. However, cooperation on **AI and quantum computing**, the original core of the agreement, remains stalled, reflecting ongoing competition in sensitive tech sectors. Despite Trump’s new 10% global tariffs, sources say the tariffs will not hinder negotiations.

### Japan’s Long-Term Bond Yields Surge; Kishida Nominates Re-Inflationists to BOJ Policy Board

Japanese Prime Minister Fumio Kishida has nominated two **re-inflationist academics** to the Bank of Japan’s Policy Board, sending a strong dovish signal. This triggered a **10.5-bp jump in the 30-year JGB yield to 3.38%**, a weaker yen, and a **2.2% rise in the Nikkei**. Market expectations for an April rate hike are being reassessed. Analysts believe approval would slightly delay tightening but not derail the BOJ’s policy path, with concerns over central bank independence remaining manageable.

### UNGA Adopts Resolution Calling for Immediate Ceasefire in Ukraine: 107 in Favor, 12 Against; Russia Opposes, China & US Abstain

The UN General Assembly adopted a resolution “**Supporting a Just and Lasting Peace in Ukraine**” with **107 votes in favor, 12 against**. Russia voted against, while China and the US abstained. China called for conditions for a political solution; Ukraine insisted on security guarantees; Russia questioned who would provide guarantees to Russia. The US has shifted to “**negotiations first**,” but core issues like territory and neutrality remain unresolved. Among 2.5 million Ukrainian female refugees in the EU, **1 in 4** has experienced violence.

### Quant Giant Jane Street Accelerated 2022 Crypto Winter: Insider Trading Front-Running & Deep-Discount Bargain Hunting

Jane Street is accused of being a “**hidden hand**” in the **$400 billion Terra collapse**. Through a secret channel called “**Bryce's Secret**,” the firm obtained insider information, executed the largest single sell-off in history less than 10 minutes after Terraform Labs quietly withdrew funds, and then attempted to buy the dip at steep discounts. This institutional short triggered the global crypto winter, contributing to FTX’s collapse.

### OPEC+ Likely to Finalize Output Increase Plan on Sunday; April “Modest Production Hikes” Expected

Current oil prices contrast with “supply glut” expectations; resilient demand, geopolitical risks, and supply disruptions have pushed oil prices up **17%** year-to-date. Multiple OPEC+ delegates expect a return to “**gradual, small-scale production increases**” in April. Analysts forecast a limited incremental supply of about **137,000 barrels per day**.

# Global Companies

### OpenAI & Anthropic Miss Gross Margin Targets; Free Users & Computing Power Become Major Burdens

Both **OpenAI** and **Anthropic** face severe profitability challenges due to runaway inference costs.

### Electronic Fabrics: 7628 Cloth Prices to Rise; AI-Driven Supercycle Underway

Driven by AI demand, **7628 electronic fabric** prices are expected to rise by up to **8 yuan per meter**. CITIC Securities notes that, similar to memory chips, this cycle is driven by AI, with stronger growth and persistence. AI demand favors **specialty fabrics**, and supply bottlenecks from Toyota loom capacity will keep specialty fabrics in short supply through 2026. Recent production shifts from E-glass to Low-Dk fabrics confirm tight supply.

### AI Chips: Peking University Develops World’s Smallest, Lowest-Power Ferroelectric Transistor

A team from Peking University’s School of Electronics has fabricated the **world’s smallest and lowest-power ferroelectric transistor**, with a physical gate length of **1 nm**. This breakthrough reduces energy consumption by an order of magnitude compared to the global best, providing a core device for higher computing power and energy efficiency in AI chips.

### Precision Medicine: CAS Develops “Histidine Scanning” to Enhance T-Cell Cancer Killing

Researchers at the CAS Center for Excellence in Molecular Cell Science have developed a **histidine scanning method** to identify key sites on T-cell receptors (TCRs) that recognize cancer cells. Modifying these sites turns TCRs into high-sensitivity “**security scanners**,” significantly boosting T-cell anti-cancer activity. The approach works without 3D structural data and has shown strong efficacy in animal models.

### Lithium: Zimbabwe Suspends Lithium Ore Exports Immediately

Zimbabwe’s Ministry of Mines has announced an **immediate suspension** of all lithium ore and concentrate exports, including goods in transit. Future exports will be restricted to holders of valid mining rights and approved processing plants; agents and third-party traders are banned. Violators face revocation of export licenses and mining rights. As the **world’s fifth-largest lithium producer** (12% of global supply), with over 90% of exports going to China, this move will tighten global supply and support lithium prices.

# Today’s Key Events

- US Initial Jobless Claims (last week)

- Fed Governor Bowman’s Congressional Testimony

- ECB President Lagarde Speaks to EU Parliament

- BOJ Financial Markets Department “Market Operations Meeting”

- Bank of Korea Interest Rate Decision

- Baidu Earnings Call

---

# Risk Disclaimer

The market is volatile and investments involve risks. This document is for informational purposes only and does not constitute personalized investment advice. It does not take into account any user’s specific investment objectives, financial situation, or needs. Users should assess whether any opinions, views, or conclusions herein are suitable for their particular circumstances. Investment decisions are made at the user’s own risk.