News

Morning News

Source: Wall Street Journal

Market Overview

After Trump "changed his tune", the three major US stock indexes rose for four consecutive days. After Trump mentioned tariffs during the session, the S&P 500 and Nasdaq indexes once gave up more than half of their gains, and the Dow Jones index once fell more than 100 points. Nvidia closed up more than 4%, Tesla soared nearly 10% and rose 18% in a week, and Google gave up most of its gains after rising more than 4% at the beginning of the session. The China stock index ended its three - day winning streak but still rose more than 7% for the week. The pan - European stock index hit a three - week high again, and the British stock market rose for ten consecutive days.

The yield on US bonds has been declining for several days. The US dollar rebounded and gave up most of its gains after the release of the Michigan consumer confidence index in the United States, but still recorded its first weekly increase in more than a month. Bitcoin once rose nearly $3,000 and broke through $95,000.

Gold fell more than 1% and turned down for the week, recording its first weekly decline since the announcement of reciprocal tariffs. Crude oil rebounded for two days, but US oil fell more than 2% in a week.

During the Asian session, the Shanghai Composite Index closed slightly lower, power stocks collectively surged, most treasury bond futures closed higher, the Hang Seng Tech Index rose sharply and then fell back, only rising 0.1%, and Horizon Robotics rose more than 3%.

### Key News

- **Chinese President**: Give full play to the advantages of the new national - system - style approach, adhere to self - reliance and self - strengthening, highlight the application - orientation, promote the healthy and orderly development of artificial intelligence, and concentrate efforts on tackling core technologies such as high - end chips and basic software.

- **Six Chinese Ministries and Commissions**: The starting point for departure - tax - refund has been reduced to 200 yuan, and the cash - refund limit has been increased to 20,000 yuan. The six ministries and commissions encourage all regions to set up more tax - refund stores in large - scale business districts, pedestrian streets, tourist attractions, resorts, cultural and museum venues, airports, passenger ports, hotels, etc., to expand the coverage of tax - refund stores. Relax the filing conditions for departure - tax - refund stores. On the basis of the current tax - credit levels of A and B, the filing conditions for departure - tax - refund stores are increased by level M, and new stores are allowed to become tax - refund stores on the premise of meeting other relevant regulations.

- **State Administration for Market Regulation**: All parties involved in the Changhe Port transaction shall not take any measures to avoid anti - monopoly review.

- **Nuclear Power Projects in China**: Nuclear power projects have been launched this year. The State Council executive meeting has approved 10 new units, driving investment of over 200 billion yuan.

- **Trump**: 200 agreements have been reached, the US - Japan agreement is "very close", and it is unlikely that tariffs will be postponed for another 90 days. The Trump administration is said to be planning to hold talks with 18 trading partners under a new framework for simplified negotiations by July 8. South Korea has urged "calm and orderly" negotiations with the United States, hoping to reach an agreement in early July.

- **Federal Reserve Financial Stability Report**: The valuations of various assets are at high levels, the yield on US bonds is high, and trade has become the top risk.

- **"New Fed News Agency"**: Some people have over - interpreted the speech of the President of the Cleveland Fed that "there may be a rate cut in June". Trump has made it "more difficult" for the next Fed Chairman.

- **Russia**: Russia said that Putin and the US envoy confirmed that Russia is willing to negotiate with Ukraine without preconditions, and the two sides discussed the possibility of resuming direct negotiations between Russia and Ukraine.

- **India and Pakistan**: There was a small - scale exchange of fire between India and Pakistan near the Line of Control in Kashmir on Thursday night. The Pakistani Defense Minister issued a "full - scale war" warning. Geopolitical conflicts escalated, and the Indian stock, bond, and exchange markets suffered a triple blow on Friday. India said that there was another exchange of fire in the Kashmir region on Friday night, which was not confirmed by Pakistan.

### Market Closing Reports

- **European and American Stock Markets**: The Dow Jones index rose 0.05%, the S&P 500 index rose 0.74%, and the Nasdaq index rose 1.26%, with weekly cumulative increases of 2.48%, 4.59%, and 6.73% respectively. The European STOXX 600 index closed up 0.35%, with a weekly cumulative increase of 2.77%.

- **China's A - share Market**: The Shanghai Composite Index fell 0.05%, the Shenzhen Component Index rose 0.39%, and the ChiNext Index rose 0.59%.

- **Bond Market**: By the end of the bond market on Friday, the yield on the 10 - year benchmark US Treasury bond was approximately 4.24%, down more than 7 basis points during the day and about 8 basis points in total for the week; the yield on the 2 - year US Treasury bond was approximately 3.75%, down nearly 5 basis points during the day and about 5 basis points in total for the week.

- **Commodities**: The June WTI crude oil futures closed up 0.37%, with a weekly cumulative decline of about 2.6%. The June Brent crude oil futures closed up 0.48%, with a weekly cumulative decline of about 1.6%. The June COMEX gold futures closed down 1.5%, with a weekly cumulative decline of 0.9%. The May COMEX copper futures closed down 0.33%, with a weekly cumulative increase of 2.1%.

### Details of Key News

- **Global Highlights**

- **Meeting of the Political Bureau of the Central Committee of the Communist Party of China**: Coordinate domestic economic work and international economic and trade struggles, and promptly introduce incremental reserve policies according to changes in the situation. According to Xinhua News Agency, the meeting emphasized that it is necessary to coordinate domestic economic work and international economic and trade struggles and unswervingly do our own things well. It is necessary to accelerate the construction of a new model for the development of the real estate industry, increase the supply of high - quality housing, optimize the policy for the acquisition of existing commercial housing, and continuously consolidate the stable situation in the real estate market; increase the proportion of unemployment insurance funds returned to stabilize employment for enterprises greatly affected by tariffs; promptly introduce incremental reserve policies according to changes in the situation, and strengthen extraordinary counter - cyclical adjustments; increase the income of low - and middle - income groups, and vigorously develop service consumption. Minsheng Securities believes that the April meeting of the Political Bureau of the Central Committee clearly signaled that "employment is the bottom line". Not only is "stable employment" placed at the top of the "four stabilities" (i.e., stable employment, stable enterprises, stable markets, and stable expectations), but "incremental reserve policies" and "stable employment" are also mentioned simultaneously. It is expected that "stable employment" will become the top priority of fiscal policies in the future. At the same time, the meeting of the Political Bureau of the Central Committee proposed that "for enterprises greatly affected by tariffs, the proportion of unemployment insurance funds returned to stabilize employment should be increased", and fiscally, efforts will be made to both hedge against the impact of foreign trade and support the bottom line of people's livelihood. Monetary policy will mainly undertake the functions of stabilizing the market and enterprises. CITIC Construction Investment said that this meeting of the Political Bureau of the Central Committee did not involve any statements about adjusting the budget or introducing large - scale incremental stimulus policies. The main reason is that there is still a large unused space in the current established policies, and there is no need to arrange incremental policies. It is expected that there will still be incremental fiscal policies in the second half of the year, and the time for their introduction is expected to be in the middle and late third quarter. First, the current fiscal space may have been fully utilized by then, and second, there is also past experience for reference.

- **General Secretary of the Communist Party of China and President of China**: When emphasizing the need to adhere to self - reliance and self - strengthening, highlight the application - orientation, and promote the healthy and orderly development of artificial intelligence during the 20th collective study of the Political Bureau of the Central Committee of the Communist Party of China. The General Secretary emphasized the need to give full play to the advantages of the new national - system - style approach, adhere to self - reliance and self - strengthening, highlight the application - orientation, and promote the healthy and orderly development of China's artificial intelligence in a beneficial, safe, and fair direction. It is necessary to continuously strengthen basic research, concentrate efforts on tackling core technologies such as high - end chips and basic software, and build an autonomous, controllable, and coordinated artificial intelligence basic software and hardware system. Use artificial intelligence to lead the transformation of the research paradigm and accelerate scientific and technological innovation breakthroughs in various fields.

- **China's Industrial Enterprises above Designated Size**: The profit of China's industrial enterprises above designated size in the first quarter increased by 0.8% year - on - year, turning from a decrease to an increase. China Galaxy Securities pointed out that the increase in quantity and the improvement in profit margin are the main reasons for the profit turning positive. "Rushing to export" and "rushing for the two new economies" have driven the expansion of both domestic and foreign demand. However, the impact of reciprocal tariffs on exports may begin to be felt from April.

- **Trump**: 200 agreements have been reached, the US - Japan agreement is "very close", and it is unlikely that tariffs will be postponed for another 90 days. Trump said that there are "100%" 200 agreements, and the agreements will be announced in the next three to four weeks. Some countries may come back to ask for adjustments, and he will consider it. Trump said that he will not lift a certain country's tariffs unless there is a substantial return. The S&P 500 gave up more than half of its gains, and the Dow Jones index returned to a downward trend, falling more than 100 points. The media said that the United States plans to adopt a simplified - negotiation template and hold talks with 18 major trading partners under the new - template framework by July 8. The scene of the US - Japan negotiations is delicate. Japanese representative Akazawa Ryo is wearing a MAGA hat to "show goodwill" to Trump. Akazawa is wearing a red hat with "Make America Great Again" (MAGA) printed on it. Sitting in the Oval Office, he gives a thumbs - up to the camera, with a big smile on his face. It seems that he is not here for "equal - footing negotiations" but to conclude a "treaty of surrender". South Korea has urged "calm and orderly" negotiations with the United States, hoping to reach a tariff agreement in early July. The media said that senior South Korean government officials such as the finance minister urgently went to the United States last week to seek to avoid potential trade blows. Trump said that without the United States, the Panama and Suez Canals would not exist, and US ships should be allowed to pass through for free.

- **Federal Reserve Financial Stability Report**: The valuations of various assets are at high levels, the yield on US bonds is high, and trade has become the top risk. The Federal Reserve believes that in the past six months, asset prices have fallen during periods of significant market turmoil, but the valuations of various assets, including the stock market and residential real estate, remain at high levels. The liquidity in the US bond and stock markets is low, and the situation has deteriorated since April, but the market is still operating in an orderly manner.

- **"New Fed News Agency"**: Some people have over - interpreted the speech of the President of the Cleveland Fed that "there may be a rate cut in June". Nick Timiraos said that the speech of Cleveland Fed President Hammack on Thursday has attracted widespread attention because some market participants are eager to draw an overly optimistic conclusion that this indicates that the Federal Reserve may be ready to cut interest rates as early as June. Hammack's core view is that the Federal Reserve will not rush to cut interest rates until it obtains more clear information about the economic outlook. The "New Fed News Agency" also said that Trump has made it "more difficult" for the next Fed Chairman. The market is worried that Trump's public belittling and pressure on Powell will bring an indelible "original sin" to Powell's successor. No matter who the next chairman is, the independence of the Federal Reserve will be in doubt.

- **Russia**: The assistant to the President of Russia said that Putin and the US envoy discussed the possibility of resuming direct negotiations between Russia and Ukraine on Friday. Peskov said that Putin and the US envoy confirmed that Russia is willing to negotiate with Ukraine without preconditions. Trump said that Russia and Ukraine are "very close" to reaching an agreement.

- **The United States and Iran**: The third round of indirect talks between the United States and Iran ended. Iran said after the meeting that there were still differences between the two sides. Iranian Foreign Minister Araghchi reiterated that this round of talks was limited to the nuclear issue, aiming to build trust in Iran's nuclear program in exchange for the lifting of sanctions. He pointed out that there were differences between the two sides at both the macro and detailed levels, and some of the differences were very serious. US media said that Trump expressed his willingness to meet with Khamenei or Pezeshkian, which is regarded as a "major strategic shift".

- **India and Pakistan**: There was a small - scale exchange of fire between India and Pakistan near the Line of Control in Kashmir. The Pakistani Defense Minister issued a "full - scale war" warning. Geopolitical conflicts escalated, and the Indian stock, bond, and exchange markets suffered a triple blow. The market was worried that India might take retaliatory actions and took profits before the weekend. India said that there was another exchange of fire in the Kashmir region on Friday night, which was not confirmed by the Pakistani government. The Pakistani military said that it killed 54 terrorists on Friday and Saturday nights.

- **Domestic Macroeconomy**

- **Nuclear Power Projects in China**: Nuclear power projects have been launched this year. The State Council executive meeting has approved 10 new units, driving investment of over 200 billion yuan. The State Council executive meeting emphasized that the development of nuclear power must ensure absolute safety. It is necessary to compact the main responsibility of the participating units and the owner units, build and operate nuclear power units in accordance with the highest global safety standards, continuously strengthen the construction of safety supervision capabilities, and effectively tighten the safety net for nuclear power.

- **Foreign Media**: The United States overestimates its bargaining chips, and "China holds five cards". According to the Global Times citing foreign media, China is the world's second - largest economy, which means that it can better withstand the impact of tariffs than other smaller countries. Its huge domestic market can relieve some of the pressure on exporters caused by tariffs.

- **Lin Yuan**: Gold has no value, and he will not invest even if it drops by half. It is not surprising that the total market capitalization of China's pharmaceutical industry will exceed that of the United States in the next 20 years, and the probability of the RMB depreciating in the long term is low.

- **Domestic Companies**

- **Baidu**: Baidu has released two new models, and the price is only 25% of that of DeepSeek. Li Yanhong said that without applications, chips and models are worthless. The input price of Wenxin Model X1 Turbo is 1 yuan per million tokens, and the output price is 4 yuan, which is only 25% of that of DeepSeek - R1. Li Yanhong said that some models represented by DeepSeek still have "pain points" such as single - modality, high hallucination, slow speed, and high price. Baidu released these two new models to solve these problems.

- **BYD**: BYD's revenue in the first quarter increased

BYD's revenue in the first quarter increased by 36.35% year-on-year, and its net profit soared by 100% year-on-year, with strong sales of electric vehicles. The new energy vehicle business remained robust, helping BYD's revenue in the first quarter increase by 36.35% year-on-year, the net profit attributable to the parent company increase by 100.38% year-on-year, reaching a new historical high for a single quarter, and the net profit after deducting non-recurring items increase by 117.80% year-on-year.

Great Wall Motor's net profit in the first quarter decreased by 45.6% year-on-year, and the decline in sales was caused by product upgrades.

Ping An Insurance (Group) of China's operating profit in the first quarter increased by 2.4% year-on-year, and the value of new life insurance business surged by 34.9%.

Everbright Bank released its first-quarter report. The high dividends attracted "important shareholders" to compete to "snap up shares", and the dividend yield distributed in the past 12 months reached 7.2%.

Oriental Fortune's revenue in the first quarter increased by 41.93% year-on-year, and its net profit increased by 38.96% year-on-year, with an increase in the trading volume of stocks and funds.

The net profit in the first-quarter report of Industrial Securities soared by 57%, and the company rolled out a "generous" dividend distribution plan, with the cash dividend distribution ratio reaching 52% in 2024.

North China Changchuang's revenue in the first quarter increased significantly by 37.9% year-on-year, and its net profit increased by 38.8%, driven by technological breakthroughs.

Wintech International's net profit in the first quarter increased significantly by 82%, and its semiconductor business became the growth engine.

China Telecom's net profit in the first quarter increased by 3.1% year-on-year, and the number of 5G users increased by 15.48 million net.

China Shenhua Energy Co., Ltd.'s revenue and profit both decreased in the first quarter, and its coal sales volume decreased by 15.3% year-on-year.

Overseas Macroeconomy

The impact of tariffs on the United States has already emerged: The truck transportation volume at the Port of Los Angeles plummeted by 23%, and large-scale layoffs are imminent. Affected by tariffs, the inbound cargo volume at the Port of Los Angeles, the largest port in the United States, has dropped sharply. A logistics industry CEO said that the truck transportation volume at this port has decreased by 23% year-on-year, and if the trade war is not resolved, it may drop to 50% in the coming weeks, and truck drivers will soon face large-scale layoffs. Some media pointed out that the significant decline in logistics volume may lead to the collapse of part of the warehousing industry chain in southern California.

Corporate CEOs have clearly stated: The tariff war will destroy everything. Due to the soaring costs brought about by Trump's tariff policies and the shake in consumer confidence, many giant American companies have intensively lowered their profit expectations since this earnings season, including Procter & Gamble, PepsiCo, Delta Air Lines, AT&T, NextEra Energy, etc., covering multiple fields such as consumer goods, aviation, energy, and telecommunications.

How did the previous high tariffs in the United States come to an end? Lu Zhengwei, Chief Economist of Industrial Bank, pointed out that the public's dissatisfaction with high prices, the opposition of domestic interest groups, and the countermeasures of trading partners may all lead to a turning point in trade protection. The inflection point of tariff policies is usually accompanied by fundamental changes in the monetary system, such as a significant depreciation of the US dollar or a significant increase in gold production.

The market is hotly discussing the maturity repayment pressure of US bonds. Is it really that big? CITIC Construction Investment Securities believes that the maturity repayment and new supply scale of US bonds are indeed not low, but there has been no marginal deterioration. The real issues that need attention are: The US corporate bond market is facing the dual pressures of maturity and deteriorating fundamentals; the real supply test of US bonds may come in the second half of the year when the debt limit is resolved and tax cuts are implemented. It is expected that the Federal Reserve will launch a new round of structural quantitative easing (QE) to cooperate.

What transactions do hedge funds conduct on US bonds? With 100 times leverage and a position of $1 trillion. Hedge funds' "relative value" transactions use high leverage to obtain huge returns from the small price differences of US bonds and their derivatives, such as "basis trading" or "swap spread trading". Their position size is as high as $1 trillion, and the leverage ratio is as high as 100 times. For example, hedge funds net shorted US$1.14 trillion of US Treasury bond futures in mid-March, and the scale of basis trading was about US$800 billion, which means that even an orderly withdrawal will have a considerable impact on the market.

The "glory days" of European stocks are over. Wall Street was collectively bullish on them a month ago, but now they are cutting their expectations one after another. After raising the ratings of European stocks one after another a month ago, about one-third of the strategists lowered their year-end target expectations in April. The uncertainties of US trade policies, the rise in volatility, and concerns about growth have become the main risk factors.

"Shadow Fed Chairman" Warsh voiced his opinion: The Federal Reserve has made a "systematic mistake" by indulging fiscal policies and pushing up inflation. Former Federal Reserve Governor Warsh was once a candidate for US Treasury Secretary considered by Trump and a potential successor to Federal Reserve Chairman Powell. His remarks have attracted particular attention in the current debate on US monetary policy.

Overseas Companies

Tesla once rose by more than 10%. The market speculated that it would launch new cars in India, and the Trump administration would relax the regulation of autonomous driving. Media reports said that the Trump administration would relax the regulation of autonomous driving, and the new regulations hit the core of Tesla's demand. In addition, Tesla refunded the early reservation users in India, which inspired the market's speculation that Musk would launch new cars in India. Tesla closed up 9.8%.

The two technology giants most "severely impacted by tariffs" will release their earnings reports after the market closes on Thursday. Amazon relies heavily on Asian suppliers and retailers, while Apple may benefit in the short term due to consumers' early purchase behavior but will face pressure in the long term.

In the past four weeks, AI inference has boomed, GPUs are in high demand, and NVIDIA's products are still in short supply. Under the negative impacts such as continuous supply constraints and pressure on gross profit margins, Morgan Stanley slightly lowered NVIDIA's target price from $162 to $160. In the long run, it believes that NVIDIA's growth trajectory remains strong.

Elon Musk's xAI is negotiating to raise $20 billion, and its valuation is expected to exceed $120 billion. If the financing is successfully completed, it will become the second largest startup financing round in history, second only to OpenAI's $40 billion financing earlier this year.

Report: Intel's 18A chip may be adopted by major manufacturers such as NVIDIA and Broadcom. According to reports, Intel's most cutting-edge manufacturing process Intel 18A, which is about to enter mass production, will not only be used in its internal products but also receive foundry orders from several ASIC manufacturers including NVIDIA and Broadcom. Supply chain sources said that these customers are optimistic about Intel 18A.

There is a "hidden mystery" in Google's earnings report: A mysterious investment has quietly appreciated by $8 billion. A company invested by Google brought it an unrealized gain of $8 billion in the first quarter. This income is quite substantial compared to its profit of $35.5 billion, but Google hardly mentioned the reason in its earnings report. Some analysts believe that Anthropic, Databricks, or Stripe are the most likely "suspects".

Industry/Concepts

1. Duty-free: Based on the Japanese penetration rate (16.4%) and average customer spending ($5,000) model, CITIC Securities estimates that China's outbound tax refund sales are expected to reach 109 billion yuan in the medium to long term. With the continuous relaxation of policies, in-depth technological penetration, and consumption upgrading, the outbound tax refund market is expected to become a key engine for boosting inbound tourism and the回流 of consumption. It is expected that by 2030, the market scale may exceed one trillion yuan, forming a multi-level pattern with the Hainan Free Trade Port as the leader, first-tier cities as the support, and second- and third-tier cities as the supplement.

2. Nuclear power: Analysts believe that as the core pillar of the low-carbon energy system, nuclear power is facing the dual opportunities of global energy transformation and technological breakthroughs. China has adjusted its nuclear power development policy from "steadily promoting" to "actively, safely, and orderly developing". The European Union, the United States, Japan, and other countries have also supported the resumption of nuclear power construction through policies, and the global installed capacity is expected to double by 2030.

3. Intelligent agents: Analysts believe that intelligent agents (Agents), as the core carriers of artificial intelligence (AI) and automation technologies, are reshaping social production and living patterns. They are defined as software and hardware entities (such as software robots, autonomous driving vehicles, industrial robots, etc.) that can perceive the environment, make autonomous decisions, and execute goals. With the breakthroughs in technologies such as multimodal interaction and reinforcement learning, intelligent agents are evolving from single-task execution to complex system collaboration.

4. Virtual power plants: Huatai Securities said that with the increase in the proportion of distributed new energy sources, power resources are growing rapidly at the local and county-level grid regulation levels. The pressure on power balance no longer exists only in the main grid, and it is urgent to expand the capacity of the distribution network to improve its ability to accommodate charging piles and distributed energy sources. As a new type of business entity that aggregates demand-side resources to participate in grid regulation and market transactions and promotes the coordination between supply and demand, virtual power plants are developing rapidly.

5. AI in government affairs: Minsheng Securities believes that the popularity of DeepSeek has accelerated the process of domestic AI implementation. Recently, Shenzhen's launch of the "AI + Government Affairs Assistant" has significantly improved the efficiency of government affairs work and has also attracted widespread social attention. China's government affairs informatization market has broad space, including a large number of professional vertical fields such as government procurement, finance, taxation, and justice, and it also connects B-end and C-end users. The space for improving efficiency and reducing costs brought by AI empowerment is relatively large. In addition, the construction rhythm of the government affairs informatization system is mostly driven from top to bottom. Under the wave of embracing AI throughout the year, AI + government affairs is expected to be implemented more quickly.

Preview of Today's Key News

The 15th meeting of the Standing Committee of the 14th National People's Congress will be held in Beijing from April 27th to 30th.

The State Council Information Office will hold a press conference on policies and measures for stabilizing employment, stabilizing the economy, and promoting high-quality development.

The regular press conference of the China Council for the Promotion of International Trade in April.

Huawei Innovation Data Infrastructure Forum.

Canadian general election voting.

Earnings reports of domestic companies such as Haitian Flavor Industry, Kunlun Wanwei, Transsion Holdings, WuXi AppTec, Tsingtao Brewery, BOE Technology Group Co., Ltd., Shanghai Electric Group Co., Ltd., Mindray Medical International Limited, Hengli Hydraulic Co., Ltd., Poly Developments and Holdings Group Co., Ltd., China Petroleum & Chemical Corporation, Zhang Xiaoquan Co., Ltd., China State Construction Engineering Corporation Limited, SF Holding Limited, Jiangsu Expressway Company Limited, Robam Appliances Inc., BeiGene - U, and Vatti Corporation Limited.

Earnings reports of overseas companies such as Domino's Pizza and NXP Semiconductors.

Disclaimer: The views expressed in this article only represent the personal views of the author and do not constitute investment advice from this platform. This platform does not make any guarantees regarding the accuracy, completeness, originality, and timeliness of the information in the article. Nor does it assume any liability for any losses arising from the use of or reliance on the information in the article.

PREVIOUS：Indian stocks, bonds and exchanges are three NEXT：This week's major schedule: US and Europe's f