1. Macroeconomic policies
Six major collective official announcements! Further introduce measures that benefit enterprises and the people, increase cost reduction and profitability
According to Daily Economic News, following the collective voice in response to the initiative of the China Banking Association in early this month, on October 30th, the six major state-owned banks, namely Industrial and Commercial Bank of China, Agricultural Bank of China, Bank of China, Construction Bank, Bank of Communications, and Postal Savings Bank, once again issued a collective announcement, announcing that they will further introduce measures that benefit enterprises and the people, increase cost reduction and profitability, and improve service quality and efficiency on the basis of existing policies. The "transcripts" of the six major state-owned banks in the third quarter of this year have all been released, achieving a total net profit attributable to the parent company of 1.05 trillion yuan, a year-on-year increase of 2.51%. As of the end of September, the non-performing loan ratios of the six major state-owned banks were all below 1.38%, and there was no growth.
Securities Daily: The net interest margin of commercial banks is expected to "bottom out"
Although there was downward pressure on the net interest margin of many commercial banks in the third quarter, it is not realistic for the banking industry's net interest margin to continue to narrow in the future. Many factors are expected to support the net interest margin of commercial banks to "bottom out". Firstly, there is limited space for the net interest margin to continue to decline. Secondly, regulatory authorities have made it clear that commercial banks need to maintain a reasonable level of net interest margin. Thirdly, as China's macroeconomic recovery continues, financing demand is expected to continue to recover, and the space for further downward loan interest rates is expected to narrow. Fourthly, since the beginning of this year, the deposit listing rates of commercial banks have been lowered multiple times, which is not only conducive to avoiding idle arbitrage of funds in the financial system, but also helps to alleviate the downward pressure on net interest margin.
In October, a total of 24 provinces will issue special refinancing bonds totaling approximately 1010.2 billion yuan
According to Yicai, a total of 24 provinces will issue special refinancing bonds totaling approximately 1010.2 billion yuan throughout October, which will be used to repay local existing debts. This is also widely believed by the market to be used to repay implicit debts that the government is responsible for, thereby extending the debt term, reducing interest burden, and achieving the goal of mitigating local government debt risks. This is also an important measure taken by the central government recently to mitigate the risk of local government debt in a package.
Hard core "domestic products are available for sale at a price of 999999 yuan, which can only be seen but cannot be purchased
According to Yicai, a 5G chip with the code CMRI8676 has been launched on Taobao Mall. The product image introduces the chip as "Breaking Wind 8676", which is "China's first commercial reconfigurable 5G frequency transceiver chip". It is understood that the chip was independently developed by China Mobile Research Institute and successfully developed at the end of August this year. The chip is currently integrated in the complete equipment of multiple communication hardware equipment manufacturers, and will play an important role in the next stage of low-cost and highly controllable 5G commercial network construction represented by network devices such as cloud base stations, pico stations, and home stations.
Last week, the trading volume of second-hand houses in Shenzhen increased by 12% month on month. The industry expects the market to remain relatively stable in the later stage
According to China Securities Network, according to statistics from the Shenzhen Real Estate Intermediary Association, last week (October 23-29), the second-hand housing market in Shenzhen experienced a surge in supply and demand, with a transaction volume (including self-service) of 968 units, an increase of 12.4% month on month, and a slight rebound in the recorded volume of second-hand housing. According to the Shenzhen Housing Association, based on the three consecutive weeks of recorded volume after the Double Festival, the market has stabilized at a certain level, and there has been no continuous decrease in recorded volume after the release of concentrated demand. It is expected that the market will also maintain relative stability in the later stage.
Moderate to severe pollution processes occur in the Beijing Tianjin Hebei and surrounding areas, expert interpretation
According to CCTV, starting from October 22nd, there has been a PM2.5 pollution process in the Beijing Tianjin Hebei and surrounding areas. Currently, the level of pollution has reached moderate to severe. The expert team organized by the National Joint Center for Air Pollution Prevention and Control explained that the activity level of industrial enterprises, heavy trucks, and the number of straw fire spots in the Beijing Tianjin Hebei and surrounding areas have increased month on month, indicating an increasing trend in pollution emissions. Since late October, regional industrial electricity consumption has increased by about 5% compared to the first and middle of October, with more significant increases in electricity consumption in industries such as cement and bricks. In addition, the recent unfavorable meteorological conditions in the Beijing Tianjin Hebei and surrounding areas are prone to pollution accumulation and transformation. At present, cities in the region are actively taking action to address the pollution process, and a total of 20 cities have launched heavy pollution weather warnings. With the arrival of cold air, the pollution process will end on November 3rd.
People's Daily Bell: Promoting the Real Stability and Improvement of Sino US Relations
Adhering to mutual respect, peaceful coexistence, and win-win cooperation is China's consistent policy towards the United States. China always believes that the two countries should be partners rather than opponents, and believes that China and the United States should benefit and win together rather than a zero sum game. We always look forward to the stability and improvement of China US relations rather than sliding towards conflict and confrontation. China has always believed that it is necessary to break away from the logic of competition and confrontation, take into account each other's interests and concerns, seek the maximum common denominator for communication and cooperation, and draw the maximum concentric circle for win-win cooperation. Currently, China US relations are at a critical crossroads. Both sides should adhere to the three principles of mutual respect, peaceful coexistence, and win-win cooperation to truly stabilize and improve China US relations. I hope that the United States and China will continue to work towards this direction.
2. Fixed income/foreign exchange
On October 27th, the CFETS RMB exchange rate index was at 99.6, down 0.09 from last week
According to data from the Foreign Exchange Trading Center, on October 27th, the CFETS RMB exchange rate index was at 99.6, a decrease of 0.09 compared to last week; The BIS currency basket RMB exchange rate index closed at 104.36, up 0.05 from last week and reaching a new high since April 2023; The SDR basket RMB exchange rate index closed at 94.19, up 0.07 from last week. On Monday, the central parity rate of the Chinese yuan against the US dollar was at 7.1781, an increase of 1 basis point. Traders stated that the middle price quotation shows that the regulatory authorities' attitude towards stabilizing market exchange rate expectations remains firm. Apart from the performance of economic data from China and the United States, the regulatory authorities' movements are still a short-term focus of attention.
Regular first week of corporate debt conversion: 16 new acceptance projects with high rating of issuing entities
According to Securities Daily, it has been a week since the Shanghai Shenzhen North Exchange accepted the review of corporate bonds. On October 23-29, the Shanghai Shenzhen North Exchange accepted 16 new corporate bonds, with a total planned issuance amount of 62.4 billion yuan. The credit ratings of project issuers are all above AA+, mostly AAA level. Last week, the Shanghai Stock Exchange issued feedback on some existing translated corporate bonds. Overall, corporate bonds are included in the regulatory framework for corporate bonds, but they also retain the characteristic of "funds following projects". In addition, due to the need for some translation projects to modify application materials according to new regulations, short-term new issuance may be limited, and the subsequent scale may gradually increase.
The potential of RMB as a financing currency is enormous, and the market prospects for "panda bonds" are promising
According to Shanghai Securities News, in the first three quarters, the issuance of "Panda Bonds" (RMB bonds issued by overseas institutions in China) and "Dim sum bonds" (RMB denominated bonds issued by various institutions in Hong Kong, China) grew strongly, soaring to RMB106.4 billion (up 45.8% year on year) and RMB167.1 billion (up 179.3% year on year) respectively. The rising popularity of "Panda Bond" and "Dim sum bond" reflects the strengthening of the attribute of RMB as a financing currency. This is not only due to the current low interest rate environment in the RMB market, but also closely related to the continuous promotion of openness in China's financial market.
III. Commodities/Stock Market
Two top public fund companies have announced self purchase and their self purchase amounts have further increased compared to August this year
According to China Securities News, following the announcement of self purchase by E Fund, China Merchants Fund has also joined the self purchase trend. The self purchase amount of two top public fund companies has further increased compared to August this year. Industry insiders have stated that the current market is particularly concerned about sources of incremental funds, and self purchase of public funds can inject liquidity into the market and boost market confidence. Self purchase is also an effective means to deeply connect the interests of fund companies, fund managers, and the interests of the foundation.
BYD's net profit for the third quarter was 10.413 billion yuan, a year-on-year increase of 82.16%
BYD announced a net profit of 10.413 billion yuan in the third quarter, an increase of 82.16% year-on-year; The net profit for the first three quarters was 21.367 billion yuan, a year-on-year increase of 129.47%.
Longji Green Energy: Net profit in the third quarter of 2023 decreased by 44.05% year-on-year, and the chairman plans to increase his holdings by 100-150 million yuan
Longji Green Energy announced that its net profit for the third quarter of 2023 was 2.515 billion yuan, a year-on-year decrease of 44.05%; The net profit achieved in the first three quarters was 11.694 billion yuan, a year-on-year increase of 6.54%. On the same day, it was announced that Chairman Zhong Baoshen planned to increase his holdings of the company's shares by 100 million to 150 million yuan, with no price range set for this increase.
Ganfeng Lithium Industry: Net profit in the third quarter decreased by 97.88% year-on-year
Ganfeng Lithium announced a net profit of 160 million yuan in the third quarter, a year-on-year decrease of 97.88%. On the same day, it was announced that Ganfeng Lithium Battery, a subsidiary of the company, plans to invest in the construction of a lithium battery production base project in the Economic and Technological Development Zone of Nanchang City. The project will be divided into three phases, with the first phase constructing an annual production capacity of 5GWh energy storage PACK battery production base, with a planned investment amount of no more than 2 billion yuan. The second and third phases of the project will timely start the investment and construction of power battery and energy storage battery production bases based on market conditions.
Tsinghua University's development of ultra high-speed optoelectronic computing chips has a computing power that exceeds 3000 times that of current high-performance commercial chips
According to Cailian News Agency, Tsinghua University has developed ultra high-speed optoelectronic computing chips with computing power exceeding 3000 times that of current high-performance commercial chips. Academician Dai Qionghai from the Department of Automation at Tsinghua University and others have jointly researched and proposed a new computing architecture that breaks free from Moore's Law. The optoelectronic analog chip has a computing power that is more than 3000 times that of current high-performance commercial chips. In actual measurement, the system level computing power of optoelectronic fusion chips has increased by thousands of times compared to existing high-performance chip architectures, and the materials used are simple and easy to obtain, with a cost of only tens of times that of the latter.
4. Company and Industry
Ministry of National Security: Hundreds of illegal meteorological observation stations transmitting data to the outside world
According to the official WeChat account of the Ministry of National Security, in recent years, the national security organs have carried out special measures for foreign-related meteorological observation in accordance with the law, investigated more than 10 overseas meteorological equipment agents, inspected more than 3000 foreign-related meteorological stations, and found that hundreds of illegal foreign-related meteorological observation stations transmit real-time meteorological data to overseas, widely distributed in more than 20 provinces across the country, posing risks and hidden dangers to China's national security. These illegal foreign-related meteorological observation stations, some of which are directly funded by foreign governments, and some observation points are set up around sensitive sites such as military units and military enterprises for altitude approval and GPS positioning; Some are located in my main grain producing areas, and correlation analysis is conducted on my crop growth and grain yield; Some even transmit long-term, high-frequency, and multi-point real-time data to foreign official meteorological agencies, serving foreign homeland security and meteorological monitoring.
The dust of the 2023 automobile industry strike in the United States has settled, and the union organization UAW has hinted that it will target Tesla in the future
According to Sina, the American Automobile Federation (UAW) is currently considering a plan to organize another industry wide strike in 2028, when the labor agreement contract expires. The Chairman of the UAW stated that after reaching a temporary agreement with the three major automakers (Ford, Stellantis, and General Motors), the unions can strike on International Labor Day on May 1, 2028, inviting unions across the United States to coordinate the expiration date of the contract and strike together. The next strike negotiation will not only involve the Big Three, but also the Big Five or Big Six. Some media commented on this, stating that Fain has clearly stated which car company he will target for his next action, and for UAW, Tesla is a particularly attractive target.
Biden signs an executive order to issue the White House's first generative AI regulation
According to the report, on October 30th local time, US President Biden signed a "landmark" executive order to introduce the first set of regulatory regulations for generative artificial intelligence from the White House. According to administrative orders, multiple government agencies in the United States need to establish standards to prevent the use of artificial intelligence to design threats such as biological or nuclear weapons, and to seek the best methods for verifying content such as "watermarks" and develop advanced cybersecurity plans. Specifically, the command requires testing of artificial intelligence products and reporting the test results to the federal government. It also proposes to attract global artificial intelligence talents to stay in the United States. According to multiple media reports, the administrative order requires companies running cloud services to inform the government of their foreign customers.