Global Macro

1. JPMorgan Chase expects the Federal Reserve to cut interest rates by 25 basis points in November, down from a previous expectation of 50 basis points.

2. On October 4th local time, the European Union held a vote on whether to impose a five-year anti-subsidy tax on Chinese electric vehicles. A statement released by the European Commission showed that the proposal to levy tariffs on Chinese imported pure electric vehicles received the necessary support from EU member states during the vote. The statement said that the EU and China continue to work on exploring alternative solutions that must fully comply with WTO regulations, adequately address the damaging subsidies identified by the Commission's investigation, and be monitorable and enforceable. The day before, German Chancellor Scholz indicated to the outside world that Germany would oppose the new tariffs proposed by the EU on Chinese electric vehicles in the vote held on the 4th. Before the vote that day, Hungarian Prime Minister Orban stated that the current EU economic strategy represents an "economic cold war." On October 4th last year, the European Commission initiated an anti-subsidy investigation into electric vehicles imported from China, and on July 4th this year, it began to impose provisional anti-subsidy taxes on Chinese electric vehicles. On August 20th, the EU released the final draft of the anti-subsidy investigation on Chinese electric vehicles, showing a proposed anti-subsidy tax of 17% to 36.3% on Chinese electric vehicles.

3. From the National Data Bureau, it is understood that guidelines for promoting the high-quality development of the data industry are currently open for public comment. The draft for comments proposes the development of the "National Data Standard System Construction Guide." The data industry is an emerging industry that utilizes modern information technology for the development of products or services based on data resources. In 2023, the national data industry scale exceeded 2 trillion yuan. The draft for comments mentions cultivating data resource enterprises, strengthening data technology enterprises, supporting data service enterprises, optimizing data application enterprises, developing data security enterprises, and expanding data infrastructure enterprises. The goal set forth in the draft for comments is that by 2029, China's data industry scale will have an average annual compound growth rate of over 15%, with a significantly optimized data industry structure.

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4. European Central Bank (ECB) Governing Council member Centeno said on Friday that the European labor market is beginning to cool, which is worrying as it may lead to investment and growth below average levels. He also stated that inflation in the eurozone has been brought under control. The market is betting that the ECB will accelerate the pace of interest rate cuts on October 17th, as last month's inflation rate fell below 2%, and the eurozone is trying to avoid a recession. Centeno said, "Europe's growth problem is at the core... we are now beginning to see the first signs of concern in the labor market." He noted that job vacancies created by European companies have decreased by 20% compared to two years ago, and the number of new hires by companies is 10% lower than the peak in the second quarter of 2022, "which coincides with when the ECB began to raise interest rates."

5. On the 4th local time, the European Union's statistical office released data on EU imports of high-tech products for 2023. The EU imported high-tech products worth a total of €478 billion that year, a slight decrease from 2022. High-tech product exports amounted to €461 billion. The data shows that in 2023, nearly one-third of the EU's high-tech product imports came from China, accounting for 32% of the total value of €155 billion. Electronic telecommunications equipment accounts for the largest share of the EU's high-tech imports from non-EU countries, with China being the largest partner. In addition, computers and office equipment as well as pharmaceutical products each account for 15% of high-tech imports, mainly from China and the United States, respectively.

6. An article in the Economic Daily pointed out that the call to "boost the capital market" is precisely aimed at the current situation, timely responding to the market's call, and using the capital market as a lever to boost confidence, stabilize expectations, and promote development as a pragmatic strategy and strategic move. The capital market is a place for trading expectations, and the key to boosting the capital market is to boost expectations. Based on the current situation, it is urgent to quickly introduce a batch of policies and measures that can be implemented and produce practical effects. Relevant departments have taken various measures, announcing the reduction of reserve requirement ratios, outstanding mortgage loan interest rates, and the down payment ratio for second homes, creating structural monetary policy tools to support the capital market, etc., with a series of policy "combination punches" working in联动 to bring tangible benefits and play a role in repairing market expectations and stimulating trading enthusiasm. It is hoped that subsequent financial policies can strengthen linkage and joint efforts with fiscal policies, accurately focus on key issues of concern to investors and the market, and promptly implement a batch of targeted and operable reform measures to jointly care for the stable and healthy operation of the market.

Stock Market Dynamics

1. Citing EPFR Global data, Bank of America reported that global emerging market equity funds recorded an inflow of $15.5 billion for the week ending October 3rd, the second-highest on record. The Chinese stock market had an inflow of $13.9 billion for the week, the second-highest on record. For the past 18 weeks, emerging market equity funds have continuously received inflows. So far this year, inflows into the Chinese stock market have reached $114 billion, with India receiving $21.3 billion and outflows from Brazil amounting to $3 billion. The data shows that emerging market fixed income saw an inflow of $100 million for the week, marking the third consecutive week of inflows.

2. Shares of lithium mining company Arcadium surged by more than 30% after hours, following reports that Rio Tinto is in talks to acquire the company.3. The three major U.S. stock indices closed higher collectively, with the Dow Jones Industrial Average up 0.81%, accumulating a 0.09% increase for the week; the Nasdaq Composite up 1.22%, accumulating a 0.1% increase for the week; the S&P 500 up 0.9%, accumulating a 0.22% increase for the week. Large-cap technology stocks rose broadly, with Tesla gaining over 3%, Amazon and Meta up over 2%, Nvidia up over 1%, and Apple and Google with gains of less than 1%. Cruise lines, airline companies, and automobile manufacturers led the gains, with JetBlue Airways up over 14%, American Airlines up over 6%, Norwegian Cruise Line up over 4%, Delta Air Lines up nearly 4%, Carnival Corporation up over 3%, and Toyota Motor and Honda Motor up over 2%.

4. The Nasdaq Golden Dragon China Index closed up 3.05%, accumulating an 11.85% increase for the week, with Miniso up over 8%, JD.com up over 5%, XPeng up over 3%, and Li Auto, NIO, and Baidu up over 1%.

5. The Securities and Futures Commission of Hong Kong issued a statement, indicating that there has been good progress in the enforcement actions taken against "pump and dump" schemes. Another suspected key member of an organized "pump and dump" group was arrested in Singapore and handed over to Hong Kong, where they were prosecuted for securities fraud. 33-year-old Hong Kong resident Chen Qianying was taken to the Eastern District Court in Hong Kong today and charged with conspiracy to use a fraudulent or deceptive scheme in securities transactions under sections 300 of the Securities and Futures Ordinance and sections 159A and 159C of the Crimes Ordinance.

6. The iShares China Large-Cap ETF rose 3.5% on Friday, closing at its highest level since February 22, 2022, with a weekly increase of 11%. The iShares MSCI China ETF rose 3.7%, closing at its highest level since March 2, 2022, with a weekly increase of 11.8%.

7. The U.S. Commodity Futures Trading Commission (CFTC): For the week ending October 1, the net speculative long position in COMEX gold futures decreased by 5,881 contracts to 248,960 contracts. The net speculative long position in COMEX silver futures decreased by 7,708 contracts to 38,379 contracts. The net speculative long position in WTI crude oil futures decreased by 23,860 contracts to 99,950 contracts. The net speculative long position in COMEX copper futures increased by 4,023 contracts to 41,127 contracts.

Corporate News

1. According to data disclosed by the Hong Kong Stock Exchange today, Innovent Biologics was collectively reduced by 3.25 million shares by its founder, executive director, chairman of the board, and chief executive officer, Yu Decheng, on September 30 and October 2, with a total amount of approximately HKD 152 million. After the reduction, Yu Decheng's shareholding ratio decreased from 7.90% to 7.70%, and the number of shares held decreased to approximately 125.97 million shares.

2. On Friday morning in the Eastern Time Zone, the stock price of Rivian Automotive, an American electric vehicle startup, fell after the company announced that its third-quarter vehicle deliveries were below analysts' expectations and lowered its annual production forecast for 2024. The company reduced its 2024 production target from 57,000 vehicles to a range of 47,000 to 49,000 vehicles. Rivian Automotive stated that the reduction in production targets was due to "production disruptions caused by shortages of shared components" for its R1 vehicles and commercial vans. Rivian Automotive said in a statement, "The impact of this supply shortage began in the third quarter of this year, has become more severe in recent weeks, and will continue to exist. Due to the supply shortage, Rivian now revises its annual production target guidance for 2024 to between 47,000 and 49,000 vehicles."

3. Danish pharmaceutical company Novo Nordisk announced on Friday, local time, that it will invest 864 million reais ($158.2 million) to revamp a factory in Brazil, which produces a quarter of Novo Nordisk's global insulin output. Novo Nordisk said in a statement that the funds will be used for a comprehensive overhaul of the factory located in Monteiro Lobato, Minas Gerais, in southeastern Brazil, and to implement sustainable development projects at the site.

4. Meta Platforms (META.US) announced on Friday that the company has developed a new artificial intelligence model called Movie Gen, which can create realistic video and audio clips based on user prompts, and claims that it can compete with tools from leading media generation startups such as OpenAI and ElevenLabs. Samples of Movie Gen's work provided by Meta show videos of animals swimming and surfing, as well as dynamic videos generated using real photos of people. Meta stated that Movie Gen can also generate background music and sound effects synchronized with the video content and use the tool to edit existing videos.Industry Observations

1. US WTI crude oil closed higher by 0.9% on Friday, marking a weekly increase of over 9%, the largest single-week gain in over a year. Traders are concerned that Israel may launch an attack on Iran's crude oil facilities in retaliation for the large-scale ballistic missile attack on Israel earlier this week by Tehran. The November delivery of West Texas Intermediate (WTI) crude oil futures on the New York Mercantile Exchange rose by 67 cents, a 0.9% increase, to settle at $74.38 per barrel. Last Friday, the futures closed at $68.18 per barrel. Based on this calculation, the futures price has risen by $6.20, an increase of 9.09%, marking the largest single-week increase since March 2023.

2. According to data released by Cores on Friday, a subsidiary of the Spanish Ministry of Energy and Environment, Spain's crude oil imports from Venezuela this year have reached the highest level since 2009. In August, Spain imported 303,000 tons of crude oil from Venezuela, with the total imports for the year so far exceeding 2 million tons. This is slightly below the 2.1 million tons for the same period in 2009. Venezuela, an OPEC member, saw its oil exports reach a high level in August, but power outages and equipment failures led to a decline in oil exports in September.

3. On October 4th, according to the Shanghai Tourism Big Data Monitoring, Shanghai received a total of 12.217 million visitors during the first four days of the National Day holiday. The average hotel occupancy rate was 62.5%, an increase of 11 percentage points year-on-year. The Shanghai Municipal Administration of Culture and Tourism revealed that during the National Day period, Shanghai continued to launch integrated products of culture, commerce, tourism, sports, and exhibitions, continuously enriching and optimizing market supply, effectively stimulating holiday market consumption vitality, and meeting the spiritual and cultural needs of the people.

4. Centaline Property stated on its website that during the week of September 23rd to 29th, the Centaline City Leading Index, which measures the prices of second-hand homes in Hong Kong, fell by 1% week-on-week to 135.86. Data shows that this is the first decline in the leading index since the week of September 8th.

5. France's industrial production month-on-month rate in August was 1.4%, higher than the expected 0.2%, with the previous value revised from -0.50% to 0.2%. France's industrial production year-on-year rate in August was 0.5%, with the previous value at -2.20%. France's manufacturing output month-on-month rate in August was 1.6%, with the previous value at -0.90%. France's manufacturing output year-on-year rate in August was 0.3%, with the previous value at -3.00%.

Financial Data

1. At the end of trading on Friday in New York, the CME Bitcoin futures BTC main contract was reported at $62,720.00, up 2.80% from Thursday's close in New York, with a cumulative decrease of 5.17% for the week, trading in the range of $66,400.00 to $60,070.00. Spot Bitcoin has fallen by 5.33% over the last seven natural days, temporarily reported at $62,308.72, trading in the range of $66,253.44 to $59,861.50. The CME Ethereum futures DCR main contract was reported at $2,440.00, up 3.41% from Thursday, with a cumulative decrease of 10.43% for the week, trading in the range of $2,691.00 to $2,316.50.

2. After the US September non-farm employment data exceeded expectations, US Treasury bonds fell, pushing yields up by 7 to 16 basis points. Traders reduced their expectations for significant rate cuts by the Federal Reserve for the remainder of the year. The yield on the two-year Treasury note once surged by 16 basis points to 3.87%, and the yield on the ten-year Treasury note rose by 9 basis points to 3.94%. Swap market pricing indicates that traders expect only a 27 basis point rate cut by the end of November and a 55 basis point rate cut by the end of the year. This is a significant retreat compared to the bets before the data release that expected a 66 basis point rate cut for the remaining time of the year.

3. Short-term UK government bonds further declined, and the yield curve flattened. The UK two-year government bond yield soared by 15 basis points to 4.12%, the largest increase since May 22nd. Traders are betting that the Bank of England will cut rates by 39 basis points before the end of the year, down from the previous expectation of 42 basis points. The market also implies that there will be 131 basis points of easing policy by the end of 2025, previously at 150 basis points. German government bonds, like French and Italian bonds, narrowed their losses, with the German ten-year government bond yield rising by 7 basis points to 2.22%, with a peak level of 2.24%. Traders are betting that the European Central Bank will cut rates by 51 basis points before the end of the year, down from the previous expectation of 53 basis points.4. The world's largest gold ETF, SPDR Gold Trust, holds 876.26 tons, a decrease of 1.15 tons compared to the previous trading day. The world's largest silver ETF, iShares Silver Trust, has increased its holdings by 21.27 tons, with the current holding amount reaching 14,508.57 tons.

5. After seven consecutive weeks of climbing, India's foreign exchange reserves have exceeded $700 billion for the first time in history, mainly due to valuation gains and central bank purchases of US dollars. Data released by the Reserve Bank of India on Friday shows that as of the week ending September 27th, India's foreign exchange reserves stood at $704.89 billion, an increase of $12.6 billion, marking the largest single-week increase since mid-July 2023. India is the fourth economy in the world to have foreign exchange reserves exceeding $700 billion.

6. The Italian National Institute of Statistics: Italy's public deficit as a percentage of GDP in the second quarter was 3.4%.