Mini Program: Daily Investment Bank/Institution Opinion Summary

Foreign

Bank of America: Expects November non-farm employment to significantly exceed previous values.

Bank of America economists stated that the employment report for November will be released on Friday, and investors should pay attention to the growth rate for the two months, especially considering the risk of significant revisions to the October data. A Wall Street Journal survey indicates that U.S. non-farm employment in November is expected to increase by 214,000, higher than the 12,000 in October. Bank of America expects this number to exceed 240,000 due to the impacts of hurricanes and Boeing's strike. It is also expected that the labor force participation rate will rebound, causing the unemployment rate to rise from 4.1% to 4.2%, in line with the Wall Street Journal's expectations. The Bank of America stated that under the influence of hurricanes, the number of unemployment claims has increased but subsequently decreased, indicating a rapid economic recovery.

Citi: The impact of South Korea's martial law may be short-lived.

Citi research analysts stated in a report that the sudden implementation of martial law in South Korea may have a short-term negative impact on the economy and financial markets. Although the pressure of capital outflow will increase and pose an upward risk to the USD/KRW exchange rate—especially considering the recent reduction in positions—uncertainty surrounding the political and economic environment may quickly ease due to the 'proactive policy response' from the Bank of Korea and policymakers. For example, the Korean Finance Minister has promised to provide unlimited liquidity when necessary to stabilize the financial markets. Citi added that once matters are resolved, policymakers may increase fiscal support, although this means that spending will increase over a longer period.

Deutsche Bank: If OPEC+ delays the production increase, oil price response may be neutral.

Analysts at Deutsche Bank stated that if OPEC+ decides to further delay the market's expected production increase plan, oil prices may respond moderately. OPEC+ is expected to decide on Thursday to postpone the increase in production for another three months, until the end of the first quarter. However, some uncertainties still exist. The UAE has been allowed to gradually increase its daily output by 300,000 barrels starting next January. Analysts find it hard to imagine that the voluntary production cut agreement will continue to be fully implemented for three months while allowing one country to increase output. As traders await the results of the OPEC+ meeting on Thursday, Brent crude and WTI crude rose 1.7% and 1.9% during the day, reaching $73.05 per barrel and $69.39 per barrel, respectively.

Caitong Macro: The South Korean farce occurs during a period of low sentiment, and may have had precursors.

Caitong Macro economist Thomas Matthews stated that amid the turmoil in South Korea's political situation, market sentiment is in a difficult period. Policymakers have been struggling to address the 'Korean discount'—the valuation gap between South Korean assets and those in other regions. This gap reflects, to some extent, the turbulent political situation, and it seems to have widened even before the recent events occurred. The valuation gap between the MSCI Korea Index and the MSCI All Country World Index has reached its highest level in nearly 20 years. However, if the crisis can be avoided, we have reason to be more optimistic. Low inflation and the seemingly dovish Bank of Korea provide favorable conditions for bonds. In the past year, earnings per share have been growing rapidly and are expected to continue to grow, with major technology companies benefiting from artificial intelligence. If sentiment towards South Korea does indeed shift, it could be very dramatic, but perhaps more water has already flowed under the bridge (meaning the situation is now set).

Mitsubishi UFJ: Political uncertainty in South Korea may persist, President Yoon's term appears to be coming to an end.

Mitsubishi UFJ analyst Michael Wan stated that political uncertainty in South Korea may continue as parliament votes against President Yoon Suk-yeol's sudden declaration of martial law. The opposition may propose impeachment against President Yoon today. President Yoon's term appears to be coming to an end, with his approval rating at its lowest. South Korea is already one of the countries most vulnerable to the tariffs proposed by elected U.S. President Trump. Recent developments may further raise the risk premium of the Korean won, at least until we clarify political stability.

Caitong Macro: South Korea's overall economy still faces risks.

Caitong Macro analysts Mark Williams and Gareth Leith stated: Although the South Korean market and currency may have somewhat recovered, the overall economy still faces risks. Given that this (declaration of martial law) is such a shocking move, it is likely to overshadow the economic outlook until the political situation stabilizes. The astonishing nature of President Yoon Suk-yeol's actions cannot be overemphasized... These events will greatly undermine investors' confidence in the South Korean economy and its financial markets.

Saxo Bank: Trump's tariffs may benefit cryptocurrencies and gold.

Saxo Bank strategist John Hardy stated that if the tariffs proposed by U.S. President Trump lead other countries to seek alternatives to the dollar, the cryptocurrency market and gold may benefit. Tariffs will have a terrifying impact on global trade as they cut off the necessary supply of dollars. BRICS countries may trade using gold-backed digital currencies. Cryptocurrency stablecoins linked to gold may also be utilized. The cryptocurrency market could quadruple, exceeding $10 trillion, while the dollar may depreciate by 20% against major currencies and depreciate by 30% relative to gold.

Swiss Bank: The widening spread of French government bonds is a political issue, not a debt issue.

Swiss Bank Group research analyst Dario Messi stated that the recent widening of the yield spread between French government bonds and those of other countries reflects a political risk premium, rather than real concerns about debt sustainability at this stage. France's political instability is unlikely to disappear quickly, which could historically lead to fluctuations in sovereign bond spreads, especially relative to the spreads of German bonds. Nevertheless, the current fundamental budget deficit is too high and must be reduced. However, the actual debt interest rates remain very low and are rising very slowly, and are not expected to significantly exceed the nominal growth rate in the medium term. This should limit market concerns about debt sustainability.

Domestic

CITIC Securities: Export controls prohibit exports to the U.S., enhancing the strategic status of metals.

CITIC Securities research report believes that on December 3, 2024, the Ministry of Commerce announced that it decided to strengthen the export control of relevant dual-use items to the United States, prohibiting the export of dual-use items to U.S. military users or for military purposes, and as a principle, not permitting the export of gallium, germanium, antimony, and ultra-hard material-related dual-use items to the U.S. Currently, China is the world's largest producer of gallium, germanium, and antimony, and export controls on key metal resources are expected to enhance their strategic position, which is of significant strategic importance for maintaining national security and interests. We do not rule out the possibility that subsequent export control policies may extend to tungsten, rare earth, and other strategic metal varieties, and suggest paying attention to investment opportunities related to these metals.

CITIC Securities: Four industry associations call for chip localization, with significant guiding effects.

CITIC Securities report points out that on December 3, 2024, China's semiconductor/automotive industry/internet/communication industry associations collectively issued a statement firmly opposing the U.S. export restrictions against China, stating that relevant chip products from the U.S. are no longer safe and reliable, calling for the active use of chips manufactured by domestic and foreign-funded enterprises in China. The report believes that the call of the four industry associations has a significant guiding effect, and it is expected that other industries will follow suit, further accelerating the overall pace of localization in the domestic semiconductor industry, and additionally benefiting the manufacturing sector.

CITIC Construction Investment: 10-year Treasury yield falls below 2%, outlook for year-end and early next year bond market liquidity changes.

CITIC Construction Investment Securities' report comments on the 10-year Treasury yield falling below 2% during the session: Since mid-November, long-end rates and credit bonds have experienced a relatively smooth decline. The policy stimulus and peak bond issuance that the market was once worried about have all landed, but the primary market has appropriately absorbed most of the issuance through bidding, leading to a rapid decline in interest rates. Additionally, the non-bank funding situation continues to recover, pushing down both interest rates and credit spreads significantly. Looking at December alone, as rates approach the psychological level of 2%, some fluctuations are inevitable, maintaining long positions while incrementally increasing in small wave segments. Looking ahead to next year, the configuration situation has not significantly changed, and after the configuration plate joins at the year-end, the downward trend of interest rate bonds may be smoother.

Haitong Securities: Optimistic about the steady rise of rare earth prices.

Haitong Securities research report believes that rare earth prices have completed their bottom adjustment, and the price rebound reflects the support of rare earth smelting production costs. In the context of demand recovery, we are optimistic about the steady rise of rare earth prices. The supply pattern of rare earths is improving, with domestic supply growth slowing, and significant increases from abroad unlikely in the short term. Additionally, the formal implementation of the rare earth management regulations will further strengthen supply constraints. Meanwhile, the demand related to new energy continues to grow, with robots expected to become the next demand hotspot. In terms of inventory, the recovery of downstream demand has led to a decrease in the inventory of rare earth downstream products such as dysprosium iron, metallic praseodymium neodymium, and sintered neodymium iron boron.

Huatai Securities: The construction of a nationwide unified electricity market is accelerating, optimistic about three main lines.

Huatai Securities research report believes that the construction of a nationwide unified electricity market is accelerating, optimistic about three main lines. The nationwide unified electricity market will provide an important mechanism foundation for China to build a new power system and enhance the capacity for renewable energy consumption, helping to solve spatial issues in the bottleneck of renewable energy consumption. Continuing to be optimistic about the structural growth of wind power demand, ongoing construction of the main grid at high voltage and ultra-high voltage levels, and the accelerated transformation and upgrading of distribution networks under the background of the construction of a new type of power system. Among them, the flexibility of the power grid brings the need for upgrading and remodeling the distribution network. As the proportion of distributed renewable energy increases, the power resource increases at the level of regional and county dispatch, and the pressure for power balance is no longer solely on the main grid, necessitating the expansion of distribution networks to enhance the capacity for charging piles and distributed energy accommodation. Meanwhile, the ecosystem of distribution networks has changed, making the integration of source, grid, load, and storage at the distribution level more economical, requiring more intelligent controls to achieve 'four availabilities,' and favorable for smart meters and distribution transformers.

Galaxy Securities: 5G applications are expected to develop on a large scale, preferring quality targets with improving marginal prosperity.

Recently, the Ministry of Industry and Information Technology and others jointly issued the (5G Large-Scale Application 'Sail' Action Upgrade Plan), aiming to continuously enhance the industrial full-chain support, network full-scenario service capability, and ecological multi-level collaborative power for large-scale 5G applications, fully promoting 5G to achieve broader, deeper, and higher-level multi-dimensional empowerment. Galaxy Securities research report believes that 5G applications are expected to develop on a large scale, preferring quality targets with improving marginal prosperity in the telecommunications sub-industry. The (Sail Upgrade Plan) systematically promotes relevant work for the large-scale application of 5G around the four upgrades of application, industry, network, and ecology, strengthening multi-level collaborative innovation in the telecommunications industry chain.

Article forwarded from: Jinshi Data