China Merchants Securities: How will overseas interest rate repricing be arranged later?

The Zhitong Finance App learned that China Merchants Securities released a research report saying that the core conflict in the market this week focused on overseas interest rate repricing and the divergence of domestic industry sentiment. US non-farm payrolls have exceeded expectations, and the market's focus has turned to inflation. Interest rates on US bonds and the US dollar are still under upward pressure in the short term. Domestic A-share earnings continued to improve in the second quarter, but the industry was clearly divided. Energy supply risks are driving up crude oil and chemicals, reflecting supply shocks rather than a full recovery in demand. AI industry profits are rapidly migrating from hardware to software and applications. In terms of allocation, it is recommended to balance structural growth and dividends, and focus on improving AI computing power, overseas travel, and undervaluation.

The main views of China Merchants Securities are as follows:

Observation and discussion of the city

Overseas interest rates will be repriced, how will they be arranged in the future? Overseas, the US non-agricultural sector significantly exceeded expectations in August. The unemployment rate remained at 4.1%. The market focus was shifting from employment to inflation. Interest rates on US bonds and the US dollar are still under upward pressure in the short term, and the global equity market may continue to fluctuate; subsequent inflection points depend on inflation data, the September interest rate meeting, and the situation between the US and Iran. Meanwhile, recent energy supply risks have driven a structural rise in commodities. Crude oil has become the core anchor, and price increases have spread to chemical intermediates, putting pressure on precious metals and photovoltaic materials. On the domestic side, A-share revenue and profit growth accelerated in the second quarter, and the share of overseas revenue continued to rise, but industry differentiation was still obvious. In terms of industry trends, major overseas models have been intensively updated, technological congestion in the A-share market continues to decline, and the market is still trading on the “hard cut and soft” logic. The overall narrative space for technology has not improved, but profits may be redistributed in the industrial chain. In terms of configuration, it is recommended to maintain a balanced combination of “structural growth+dividends”, focusing on AI computing power chains, offshore chains, and undervaluation improvement directions, and focusing on marginal improvement tracks such as semiconductors, overseas computing power, chemicals, agriculture, and robotics.

Review · Interior

The main reasons for the fluctuation and adjustment in the A-share market this week include: (1) rising overseas liquidity pressure, rapid rise in US bond yields, and adjustments in the global bond market. The yield on US 10-year Treasury bonds was once close to 4.8%, and the yield on 30-year US Treasury bonds rose to about 5.28%, compounding the size of US debt, inflation expectations, and concerns about rising energy prices, suppressing global risk asset valuations. (2) AI hardware transactions have entered a stage of differentiation, and funds continued to be disbursed in the direction of early boom, but the AI application side was still supported by industry catalysts, and media, skits, and AI videos undertook part of the funding. (3) Market hot spots are rapidly rotating, and low levels such as agriculture and military industry are strengthening in stages. Among them, pig farming was driven by the removal of sows capable of breeding and pig price restoration expectations. The military industry was affected by risk aversion in the market and became an important funding direction during the adjustment period, but turnover continued to decline, and the index lacked sustained upward momentum.

Mesoscope/Scenery

The manufacturing PMI increased month-on-month in August, and pork prices rose. The main areas where the economy improved this week were: 1) rising prices of coal, crude oil, and most chemicals in resource products; 2) TMT continued to be high, and DDRM prices continued to rise. In July, the three-month rolling year-on-year increase in North American PCB shipments and orders increased; 3) pig prices improved and vegetable prices rose. We recommend coal, chemicals, chemicals, pharmaceuticals, agriculture, forestry, animal husbandry and fishing, semiconductors, banks, etc. that are booming or improving.

Funding and widowhood

Net ETF purchases, net outflow of financing, decline in fund issuance. The total net outflow of financing capital in the first four trading days was 2.71 billion yuan; 4.99 billion shares were newly established, down 740 million shares from the previous period; the net purchase of ETFs corresponds to a net inflow of 10.87 billion yuan. The financing capital is net purchases of machinery and equipment, basic chemicals, construction materials, etc.; there are more subscriptions for information technology ETFs, and more redemptions for brokerage ETFs. The scale of net holdings reduction for important shareholders has shrunk, and the scale of planned holdings reduction has declined.

Themes/Trends

OpenAI, Anthropic, and Google have successively released the latest models. Competition for major overseas models is clearly heating up again this week: OpenAI released GPT-6 Astra on September 4, Anthropic launched Claude Fable 5.1 and Claude Mythos 5.1 on September 2, and Google released Gemini 3.8 Flash on the same day. The three leading manufacturers completed a new round of flagship or flagship model updates in a very short period of time. Judging from the common trends of the three models, actual production efficiency has become an important standard for measuring the value of cutting-edge models, and scientific research capability is one of the segments that the flagship model is most concerned about. At the same time, the product lines of different manufacturers are further divided: OpenAI enhances computer operation capabilities, Anthropic continues to cultivate Agent, and Google relies on the Flash series to enhance the balance between performance, speed, and cost.

Data and Valuation

The overall A-share valuation level this week is lower than last week. The Wandequan A Index PE (TTM) is 17.2, down 0.5 from last week, and is in the 63.4% fraction of the historical valuation level. Index valuations fell mostly this week. Among them, light manufacturing, building decoration, and media had the highest gains, while electronics, construction materials, and military industries had the highest declines.

Risk warning: Economic data fell short of expectations, policy understanding was incomplete, and overseas policies were tightened beyond expectations.