CITIC Securities believes that since the second quarter of 2026, the growth rate of fixed asset investment and physical workload indicators have once again declined rapidly. In May of this year, the cumulative deficit size of China's first and second fiscal accounts recorded negative growth for the first time compared to the previous year. Looking ahead to the second half of the year, the growth rate of China's fixed asset investment is expected to pick up significantly, driven by factors such as accelerated fiscal expenditure, accelerated issuance and use of new policy financial instruments, and the low base effect. From a structural perspective, based on the experience of using new policy financial instruments in 2025, the next 800 billion yuan of new policy financial instruments may be invested mainly in transportation, electronics, electricity and utilities, power equipment, and new energy. Considering China's investment expansion space in AI-related fields from a comparative perspective between China and the US, the share of US AI-related investment in fixed asset investment is about 10.2%, China is only 1.2%, and China still has great room for expansion. This week, the market is focusing on June's PMI data and the first execution of an overnight reverse repurchase operation, and next week on China's price and financial data for June.

CITIC Securities believes that since the second quarter of 2026, the growth rate of fixed asset investment and physical workload indicators have once again declined rapidly. In May of this year, the cumulative deficit size of China's first and second fiscal accounts recorded negative growth for the first time compared to the previous year. Looking ahead to the second half of the year, the growth rate of China's fixed asset investment is expected to pick up significantly, driven by factors such as accelerated fiscal expenditure, accelerated issuance and use of new policy financial instruments, and the low base effect. From a structural perspective, based on the experience of using new policy financial instruments in 2025, the next 800 billion yuan of new policy financial instruments may be invested mainly in transportation, electronics, electricity and utilities, power equipment, and new energy. Considering China's investment expansion space in AI-related fields from a comparative perspective between China and the US, the share of US AI-related investment in fixed asset investment is about 10.2%, China is only 1.2%, and China still has great room for expansion. This week, the market is focusing on June's PMI data and the first execution of an overnight reverse repurchase operation, and next week on China's price and financial data for June.