Morning News

**Source**: Wall Street Insights

**Market Overview**

Tech stocks once again propelled U.S. equities higher, with the three major indexes notching a three-day winning streak to embrace the "Christmas rally", as the S&P 500 neared a record high. Tesla surged nearly 4% intraday, hitting a new all-time high for the second time in less than a week. NVIDIA gained 1.5%, Oracle rose over 3%, and Micron Technology jumped 4%, extending its post-earnings rally to more than 20% in three days. Paramount Global, which is competing with Netflix for an acquisition backed by Larry Ellison, climbed over 4%, while acquisition target Warner Bros. Discovery advanced 3.5%, and Netflix fell over 1%. Dominion Energy dropped nearly 4% after its wind power project was halted by the Trump administration.

Demand for the 2-year U.S. Treasury note auction was weak, with Treasury yields hitting a fresh daily high following the release of auction results. The U.S. Dollar Index snapped its three-day winning streak and pulled back from a one-week high. Japanese senior officials issued intervention signals, driving a rebound in the Japanese yen after it plummeted over 1% last Friday. The offshore yuan broke above the 7.03 level intraday for the first time in 14 months. Bitcoin rose over 3% intraday to reclaim the $90,000 mark, before erasing most of its gains later.

Gold, silver and copper all set new all-time highs. Gold surged over 2% intraday to hit a fresh peak for the first time in two months. Silver and LME copper notched consecutive daily record highs, with spot silver jumping as much as 3% and LME copper extending its winning streak to four days. Reports indicated that the U.S. is ramping up efforts to block Venezuela's oil exports, sending crude oil higher for four straight sessions to a more-than-one-week high, with an intraday gain of nearly 3%.

During the Asian trading session, A-shares and Hong Kong stocks opened higher and moved upward. The ChiNext Index rallied over 2%, led by strength in precious metals, CPO and intelligent driving sectors. Tuojing Technology's market capitalization topped 100 billion yuan, and Shanghai silver futures continued to set new highs.

**Top News**

- China's LPR unchanged for seventh consecutive month: The 5-year and above LPR stood at 3.5% in December, while the 1-year LPR remained at 3%.

- People's Bank of China: Personal credit records can be repaired in one go for single overdue amounts under 10,000 yuan, with the rule taking effect on January 1 next year.

- Ministry of Commerce of China: Provisional countervailing measures will be imposed on certain imported dairy products originating from the EU starting December 23.

- Trump-endorsed Fed governor Christopher Waller: The U.S. faces recession risks if the Federal Reserve does not continue cutting interest rates next year. A 2025 Fed voter struck a hawkish tone, stating that rate cuts are unnecessary in the coming months and November's CPI data was underestimated.

- Trump unveiled a "Gold Fleet" plan, including the construction of a warship bearing his name, with the first vessel expected to be completed in 2028. The plan also calls for an increase in the number of aircraft carriers.

- Japanese senior officials issued their sternest warning to date: The Finance Minister stated that the government has "discretionary power" to tackle forex speculation and will take bold actions. The Vice Finance Minister warned against "sharp and one-sided" exchange rate fluctuations.

- Report: NVIDIA's GB300 shipments are expected to reach 55,000 units next year, with Vera Rubin200 slated to hit the market in Q4 2025. NVIDIA reportedly restructured its cloud team and will no longer directly compete with Amazon.

- A major power outage in San Francisco caused chaos for Google's sister company Waymo's driverless cars, while Tesla emerged as a big winner with its stock hitting a new all-time high.

- Warner Bros. acquisition battle escalated: Paramount Global directly competes with Netflix for the takeover, backed by Larry Ellison's personal guarantee of $40.4 billion, sending its shares up over 4%.

- Vanke's 2 billion yuan bond rollover plan failed to pass, with the grace period extended to 30 trading days.

**Market Closing Quotes**

- **U.S. & European Equities**: S&P 500 rose 0.64% to close at 6,878.49; Dow Jones Industrial Average gained 0.47% to 48,362.68; Nasdaq Composite advanced 0.52% to 23,428.829. Europe's STOXX 600 Index fell 0.13% to 586.75.

- **A-shares**: Shanghai Composite Index climbed 0.69% to 3,917.36; Shenzhen Component Index rose 1.47% to 13,332.73; ChiNext Index surged 2.23% to 3,191.98.

- **Bond Market**: By the end of the trading session, the yield on the 10-year U.S. Treasury note stood at around 4.16%, up about 1 basis point intraday; the 2-year U.S. Treasury yield was at approximately 3.51%, rising nearly 3 basis points on the day.

- **Commodities**: WTI Crude Oil Futures (February contract) closed up 2.63% at $58.01 per barrel; Brent Crude Oil Futures (February contract) gained 2.64% to $62.07 per barrel. COMEX Gold Futures (February contract) rose 1.87% to $4,469.4 per ounce; COMEX Silver Futures (March contract) advanced about 1.6% to $68.565 per ounce. LME Copper closed up nearly 0.4% at $11,925 per ton; LME Nickel gained around 3.2% to $15,276 per ton; LME Tin fell over 0.6% to $42,947 per ton.

# Detailed Headlines

## Global Highlights

1.  China's LPR Remains Unchanged for the Seventh Consecutive Month: In December, the over - 5 - year LPR stood at 3.5%, and the 1 - year LPR was 3%. A research report from Soochow Securities pointed out that regarding monetary policy, the possibility of a reserve requirement ratio (RRR) cut or interest rate reduction within this year is low. However, the People's Bank of China can inject liquidity through various means such as open market operations, outright reverse repos, and government bond trading in the open market. Market analysis suggests that the next interest rate cut may take place in early next year.

2.  People's Bank of China: One - time Personal Credit Repair Available for Single Overdue Amount Below 10,000 Yuan, Taking Effect on January 1 Next Year. The People's Bank of China has issued a new policy to offer individuals a "one - time credit repair" opportunity. According to the policy, for personal credit overdue records incurred between January 1, 2020 and December 31, 2025, with a single overdue amount of less than 10,000 yuan, as long as the full amount of the arrears is repaid by March 31, 2026, the credit reporting system will automatically remove the relevant records. The entire process does not require an application and is free of charge.

3.  China's Ministry of Commerce: Provisional Countervailing Measures on Relevant Imported Dairy Products Originating from the EU to Take Effect on December 23. An announcement from the Ministry of Commerce stated that the investigation authority has initially determined that relevant imported dairy products from the EU are subsidized, which has caused material injury to China's domestic dairy industry, and there is a causal relationship between the subsidies and the material injury.

4.  Trump - Endorsed Fed Governor Milan: U.S. Faces Recession Risk If Fed Fails to Continue Cutting Rates Next Year. Milan stated on Monday, "I don't think an economic recession will occur in the short term". Nevertheless, the rising unemployment rate should prompt the Federal Reserve to continue cutting interest rates. He added that the unemployment rate may have risen beyond expectations, and this data will push the Fed to adopt a dovish stance. He reaffirmed that if no one is appointed by the end of January, he will remain in his post as a Fed governor. Other recently speaking Fed officials have been more cautious than Milan, including Hammack, a 2025 Fed voter who advocated a pause in interest rate cuts in an interview released last Sunday.

5.  2026 FOMC Voter Strikes Hawkish Tone: No Need for Rate Cuts in Coming Months, November CPI Underestimated. Loretta Mester, President of the Federal Reserve Bank of Cleveland and a 2026 FOMC voter, said that the Fed does not need to cut interest rates at least until next spring, and the November CPI inflation data may be distorted, thus underestimating the actual price increases. Although Hammack believes that the current policy rate is at an appropriate level near neutral, she tends to adopt a slightly more restrictive stance to put more pressure on inflation.

6.  Trump Unveils "Gold Fleet" Plan Including a Warship Bearing His Name, First Vessel Expected to Be Completed in 2028. Trump announced the approval of a plan for the U.S. Navy to build two brand - new warships, and the U.S. will also increase the number of aircraft carriers. He said that the Navy will build a new "Trump - class" warship. This is part of the White House's efforts to modernize the Navy's surface fleet and revitalize the domestic shipbuilding industry. Earlier, U.S. Navy senior official Phelan stated that the new frigate fleet, codenamed FF (X), will be built by HII in Newport News, Virginia, and designed based on its "Legend - class" patrol ships.

7.  Japanese Senior Officials Issue Sternest - Ever Warning; Finance Minister Says Has "Discretionary Power" to Tackle FX Speculation, Will Take Bold Actions. Atsushi Mimura, Japan's Vice Finance Minister in charge of foreign exchange affairs, said that recent exchange rate fluctuations have been "sharp and one - sided", and the government will take appropriate actions to address excessive volatility. Coupled with the expectation of the Koga government's aggressive fiscal stimulus, which has pushed the yield on Japan's 10 - year government bonds to a 27 - year high, the market expects Japan may intervene in the foreign exchange market again when volatility intensifies.

8.  Asset Management Giant Apollo Enters "Risk - Averse Mode": Hoarding Cash, Deleveraging, Waiting for "Bad Things to Happen"? Apollo's CEO has warned of overvalued asset prices and growing geopolitical risks. The company has significantly increased cash reserves, reduced leverage, sold high - risk assets such as AI loans and collateralized loan obligations (CLOs), and its subsidiary insurance company has cut its CLO exposure to 200 billion US dollars. Apollo also warned that offshore regulatory arbitrage may trigger systemic risks in the insurance market, and the company is preparing for potential market volatility.

9.  Defaults, Bad Debts, and Redemption Waves Keep Emerging, U.S. "Trillion - Dollar Private Credit Story" Is Collapsing. The myth of "stable returns" once promised by Wall Street to retail investors is crumbling. The stock prices of business development companies (BDCs) under top institutions such as KKR and BlackRock have plummeted by more than 30%, the non - performing loan ratio has soared to 5%, and valuation fraud scandals have emerged frequently. High - interest - rate products once packaged as "safe havens" are now putting retail investors' principal safety to the test, and JPMorgan Chase CEO Jamie Dimon's warning about "cockroaches" in the credit market is coming true one by one.

10. Metals Rally! Gold, Silver, and Copper Hit New Highs Together; Platinum, Palladium, and Gold All Soar. Against the backdrop of surging geopolitical risks and repricing of expectations for Fed interest rate cuts, metal assets have become one of the most concentrated destinations for capital.

11. Report: NVIDIA GB300 Shipments to Reach 55,000 Units Next Year; Vera Rubin200 Slated for Q4 2025 Shipment. The latest market forecast shows that NVIDIA's GB300 AI server cabinets will focus on shipments to hyperscale data lakes and cold data archiving next year, and the market size is expected to grow at a rate of about 15% in the next three years.

## Alpha Summit

1.  Liu Chenming (GF Securities): Reject Traditional Macroeconomics, Look at 2026 Layout Window from Debt Resolution and Profit Structure Changes. Liu Chenming stated that the core logic for global asset pricing in 2026 is "debt resolution", and AI and resource commodities are essentially different manifestations of the same macro path. At present, the profit structure of A - shares has undergone a qualitative change, with the proportion of emerging industries and overseas business rising to 40%, making the stock market break away from the traditional macro "barometer" logic. He is optimistic about the "slow bull" market driven by the recovery of return on equity (ROE) in 2026, and pointed out that as the main - line sectors have corrected to a reasonable level, the period from December to January next year is a key layout window.

2.  Xue Zizhao (MiniMax): AI Large Models Are Not a "Money - Burning Game", Domestic Large Models Are Severely Undervalued. Xue Zizhao said that domestic large - model companies such as MiniMax are technically close to and even surpass their U.S. counterparts in some fields, and the gap is continuously narrowing, but their valuations still differ by two orders of magnitude. The valuations of these U.S. companies may be 100 times that of Chinese companies, but their technology is only 5% ahead, and their investment may be 50 to 100 times higher. In contrast, domestic companies have higher R&D efficiency but are severely undervalued.

3.  Professor Fang Yue: If AI Fails to Achieve Large - Scale Implementation, the Market May Repeat the 2000 Internet Bubble. Fang Yue, Director of the CEIBS AI and Management Innovation Research Center, believes that AI is a technology, but technology does not equal value, and large - scale implementation is the key. If AI technology can generate value through large - scale applications, it will bring about excellent changes in productivity. Future competition will not be a simple efficiency competition, but a competition in the degree of "human - machine integration".

## Domestic Macroeconomy

1.  Li Qiang Presides Over Meeting of the Leading Group for Compiling the Draft Outline of the 15th Five - Year Plan, Stresses Promoting New Quality Productivity. Li Qiang, while chairing a meeting of the Leading Group of the State Council for Compiling the Draft Outline of the 15th Five - Year Plan, emphasized the need to thoroughly study and implement the spirit of the important speeches made by the General Secretary of the CPC Central Committee and further improve the compilation of the 15th Five - Year Plan Outline, with Ding Xuexiang in attendance. Efforts should be made to develop new quality productivity and achieve breakthrough progress in promoting scientific and technological innovation, accelerating the cultivation of new growth drivers, and promoting the optimization and upgrading of the economic structure. It is necessary to further clarify tasks and measures, refine and specify the strategic tasks identified in the 15th Five - Year Plan proposals to make the plan more in line with development needs. It is also essential to plan a number of major projects, programs, and carriers that can drive overall development, which will not only accumulate new growth drivers and cultivate competitiveness for future development, but also provide support for expanding domestic demand and stabilizing economic operation at present.

2.  Dan Bin, Chairman of Oriental Harbor: "AI Bubble Theory" Is Noise, Stay Away from Margin Trading. According to The Paper, Dan Bin emphasized that the risk of missing out on the opportunities of the times is far greater than the concern about bubbles, and the AI revolution is a cycle that will last for more than ten years. He is optimistic about China's advantages in AI application scenarios and global industrial chain opportunities. His investment advice focuses on high - quality enterprises or exchange - traded funds (ETFs), and he particularly stressed that "never engage in margin trading" is a red line for investment, stating that it is difficult to suffer losses if you do not borrow money to buy good companies.

## Domestic Companies

1.  In - depth Analysis of IPO Prospectuses of AI Large - Model Unicorns: MiniMax to C - end, Zhipu AI to B - end. MiniMax has bet on C - end super applications, with paid users exceeding 1.77 million and its gross profit margin turning from negative to positive at 23%. Zhipu AI has focused on B - end on - premise deployment, serving 8,000 institutions with a gross profit margin as high as 50%. Both companies have invested several times their revenue in R&D. Backed by top - tier capital such as Alibaba and Tencent, they have taken completely different commercialization paths of To - C and To - B. In addition, giants including Alibaba, Tencent, and Mihoyo are among the shareholders of both companies.

2.  Moore Threads, Muxi, Biren, and Iluvatar CoreX! "Four Dragons of Domestic GPUs" Gather for IPO. Although the four companies are in the same track, their differentiated paths have become very clear: from a platform - based strategy pursuing a full - function ecosystem, to an engineering capability focusing on single - quarter profits, and then to a cluster route bound to national - level computing power hubs, each company is seizing the chip market share through different approaches.

3.  Three - Flower Intelligent Control: Net Profit Expected to Surge 25% - 50% in 2025 Driven by Dual Growth Engines. Three - Flower Intelligent Control expects its net profit to reach 3.874 billion to 4.649 billion yuan in 2025, a year - on - year increase of 25% - 50%. The company said that the two major business segments have worked in synergy, providing solid support for the company's full - year performance growth. In the refrigeration and air - conditioning electrical components business, Three - Flower Intelligent Control has continued to demonstrate its dominant position as an industry leader. As the company's second growth curve, the auto parts business, especially in the field of new energy vehicle thermal management, has performed particularly well.

# Overseas Macroeconomy

Trump Appoints Special Envoy to Greenland; Former U.S. Diplomat: Ridiculous! According to Xinhua News Agency, Trump announced last Sunday that he would appoint Jeff Landry, Governor of Louisiana, as the U.S. Special Envoy to Greenland. Landry claimed he would make this Danish autonomous territory "part of the United States". Michael McFaul, former U.S. Ambassador to Russia, criticized the appointment as "absurd", comparing it to "Mexico appointing a special envoy to make Louisiana part of Mexico".

Veteran Commodities Trader: Concerns Over "Second Wave" of Inflation Emerge; 1970s - Style Inflation Wave May Repeat. A former commodities trader warned that against the backdrop of expanding fiscal spending, the ebb of globalization, and lingering supply - side constraints, inflation may stage a "second - wave" rebound similar to that in the 1970s. Although it may not return to the 2021 highs, inflation consistently above 2% is sufficient to roil the market on its own. He argued that long - term bonds face the greatest risks, while equities, real estate, and commodities—especially industrial metals and energy—are likely to be more effective inflation hedging tools in the current environment.

Bank of America CEO: AI's Driving Effect on the Economy Is Gradually Emerging. Brian Moynihan pointed out that AI investment is gradually "gaining momentum", providing significant marginal support to the U.S. economy, and its impact will continue to amplify in the coming years. Even if the AI industry experiences a phased correction, its impact on the macroeconomy will be relatively limited. Bank of America forecasts that the U.S. economy will maintain strong growth next year, with a growth rate of 2.4%. While the job market is slowing down, overall risks are manageable.

# Overseas Companies

"Computing Profit Margin" Doubles from 35% to 70% in Less Than Two Years; Can OpenAI Actually Be Highly Profitable? Reports indicate that OpenAI's "computing profit margin" has surged from approximately 35% to 70% in less than two years, demonstrating significant progress in controlling the operational costs of its AI models. The substantial increase in computing profit margin means the company generates more revenue from every dollar spent on servers. In a recent podcast interview, CEO Sam Altman stated bluntly: "If we didn't keep increasing training costs significantly, we would have been profitable a long time ago."

"Illusions" Undermine "Reliability"! Salesforce Executive Says "Trust in Large Models Has Declined", Usage Reduced. Salesforce has encountered multiple technical challenges with large models in practical applications. When given more than 8 instructions, large models start to miss some of them, which is not ideal for tasks requiring precise processing. In addition, AI is prone to "drift", where "when users ask irrelevant questions, AI agents lose focus on their core objectives".

Google Doubles Down on Data Centers Again: Parent Company Acquires Energy Partner Intersect for $4.75 Billion. The acquisition, expected to be completed in the first half of next year, aims to help Google secure more power supply for its data centers, addressing the challenge that the aging U.S. power grid struggles to meet the first - of - its - kind surge in electricity demand in decades driven by AI, new factories, and the comprehensive electrification of the economy. Alphabet CEO Sundar Pichai stated that Intersect will assist the company in expanding production capacity, operating more flexibly when building new power generation capacity in sync with the load of new data centers, and reimagining energy solutions.

# Industries/Concepts

1. **Dairy Industry** | According to the website of the Ministry of Commerce, after more than a year of prudent investigation, preliminary evidence shows that the EU has provided substantial subsidies to agriculture - related sectors including the dairy and dairy product industry through subsidy programs such as the Common Agricultural Policy. During the investigation period, China's domestic industry has faced operational difficulties due to the impact of imported subsidized dairy products from the EU. The investigation authority preliminarily determined that relevant dairy products from the EU are subsidized, causing material injury to China's domestic industry, and a causal relationship exists between the two. In light of this, the Ministry of Commerce issued a preliminary ruling announcement on December 22, 2025, determining that the ad valorem subsidy rates for EU companies range from 21.9% to 42.7%, and decided to impose provisional countervailing measures.

**Commentary**: China Securities Journal pointed out that China's dairy industry is transforming from "quantity growth" to "quality improvement" and will maintain steady growth in the future. Health - orientation, functionalization, and digitalization have become the core driving forces. Niche segments such as low - temperature fresh milk, functional dairy products, and cheese will lead the industry's new growth. The market size is expected to reach 709.2 billion yuan in 2025 and exceed 1.2 trillion yuan by 2030, benefiting mainly from consumption upgrading, rising health awareness, and policy support.

2. **Power Grid Equipment** | According to the website of Pacific Gas and Electric Company, a large - scale power outage occurred in San Francisco, California on the 20th, affecting approximately 130,000 households and businesses, accounting for about one - third of the company's total customers in the city. At present, the cause of the power outage in most areas remains unclear. According to the San Francisco Fire Department, a fire broke out inside a substation of Pacific Gas and Electric Company in the city on the afternoon of that day, triggering partial power outages.

**Commentary**: Guolian Minsheng Securities believes that the fragility of North America's power grid is a long - standing historical problem. On one hand, the U.S. power grid is aging and in need of replacement; on the other hand, power grids in each state are independent, lacking dispatching capabilities. Since 2023, driven by the demand for new energy grid connection and manufacturing reshoring, the demand for power equipment such as transformers in the U.S. has been in a persistent shortage. In addition, the current explosive demand on the load side and the increasing construction of data centers have exerted pressure on the power supply and consumption ends, further boosting the demand for transformers.

3. **6G** | According to China Securities Journal, U.S. President Trump recently issued a memorandum titled *Winning the 6G Race* to senior officials of his administration. The recipients of the memorandum include the U.S. Secretary of State, Secretary of Defense, Secretary of Transportation, Secretary of Energy, Secretary of Homeland Security, and other officials. The memorandum states: "This administration has conducted research on multiple spectrum bands this year to identify which federal spectrum can be reallocated for 6G commercial development without affecting national security missions carried on these bands."

**Commentary**: Reports indicate that the core purpose of the memorandum is clear—to pave the way for 6G commercialization through "spectrum resource reallocation", which is essentially a key move by the U.S. to seize the global standard - setting power in the 6G field. From the perspective of the global competitive landscape, China accounts for over 48% of 6G patents (far exceeding the U.S.'s 35.2%). The Purple Mountain Laboratories have built the world's first 6G integrated communication and intelligent sensing outdoor test network. 6G requires the launch of a large number of satellites, and the China - U.S. 6G race has entered a critical stage of "space infrastructure competition".

4. **Gaming** | Recently, the 2025 China Game Industry Annual Conference was held in Shanghai. The *2025 China Game Industry Report* released at the conference shows that China's game industry has achieved steady growth, with all core data hitting record highs. In 2025, the actual sales revenue of China's domestic game market is expected to reach 350.789 billion yuan, a year - on - year increase of 7.68%; the user scale has increased to 683 million, a year - on - year increase of 1.35%. Institutions predict that the gaming industry is likely to maintain a high - prosperity state. Key new products on the supply side will be launched one after another, cross - platform interoperability between client and mobile terminals will continue to contribute incremental growth, peak - season activities will drive the increase in user duration and ARPU (Average Revenue Per User), the mobile terminal is expected to recover month - on - month, and the client terminal will remain strong.

5. **Solid - State Batteries** | On December 22, Dongfeng Motor Corporation officially announced that its R&D team has successfully developed semi - solid - state battery products through tackling key technologies such as material system innovation, electrolyte membrane composite technology, and electrode solidification. Meanwhile, the company is fully committed to the research and development of all - solid - state battery technology for mass production by 2027. It is understood that Dongfeng Motor's solid - state battery strategy focuses on the mass production of semi - solid - state batteries while accelerating the development of all - solid - state batteries. The core product is a 350Wh/kg semi - solid - state battery, featuring high energy density, high safety, and wide temperature range adaptability, with the goal of supporting vehicles to achieve a driving range of over 1,000 kilometers. Dongfeng Motor stated that the new generation of fully independently developed high - specific energy solid - state batteries maintains an energy retention rate of over 72% in an extremely cold environment of - 30℃, far exceeding the 60% level of ordinary liquid ternary batteries. Moreover, the batteries have successfully passed the 170℃ hot box safety test, far exceeding the national standard requirement of 130℃.

**Commentary**: China Merchants Securities believes that solid - state batteries are currently in a critical stage of transitioning from experimental verification and small - scale trials to pilot - scale delivery. The equipment segment is expected to take the lead in substantive implementation, making it a highly certain segment for new technologies. It is predicted that equipment bidding for pilot production lines may start from the end of 2025 to the beginning of 2026. Subsequent catalysts such as pilot line testing, mid - term review, vehicle loading and debugging, and mass production line bidding will continue to emerge, with broad market prospects in the future. According to China Merchants Securities' estimates, the market space for all - solid - state battery equipment will reach 59.216 billion yuan by 2030, with a compound annual growth rate (CAGR) of 103% from 2024 to 2030.

# Today's Key News Preview

- The U.S. government releases the Q3 GDP report and updates PCE data for July - September.

- U.S. durable goods orders for October.

- U.S. industrial output and manufacturing output for November.

**End of Full Text**

# Risk Warning and Disclaimer

The market is risky, and investment requires caution. This document does not constitute personal investment advice and does not take into account the specific investment objectives, financial situations, or needs of individual users. Users should consider whether any opinions, views, or conclusions in this document are in line with their specific circumstances. Investment decisions made based on this document shall be at the user's own risk.