Morning News

**Source**: Wall Street Insights

### Market Overview

The three major U.S. stock indexes posted their first two-day losing streak of 2026, with the Nasdaq shedding 1% to log its sharpest single-day drop in nearly a month. Tech stocks weighed on the broader market, as all members of the "Magnificent Seven" closed lower; Microsoft, Amazon and Meta each tumbled more than 2%. The semiconductor index halted its three-session winning run, with Broadcom plunging over 4%. Despite reporting better-than-expected Q4 earnings, Bank of America and Citigroup still closed down nearly 4% and over 3%, respectively, while Wells Fargo dropped more than 4% on weaker quarterly profits. Among Chinese concept stocks, Trip.com plummeted 17%.

European and U.S. bond prices rallied in tandem, with the 10-year UK gilt yield hitting a 13-month low and the 10-year U.S. Treasury yield touching a one-week trough. The U.S. dollar index reversed course to trade lower after approaching a four-week high. The Japanese yen, which had hit fresh 18-month lows earlier, rebounded following a warning from Japan's finance minister that no options were off the table to intervene in the forex market. The offshore yuan staged a modest rebound, briefly reclaiming the 6.97 level intraday. Cryptocurrencies extended their upward trend, with Bitcoin surging nearly 4% from its intraday low to break above the $97,000 mark, a new two-month high.

Metals resumed their rally: Gold and silver notched intraday all-time highs for three consecutive sessions, with gold climbing over 1% and silver futures surging nearly 8% intraday. LME tin jumped as much as 11% and LME copper also hit an intraday record high, while LME nickel closed up nearly 6% to an 18-month peak. Crude oil erased intraday gains in a sharp pullback: Comments from Trump appeared to signal de-escalation in U.S.-Iran tensions, prompting crude oil to swing from an intraday gain of around 2% to a loss of over 3%.

During the Asian trading session, margin requirements for securities financing were raised for the first time in a decade. A-share turnover neared RMB 4 trillion for the day, with AI application stocks surging. In Hong Kong, Alibaba rallied more than 5%. Shanghai tin futures soared by the daily limit, and Shanghai silver futures jumped over 8%.

### Top News

China's foreign trade recovery accelerated, with dollar-denominated exports rising 6.6% year-on-year and imports growing 5.7% year-on-year in December. Steel exports hit a record high, and rare earth exports surged 32% year-on-year. Annual imports of soybeans, iron ore and crude oil all set new records, while coal imports registered their steepest decline in a decade.

The Shanghai, Shenzhen and Beijing Stock Exchanges raised the minimum margin requirement for securities financing from 80% to 100%. Late on Wednesday, several popular stocks including Shanghai Weixing New Materials issued announcements stating that they might apply for a trading halt for review. AI and GEO-related concept stocks such as E-Point Worldwide issued a flurry of risk warnings. Regulators rolled out a series of cooling measures, and experts noted that the policy adjustments are aimed at cooling down the market rather than stifling its momentum.

The U.S. Supreme Court once again failed to rule on the case challenging Trump's tariff policy, keeping the Nasdaq down 1%.

U.S. retail sales unexpectedly strengthened in November, rising 0.6% month-on-month, driven significantly by auto sales and holiday spending. Rising energy costs pushed the U.S. November PPI back up to 3% year-on-year, though core PPI came in below expectations month-on-month. U.S. existing home sales in December hit their strongest level since 2023, far exceeding forecasts, while home price growth slowed to its weakest pace in two and a half years.

2026 Federal Open Market Committee (FOMC) voter Neel Kashkari voiced support for Fed Chair Jerome Powell, advocating for keeping interest rates unchanged in January. Fellow 2026 voter Christopher Waller stuck to a cautious stance, while 2025 voter Austan Goolsbee emphasized that independence is crucial in fighting inflation. Fed Governor Adriana Kugler cited a new rationale for rate cuts: deregulation under the Trump administration.

The Fed's Beige Book noted that overall economic activity improved, employment levels were largely unchanged in most districts, and prices rose moderately across most regions.

Trump said he would "wait and see" how the situation in Iran develops, adding that the U.S. government had received a "very positive statement" from Iran, triggering a 3% intraday drop in U.S. crude oil prices.

U.S. media reported that the United States will suspend all visas for 75 countries.

Xinhua News Agency: The White House announced a 25% tariff hike on certain semiconductors and other products.

Alibaba's Qianwen AI officially announced that it will hold an APP launch event on January 15, marking the "era of AI-powered task execution".

2026 ushers in an IPO super cycle: OpenAI and Anthropic are reported to have taken initial steps towards going public, while SpaceX has held talks with multiple banks.

OpenAI splashed out tens of billions of U.S. dollars to partner with Cerebras on deploying 750 megawatts of computing power over three years.

### Market Closing Quotes

**U.S. & European Stock Markets**: S&P 500 fell 0.53% to close at 6,926.60; Dow Jones Industrial Average dipped 0.09% to 49,149.63; Nasdaq Composite dropped 1.00% to 23,471.749. The pan-European STOXX 600 Index rose 0.18% to 6,115.6.

**A-Shares**: Shanghai Composite Index edged down 0.31% to 4,126.09; Shenzhen Component Index gained 0.56% to 14,248.60; ChiNext Index climbed 0.82% to 3,349.14.

**Bond Market**: By the close of the bond trading session, the yield on the 10-year benchmark U.S. Treasury note stood at around 4.13%, down about 5 basis points intraday; the 2-year U.S. Treasury yield was at approximately 3.51%, falling roughly 2 basis points on the day.

**Commodities**: WTI Crude Oil Futures (February contract) closed up 1.42% at $62.02 per barrel; Brent Crude Oil Futures (March contract) rose 1.6% to $66.52 per barrel. COMEX Gold Futures (February contract) finished up about 0.8% at $4,635.7 per ounce. COMEX Silver Futures (March contract) surged 5.85% to $91.385 per ounce. LME Copper closed up nearly 0.2% at $13,188 per tonne; LME Tin jumped over 7.9% to $53,462 per tonne; LME Nickel advanced more than 5.7% to $18,694 per tonne.

# Detailed Top News

## Global Highlights

China's foreign trade recovery accelerated, with dollar-denominated exports surging 6.6% year-on-year and imports climbing 5.7% year-on-year in December. Steel exports hit a record high, rare earth exports soared 32% year-on-year. For the full year, imports of soybeans, iron ore and crude oil all set new records, while coal imports posted their sharpest decline in a decade.

China's dollar-denominated exports jumped 6.6% year-on-year in December; the year-on-year growth rate of imports expanded to 5.7%, up from a mere 1.9% in the previous month. In 2025, China's total goods trade volume exceeded RMB 45 trillion for the first time, with an estimated annual trade surplus of $1.2 trillion. The General Administration of Customs stated that China became a net exporter of industrial robots in 2025, driven by strong demand for AI computing power, and imports of computer components rose 20% last year.

Soybean imports reached 112 million tonnes in 2025, while iron ore and crude oil imports hit all-time highs at 1.26 billion tonnes and 578 million tonnes respectively, marking three consecutive years of growth. In contrast, coal imports plummeted 9.6%, the steepest drop in a decade. Rare earth exports surged 32% year-on-year in December, with full-year exports reaching 62,585 tonnes, the highest level in at least 11 years.

Guolian Minsheng Macro pointed out that export resilience is expected to continue in the short term, while the import recovery process remains relatively slow. Under the dual effects, the high trade surplus will continue to be an important pillar for economic growth in the first quarter. Specifically, tariff disturbances have eased and external demand has improved marginally, gradually alleviating the cyclical pressures that previously constrained exports. In addition, the structural support for export growth is expected to be further consolidated.

The Shanghai, Shenzhen and Beijing Stock Exchanges raised the minimum margin requirement for securities financing from 80% to 100%. In a midday announcement on January 14, the three exchanges stated that with the approval of the China Securities Regulatory Commission (CSRC), the minimum margin ratio for investors to purchase securities on margin would be increased from 80% to 100%, aiming to reduce market leverage through counter-cyclical adjustments. This adjustment only applies to newly opened margin contracts, and existing contracts remain unaffected.

A flurry of announcements were released by popular A-share stocks on Wednesday night. Multiple listed companies, including Shanghai Weixing New Materials, JoinEasy Information, Tianlong Group, E-Ever Bright Group, Gravity Media and BlueFocus Intelligent Communications, issued intensive responses. Several hot stocks such as Shanghai Weixing New Materials announced that they might apply for a trading halt for review, while AI and GEO-related concept stocks like E-Point Worldwide issued frequent risk warnings.

Regulators rolled out a series of market-cooling measures. Experts noted that the policy adjustments aim to cool down the market rather than stifle it. On January 14, the Shanghai, Shenzhen and Beijing Stock Exchanges issued a notice to moderately raise the margin ratio for newly opened margin contracts from 80% to 100%. Tian Lihui, Dean of the Financial Development Research Institute at Nankai University, stated that the adjustment of margin policies combined with the efficient supervision of popular concept stocks indicates that A-share regulators have launched a "combination of measures". The policy regulation is intended to cool the market down rather than put an end to its momentum. Going forward, the market will place greater emphasis on fundamentals and compliance. Short-term fluctuations are inevitable, but the pattern of a "slow bull" and "long bull" market is being gradually consolidated.

Precious metals resumed their rally, with spot silver breaking through the $92 per ounce mark for the first time in history, while copper and tin hit new all-time highs. Spot silver surged past $92 per ounce, climbing nearly 6% intraday; COMEX silver rose 6.0% intraday to close at $91.57 per ounce. Major Wall Street banks are launching a new wave of bullish sentiment on precious metals. Recently, Citigroup sharply raised its short-term precious metal price targets, lifting its 0-3 month silver price forecast from $62 per ounce to $100 per ounce, representing an increase of over 60%.

The U.S. Supreme Court once again failed to rule on the lawsuit challenging Trump's tariff policy, keeping the Nasdaq down 1%. The U.S. Supreme Court did not issue a ruling on the challenge to former U.S. President Donald Trump's tariff policy on Wednesday, meaning the world will have to wait at least until next week to learn the final fate of this landmark economic policy. The Supreme Court has not announced the specific date for its next ruling, but it may schedule more judgments on Tuesday or Wednesday, when the justices will hold another court session.

U.S. retail sales unexpectedly strengthened in November, rising 0.6% month-on-month, driven significantly by auto sales and holiday spending. U.S. retail sales increased 0.6% month-on-month in November, exceeding the market expectation of 0.5%. Among the 13 categories surveyed, 10 registered month-on-month growth. Auto sales rebounded particularly strongly, while categories such as gasoline stations, sporting goods and apparel also performed well, highlighting the strong driving effect of holiday season promotions on consumption. The overall consumption data showed resilience, continuing to support positive market expectations for Q4 GDP growth.

Driven by rising energy costs, the U.S. Producer Price Index (PPI) rebounded to 3% year-on-year in November, while core PPI fell short of expectations month-on-month. The U.S. PPI rose 0.2% month-on-month and 3% year-on-year in November, with a jump in energy prices being the main driver. However, core PPI, which excludes volatile food and energy prices, was flat month-on-month, indicating that underlying inflationary pressures remain moderate.

U.S. existing home sales in December hit their strongest level since 2023, far exceeding expectations, while home price growth slowed to its weakest pace in two and a half years. The annualized number of existing home sales in the U.S. reached 4.35 million units in December, the highest level since February 2023, surpassing the expected 4.22 million units and the previous reading of 4.13 million units. The median price of existing home sales rose only 0.4% year-on-year to $405,400 in December, the slowest growth rate in two and a half years. Nevertheless, inventory increased by only 3.5% year-on-year in December.

2026 FOMC voter voiced strong support for Powell: advocating to keep interest rates unchanged in January and firmly opposing administrative interference in monetary policy. Neel Kashkari, President of the Federal Reserve Bank of Minneapolis, strongly backed Fed Chair Jerome Powell, pointing out that the government investigation is essentially an interference in monetary policy. Regarding the January FOMC meeting, he sent a hawkish signal, advocating for keeping interest rates unchanged. Currently, the Supreme Court is holding a crucial debate on whether the president has the authority to remove Fed officials. Kashkari emphasized that regardless of who the next Fed chair is, policies must be based on data rather than political directives, and the collective decision-making mechanism serves as a line of defense against interference.

2026 FOMC voter stuck to a cautious stance, while 2025 voter emphasized that central bank independence is crucial in fighting inflation. Christopher Waller, a 2026 FOMC voter and President of the Federal Reserve Bank of Philadelphia, expressed cautious optimism about inflation, expecting inflation to approach 2% by the end of the year. He reiterated that if inflation cools and the labor market stabilizes, the Fed may implement further modest interest rate cuts later this year. Austan Goolsbee, a 2025 FOMC voter and President of the Federal Reserve Bank of Chicago, stated that inflation will rebound wherever central bank independence is lacking.

Fed Governor Adriana Kugler found a new rationale for sustained rate cuts: deregulation under the Trump administration. Kugler argued that based on the pace of deregulation launched by the Trump administration in early 2025, 30% of federal regulatory restrictions will be lifted by 2030. This will be "a major positive shock to productivity, which will exert downward pressure on prices", thus "supporting a more accommodative monetary policy stance". Last week, he stated that he expects a total of 150 basis points of rate cuts in 2026.

Fed Beige Book: Overall economic activity improved, employment levels remained largely unchanged in most districts, and prices rose moderately in most regions. The Fed's Beige Book indicated that since mid-November, economic activity in most U.S. districts has rebounded at a "slight to moderate" pace, marking an improvement compared with the previous three consecutive reporting periods, during which most districts reported little change in economic activity. Among the Fed's 12 districts, employment levels remained basically unchanged in 8 districts. Price levels rose at a "moderate" pace in most regions.

Trump said he would "wait and see" how the Iran situation develops, triggering a 3% intraday drop in U.S. crude oil prices. On the afternoon of January 14 local time, U.S. President Donald Trump stated at the White House regarding the Iran situation that "we need to wait and see how the situation develops first". He also pointed out that the U.S. government has received a "very positive statement from Iran". However, he did not rule out the possibility of the U.S. taking military action.

U.S. media: The United States will suspend all visas for 75 countries. According to Xinhua News Agency, Fox News reported on January 14 that the U.S. State Department will suspend visa services for 75 countries "to crack down on applicants who may become public burdens". The report disclosed that the affected countries include Somalia, Russia, Afghanistan, Brazil, Iran, Iraq, Egypt, Nigeria, Thailand, Yemen and others.

Xinhua News Agency: The White House announced a 25% tariff hike on certain semiconductors and other products. According to Xinhua News Agency, the White House announced on January 14 that it would impose a 25% ad valorem tariff on some imported semiconductors, semiconductor manufacturing equipment and derivatives starting from January 15.

The "Sell America" trade is making a comeback, with smart money quietly flowing north into Canada. The "Sell America" trading trend has emerged as the erosion of Fed independence has pushed up risk premiums, prompting capital to accelerate its flight to safe havens. Canada's stock market has posted its best performance relative to U.S. stocks in 20 years, with its benchmark index surging 28% last year. Institutions pointed out that the Canadian dollar's valuation advantage and lower political volatility have made it the top alternative to U.S. stocks, which are facing dual pressures from a weaker U.S. dollar and rising yields.

Two extremes: U.S. electricity prices are set to surge, while China's electricity prices are falling. U.S. electricity prices have hit a peak, with recent grid capacity auctions for PJM, the largest power grid in the U.S., reaching the price ceiling of $333.4. Without regulation, the actual cost could be 60% higher. Goldman Sachs warned that electricity bills are at risk of doubling. Trump has strongly pressured tech giants such as Microsoft to fully bear infrastructure costs to stabilize household electricity prices. In contrast, Bank of America believes that driven by the rapid growth of wind and solar installed capacity and weak demand for thermal power, the proxy power purchase price in January fell 10% year-on-year, and long-term contract electricity prices have declined across the board this year.

Goldman Sachs: Aging U.S. power grid is providing historic opportunities for China's power industry chain. The core contradiction in AI infrastructure construction is shifting from GPUs to power supply, with delivery speed becoming the key to success. A Goldman Sachs research report pointed out that the aging and capacity shortage of U.S. and European power grids have led to a nearly five-year waiting period for grid connection. Leveraging advantages such as short delivery cycles, HVDC technology and 800V DC architecture, Chinese power suppliers are reshaping pricing power in the global supply chain. Goldman Sachs provided a clear preference ranking for Chinese power supply-related product categories: gas turbine blades > power transformers > electrical components > uninterruptible power supplies (UPS)/power racks > liquid cooling systems > server power supplies.

Alibaba's Qianwen AI officially announced: APP launch event to be held on January 15, marking the era of AI-powered task execution. Alibaba's Qianwen AI will hold its "Ask and You Shall Receive" product launch event at 10:00 a.m. on January 15, marking the official transformation of AI large models from a single "Q&A tool" to a new era of "action execution". Backed by Alibaba Cloud's dominant 35.8% share of China's AI cloud market, this strategic upgrade not only heralds the arrival of the intelligent agent era, but also represents a key move for Alibaba Cloud to seize 80% of the incremental AI cloud market in 2026.

U.S. law enforcement authorities take action against Grok over "pornographic content": Musk's xAI is under investigation in California. The California investigation focuses on the AI model Grok developed by xAI, which is accused of "mass-producing" deepfake intimate images without consent, which are used to harass women and girls online. Prior to this, governments in multiple countries including the EU, the UK, France, India and Brazil have taken action or issued warnings against Grok. On Wednesday, Elon Musk stated that he was unaware of the generation of any "explicit images of minors".

2026 ushers in an IPO super cycle! OpenAI and Anthropic are reported to have taken initial steps, while SpaceX has held talks with multiple banks. Media reported that OpenAI is in discussions with several top law firms including Cooley regarding IPO preparations; Anthropic hired law firm Wilson Sonsini last month to assist with listing preparations; SpaceX has interviewed and is preparing to finalize the lead banks for its IPO, and its executives told investors that the company will go public within the next 12 months if there are no major market shocks. All three companies currently have record-high valuations: Anthropic's valuation has reached $350 billion in its ongoing financing negotiations, OpenAI's valuation hit $500 billion in October last year, and SpaceX's latest valuation stands at $800 billion.

OpenAI splashed out tens of billions of U.S. dollars to partner with Cerebras on deploying 750 megawatts of computing power over three years. OpenAI and Cerebras announced the signing of a three-year agreement, committing to purchase up to 750 megawatts of computing power, all using Cerebras' wafer-scale chips. According to the agreement, the deployment will be carried out in phases starting from 2026. Citing people familiar with the matter, the Wall Street Journal reported that the total transaction value exceeds $10 billion.

## Selected Research Reports

From "TACO" to "Big MAC": How Wall Street seeks safe havens amid policy "chaos" and on the eve of midterm elections. Wall Street is shifting to the "Big MAC" (Midterm Election Campaign) trading theme to cope with policy volatility triggered by the 2026 midterm elections. Trump's intensive "Twitter governance" has severely hit the banking and military sectors, and undermined the independence of the Federal Reserve. Historical data shows that the stock market experiences an average correction of 18% in midterm election years, and individual stock volatility has soared to more than twice that of the index. Faced with high valuations and the risk of administrative intervention, institutions such as JPMorgan Chase have warned that U.S. stocks may underperform in the near term.

AI data center power supply chain: Goldman Sachs favors "gas turbine blades and transformers" the most, presenting great opportunities for such Chinese enterprises. Goldman Sachs believes that supply shortage-driven pricing premiums have allowed Chinese suppliers to sell their products overseas at prices 10% to 80% higher than domestic prices. Even after accounting for increased tariffs and logistics costs, profit margins have improved significantly. In terms of product category preferences, Goldman Sachs' ranking is as follows: gas turbine blades > power transformers > electrical components > UPS/power racks > liquid cooling systems > server power supplies (PSU).

How long can the copper bull market last? Goldman Sachs: The high price of $13,000 is unsustainable, and the turning point may come after tariffs take effect in the second quarter. Goldman Sachs warned that copper prices have recently surged above $13,000 per tonne, which is severely divorced from fundamentals, mainly driven by inventory hoarding triggered by U.S. tariff expectations and speculative capital. Although it has raised its H1 2026 price forecast to $12,750 per tonne in the short term, it expects that as tariffs take effect in the second quarter, the market will return to the reality of a severe global supply surplus, putting copper prices at significant downside risk.

Imbalanced supply and demand pattern: Is aluminum replacing copper an inevitable industrial trend? Against the backdrop of the record-high copper-aluminum price ratio and the long-term inelasticity of copper supply, "aluminum substituting copper" is accelerating from a technical alternative to an industrial reality. With systemic breakthroughs in materials, processes and structures, the large-scale application of aluminum in fields such as power, air conditioning and automobiles (especially new energy vehicle wiring harnesses and connectors) is on the verge of realization. This cross-cyclical industrial trend not only eases the tension in copper resources, but also brings new growth logic and valuation revaluation opportunities for the aluminum industry.

# Domestic Macroeconomy

The home-buying tax refund policy has been extended, with personal income tax incentives for "selling old homes to buy new ones" continuing to be supported for the 2026–2027 period. According to the Ministry of Finance, from January 1, 2026, to December 31, 2027, taxpayers who sell their own residential properties and repurchase a new home in the market within one year after the sale will be eligible for a refund of the personal income tax paid on the sale of the original property. Specifically:

- If the price of the newly purchased home is greater than or equal to the transfer price of the original home, the full amount of personal income tax paid on the original home sale will be refunded.

- If the price of the newly purchased home is less than the transfer price of the original home, the refund amount will be proportional to the ratio of the new home price to the original home transfer price.

Three government departments: Resolutely resist disorderly "price wars" in the new energy vehicle industry, and promote the establishment of a market order featuring fair competition and quality-based pricing. A joint meeting emphasized the need to fully implement the decisions and arrangements of the Party Central Committee and the State Council, adhere to innovation-driven development and quality-first principles, firmly resist disorderly price wars, and foster a market environment of fair competition where prices match quality. The three departments will further strengthen coordination, enhance cost surveys and price monitoring, intensify regulatory and law enforcement efforts, strengthen supervision and inspection of product manufacturing consistency, severely penalize non-compliant enterprises in accordance with laws and regulations, safeguard a fair and orderly market environment, and promote the high-quality development of the automobile industry.

Global Times Editorial: The U.S. "greenlighting" of H200 shipments reflects China's drive for self-reliance in science and technology. The U.S. previous chip "supply cutoff" measures targeting China did not stifle China's high-tech development; instead, they stimulated intensive technological breakthroughs leveraging the advantages of China's new nationwide system. From the iteration of Huawei Ascend chips, to the application breakthroughs of domestic GPUs in specific scenarios, and the strengthening of the entire industrial chain, China has demonstrated strong R&D potential and a clear path of technological iteration. The relaxation of export policies for the H200 is a practical admission by the U.S. that "blockades" and "embargoes" are no longer sufficient to halt China's technological takeoff.

Shanghai launches the "Model-Driven Smart Mobility" Initiative, aiming for mass production of L4 autonomous vehicles and the orderly expansion of open test areas. According to The Paper, by 2027, the initiative seeks to achieve large-scale deployment of high-level autonomous driving application scenarios, establish public service platforms to strongly support industry innovation, bring key technologies and industrial scale to international leading levels, form an internationally competitive and influential intelligent connected vehicle industrial cluster, and basically build a world-leading high-level autonomous driving pilot zone.

Following the "Zhong Cai Wen" column, People's Daily launches a new column with a fresh article: In the new year, fully "strive for economic growth"! The column article states that efforts should be made to seize the time window, take proactive actions, and maintain the momentum of policy support. The "Two New Initiatives" (new infrastructure, new-type urbanization) are leading the way, with the first batch of 62.5 billion yuan in national subsidy funds already allocated. The "Two Major Projects" (major strategic projects, major livelihood projects) continue to drive development, as the National Development and Reform Commission has issued the 2026 advance batch list of "Two Major Projects" and the central budgetary investment plan. The National Venture Capital Guidance Fund has been launched, the "Shop in China" campaign and Spring Festival consumption season have kicked off, and 114 new drugs have been included in the national medical insurance drug list... With stronger efforts to boost consumption, stabilize investment, and improve people's livelihood, we will strive to achieve a good start in the first quarter, laying a solid foundation for "continuing to consolidate and expand the sound momentum of steady economic recovery".

Internal Report from China Life, the "leader of life insurance": Continue to increase allocation of Chinese equity assets! As an important long-term capital manager in the capital market, the insurance asset management industry needs to continuously improve the institutional mechanisms and capacity systems that support long-term investment and value investment.

How much incremental capital will flow into A-shares this year? Huatai Securities: Net inflow may reach 1.6 trillion yuan, with household deposits and retail investor funds accounting for 40%. Huatai Securities estimates that the A-share market is expected to see a net inflow of approximately 1.6 trillion yuan in incremental capital in 2026, calculated by subtracting the estimated capital demand of 1 trillion yuan from the total expected capital inflow of 2.6 trillion yuan. The surge in capital supply is mainly driven by the accelerated shift of household savings to the market and the policy-driven entry of long-term capital. The inflow of household deposits is expected to bring about 650 billion yuan of incremental capital to A-shares. Retail investor funds are projected to contribute a net inflow of around 400 billion yuan in 2026. Margin financing and private equity funds are expected to add 500 billion yuan, insurance capital is likely to inject a massive 800 billion yuan, and foreign capital is forecast to record a net inflow of approximately 100 billion yuan for the full year.

# Domestic Companies

A-share market recovery boosts performance: CITIC Securities' 2025 net profit surges 38% year-on-year to exceed 30 billion yuan.

Report: Baidu plans to apply for dual primary listing in Hong Kong, opening access to mainland investors. Baidu is considering upgrading its secondary listing in Hong Kong to a "dual primary listing". This move aims to qualify for inclusion in the Stock Connect program, thereby further attracting mainland capital. If the restructuring is completed, although the company will face higher compliance costs, it will not only gain access to mainland capital support but also enhance the resilience of its listing structure against risks amid complex geopolitical environments.

An undervalued "shovel seller" in the data center industry? Report: Montage Technology's Hong Kong IPO secures cornerstone investments from top institutions including Alibaba and J.P. Morgan Asset Management. Reports indicate that Montage Technology plans to raise US$900 million through its Hong Kong IPO, with heavyweight cornerstone investors such as Alibaba, J.P. Morgan, and UBS already locked in. Driven by strong demand for AI infrastructure, the company's valuation has reached US$22 billion, and its 2026 profit is expected to surge to 3.3 billion yuan. This move marks a strong recovery in Hong Kong's new stock market, with January fundraising exceeding US$4 billion.

# Overseas Macroeconomy

Has Trump shifted his focus for the election? Wall Street has fallen from a former "darling" to a policy "scapegoat". Trump has successively introduced a series of restrictive measures targeting the financial industry, including blocking large investors from purchasing residential properties, calling for caps on credit card interest rates, and announcing restrictions on executive compensation and stock buybacks. With the midterm elections now taking precedence over bank profitability and market stability, Trump has shifted to prioritizing the interests of ordinary consumers.

On the eve of the Federal Reserve receiving a subpoena, Trump "lashed out" at Justice Department prosecutors for being "weak and incompetent" and "daring not to prosecute the intended targets". At a White House event last Thursday, Trump publicly criticized federal prosecutors as "weak and incompetent" for their reluctance to prosecute the targets he designated, stating that he felt "betrayed". Just one day after the White House event, prosecutors issued a subpoena to the Federal Reserve to investigate Chairman Powell's testimony regarding building renovations. This move highlights the tense relationship between Trump and the judicial system, raising concerns about political interference in judicial independence.

Compared to Powell being subpoenaed, next week's court hearing is "more important" for Fed independence and "significant" for the market. The U.S. Supreme Court hearing on Trump's dismissal of Fed Governor Lisa Cook next Tuesday will be a crucial turning point in the battle to defend Federal Reserve independence. Analysts warn that if the White House wins the case, it will open a legal loophole for Trump to remove Chairman Powell. If the Fed's independence is undermined, it could trigger severe asset repricing and market volatility. "This month could mark the beginning of the next bear market, or even a market crash."

JPMorgan Chase's Jamie Dimon warns: Trump administration's attacks on the Fed will trigger inflation. JPMorgan Chase CEO Jamie Dimon warned that the Trump administration's attacks on Federal Reserve independence would backfire, leading to rising inflation expectations and higher interest rates. As central bank governors around the world voice their support for Powell, Dimon emphasized that political interference would undermine economic stability. The executive also warned that Trump's proposed cap on credit card interest rates would restrict credit supply.

How to interpret "Trump-style QE"? Investors: The era of liquidity prosperity has arrived, and "all pretense of fiscal/monetary tightening has vanished". From Trump's order to purchase US$200 billion in mortgage-backed securities, to the Fed's resumption of balance sheet expansion, and the relaxation of bank capital requirements, a series of policy combinations are creating a liquidity bonanza, and the flood of liquidity will push up valuation risks. Although officials deny that MBS purchases and the Fed's short-term bond purchases constitute QE, in practice, this is simply exchanging one type of liquid asset for another.

Abnormal details behind the weak U.S. December CPI data. Citigroup stated that U.S. core CPI rose by only 0.24% month-on-month in December, indicating the initial signs of a slowdown in inflation. Affected by the government shutdown, severe carry-over estimation errors occurred in data collection, leading to extremely volatile "mechanical rebounds" and abnormal underperformance in service sub-items such as entertainment and communications, making the overall details difficult to interpret. Citigroup predicts that the Fed will therefore start cutting interest rates in March.

Yen hits an 18-month low! Japan's Finance Minister warns: "No options are off the table" to rescue the market. News of Japan's planned early general election has intensified downward pressure on the yen, with USD/JPY once falling to 159.45, the lowest level since July 2024. Japan's Finance Minister Shunichi Suzuki once again warned that "no options are off the table" to intervene in the foreign exchange market, sending a clear policy signal. Historical data shows that the 160 level is a key intervention threshold for Japanese authorities, who stepped in to support the yen four times near this level last year. On the same day, Bank of Japan Governor Kazuo Ueda reiterated that the central bank will continue to raise interest rates.

"High-market trading" ignites the market; Ueda maintains his stance: As long as inflation targets are met, interest rate hikes will continue. Kazuo Ueda stated that wages and inflation are likely to continue rising gradually, noting that moderate adjustments to monetary easing will help achieve price targets smoothly and drive long-term economic growth. While most observers expect the Bank of Japan to raise interest rates approximately every six months, some analysts believe that the yen's weakness may prompt the central bank to act earlier.

Upon hearing the death penalty verdict, Yoon Suk-yeol turned red, grabbed the microphone and delivered an 89-minute statement in a hoarse voice, slamming the table in court and shouting: "How could a fool like me stage a coup?" Yoon Suk-yeol pleaded not guilty and defended his decision to impose a state of emergency, claiming it was a necessary measure to monitor and curb malicious acts endangering the country. "I announced the martial law to the world on broadcast, and when the National Assembly suspended it two or three hours later, I complied. Have you ever seen such a civil unrest?" "How could a fool like me stage a coup? That requires sharp political acumen." At the end of his statement, Yoon Suk-yeol said, "All of this is due to my lack of virtue" and asked rhetorically, "Was I too naive?"

# Overseas Companies

At the "Annual Pharmaceutical Summit", NVIDIA elaborates on "how AI will transform healthcare". JPMorgan Chase stated that NVIDIA is conducting a "full-stack" layout in AI healthcare, building a closed-loop ecosystem from chips to tools to domain-specific models—the so-called "dry lab-wet lab" flywheel. Meanwhile, AI is evolving from "pilot projects" to "commercial deployment", with the U.S. healthcare industry adopting commercial AI three times faster than the overall economy. On the physical lab front, NVIDIA is collaborating with Thermo Fisher Scientific, accelerating the industrialization process of drug discovery.

Report: SK hynix to halt production of consumer-grade memory chips, shifting resources to B2B and AI server markets. Following Micron Technology, South Korean chipmaker SK hynix is reportedly planning to stop production of some consumer-grade DRAM and NAND Flash products, redirecting core resources to the B2B and AI server markets.

From selling cars to selling services: Tesla's FSD fully switches to a subscription model, with a $99 monthly subscription becoming the only option. Tesla announced that it will stop selling the FSD system after February 14, fully transitioning to a monthly subscription model. This move eliminates the high upfront cost barrier of $8,000, instead attracting users with a low monthly fee of $99. Against the backdrop of sluggish sales, Tesla is accelerating its shift to a technology-driven revenue model centered on FSD and robotics.

The code for Anthropic's latest AI agent Cowork was entirely written by Claude. Anthropic's newly launched AI agent tool Cowork was independently developed by Claude Code in just 10 days. The tool allows ordinary users to directly handle daily tasks such as file management and document generation through natural language commands, achieving a significant leap in efficiency.

# Industries/Concepts

1.  **Semiconductors** | According to Xinhua News Agency, a research team led by Huang Xian and Guo Rui from the State Key Laboratory of Precision Measuring Technology and Instruments at Tianjin University, in collaboration with Wang Hongzhang's team from Tsinghua Shenzhen International Graduate School, has proposed a "thermal shrinkage fabrication strategy" based on liquid metal circuits and thermoplastic films, marking a major breakthrough in flexible electronics and intelligent sensing. Using this technology, the research team has successfully developed custom-fit tactile sensor arrays for robot arms and heads, equipping robots with sensitive "electronic skin".

2.  **AI Flash Sales** | On January 14, Alibaba's video account announced that the Qianwen App launch event will be held at 10:00 on January 15, showcasing how AI will "usher in the era of task execution". Earlier, Alibaba's core management stated that the Qianwen project is regarded as the "battle for the future in the AI era". Alibaba plans to integrate various life scenarios such as maps, food delivery, shopping, and healthcare into Qianwen, endowing it with powerful task-execution capabilities. On December 18, 2025, Alibaba Qianwen App integrated its first Alibaba ecosystem scenario—Amap, gaining the ability to understand and act in the physical world. Through system-level integration, Qianwen App no longer only generates text-based suggestions, but can also call underlying services such as Amap and local business directories to instantly generate visual decision-making tools that include recommended restaurants, shopping destinations, geographic locations, and travel routes.

   Research institutions believe that relying on Alibaba Cloud and the Tongyi large model, Alibaba Taobao Flash Sales has fully productized and toolized AI capabilities. By accessing the Alibaba Qianwen App via mobile phones, users can leverage Taobao Flash Sales to call map services, rely on physical stores, flash sale warehouses, and AI supercomputing capabilities. Taobao Flash Sales ensures that "the right products" appear at "the right time" and "the right place", matching millions of riders, millions of stores, and tens of thousands of products through intelligent AI technology, enabling faster and more accurate fulfillment.

3.  **Energy Storage** | According to The Paper, the world's first ultra-high temperature heat pump energy storage technology—"Chunuo"—has recently been launched. Developed independently by the Central Research Institute of State Power Investment Corporation, "Chunuo" ultra-high temperature heat pump energy storage is an innovative long-duration energy storage technology route, which can be widely applied in various scenarios such as wind and solar absorption in large new energy bases, flexibility improvement of supporting power sources, and low-carbon operation of high-energy-consuming industrial parks.

4.  **Intelligent Driving** | On January 14, the Shanghai Municipal Commission of Economy and Informatization, the Shanghai Municipal Transportation Commission, and the Shanghai Public Security Bureau jointly issued the *Shanghai High-Level Autonomous Driving Pilot Zone "Model-Driven Smart Mobility" Action Plan*. The plan outlines the overall strategy of "model-driven leadership, application demonstration driving, industrial collaborative development, and policy support", aiming to accelerate the transformation of autonomous driving technological innovation into industrial competitiveness. By 2027, the plan seeks to achieve large-scale deployment of high-level autonomous driving application scenarios, establish public service platforms to strongly support industry innovation, bring key technologies and industrial scale to international leading levels, form an internationally competitive and influential intelligent connected vehicle industrial cluster, and basically build a world-leading high-level autonomous driving pilot zone.

5.  **AI Glasses** | According to Sina Finance, with the steady growth in sales of Ray-Ban Meta smart glasses, Meta, the parent company of Facebook, is discussing raising annual production capacity to 20 million units or more by the end of 2026. People familiar with the matter said that EssilorLuxottica, the world's largest eyewear manufacturer responsible for production, is close to its original target of achieving an annual output of 10 million units by the end of 2026.

# Today's News Preview

- The State Council Information Office will hold a press conference to introduce the effectiveness of monetary and financial policies in supporting the high-quality development of the real economy.

- TSMC earnings conference.

- Alibaba Qianwen App launch event: Witness how AI "usher in the era of task execution".

- Bank of Korea announces interest rate decision.

- UK November GDP data release.

- France December CPI data release.

- U.S. December retail sales data release.

- U.S. November long-term capital net inflow data release.

- U.S. weekly initial jobless claims data release.

- U.S. November import and export price index data release.

- Speeches by Fed Governor Michael Barr, Atlanta Fed President Raphael Bostic, Richmond Fed President Thomas Barkin, and Kansas City Fed President Jeffrey Schmid.

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