Morning News

# Source: Wall Street CN

## Market Overview

Energy infrastructure in the Middle East was targeted by attacks. U.S. February PPI data came in far above expectations, and Fed Chair Powell struck a hawkish tone. Traders now price in only a 50% chance of interest rate cuts this year. U.S. stocks, Treasuries, gold, and cryptocurrencies plunged, while oil, gas, and the U.S. dollar surged.

All three major U.S. stock indices closed lower. The S&P 500 fell 1.4%, hitting its lowest level since November; the Nasdaq dropped 1.4%; and the Dow Jones lost 1.6%. Energy was the only sector to finish higher. Micron Technology slumped nearly 6% following its earnings report.

U.S. Treasury yields across maturities rose sharply. The 2-year yield climbed 10 basis points to 3.775%, and the 10-year yield rose nearly 6.5 basis points.

The U.S. Dollar Index gained 0.76%, reclaiming the 100 level. The Japanese yen fell nearly 0.6%, approaching the 160 mark.

Cryptocurrencies were sold off. Bitcoin plunged 4.6%, falling back to around $71,000, while Ethereum dropped 6%.

Spot gold fell 3.6%, approaching the $4,800 support level and hitting a one-month low. Spot silver declined 4.9%.

WTI crude oil rose 4.2%. Brent crude surged 7%, nearing $110 per barrel. Natural gas jumped more than 5%.

During Asian trading hours, A-share and H-share markets rallied in the afternoon. The ChiNext Index surged over 2%, and the entire AI computing power industry chain exploded. Alibaba rose more than 2%, and AI large model stock Zhipu AI jumped 20%.

## Key News

### China

Trump stated his visit to China may be delayed by five to six weeks. The Chinese Foreign Ministry responded: Head-of-state diplomacy plays an irreplaceable leading role in China-U.S. relations. China and the U.S. will continue to communicate regarding President Trump's visit to China.

Tencent's Q4 revenue rose 13% year-on-year, with adjusted net profit up 17%. Its cloud business achieved large-scale profitability for the full year. During the earnings call, Pony Ma first discussed his "shrimp farming" vision, announcing AI investment will at least double this year, and AI agents will spawn a new decentralized ecosystem.

DeepSeek appears to have made another move, with a mysterious AI model sparking heated discussions among global developers.

### Overseas

The Federal Reserve held rates steady as expected, noting uncertainty from the Middle East impact, raising inflation forecasts, and still projecting one rate cut this year. Powell stated: No rate cuts until inflation improves; he will not leave the Fed during the investigation and will serve as interim chair if necessary. The "New Fed News Agency" reported: With the threat of an Iran war, the Fed's fight against inflation may be forced to prolong.

Inflation data across the board beat expectations. U.S. February PPI rose 3.4% year-on-year, and core PPI hit 3.9%, a one-year high.

U.S. diesel prices topped $5 per gallon, with the energy shock starting to transmit to the real economy.

Iran launched large-scale missile attacks on U.S.-related energy facilities, targeting three Middle Eastern countries. Trump reportedly does not want to strike such facilities again for now. Part of Iran's largest gas field was suspended after an attack, the first such incident since the conflict began. The U.S. military plans to mass-produce copies of Iranian suicide drones. Trump said he is not ready to end the conflict and is not worried about Iran becoming "another Vietnam." After the killing of the "de facto supreme leader," Iran vowed to launch the "strongest" strikes against the U.S. and Israel. The U.S. and Israel now diverge on "endgame goals." A small number of vessels "can only pass by sailing along Iran's coastline"! Middle East oil exports plummeted 61%-71%.

AI is driving a boom in the memory chip sector. Micron's revenue nearly doubled last quarter, with this quarter's guidance far exceeding expectations. Fiscal-year spending is set to surge, and its stock fell as much as 6% in after-hours trading.

## Market Close

### U.S. & European Equities

- S&P 500: -1.36% to 6,624.70

- Dow Jones Industrial Average: -1.63% to 46,225.15

- Nasdaq Composite: -1.46% to 22,152.421

- European STOXX 600: -0.70% to 598.25

### A-Shares

- Shanghai Composite: +0.32% to 4,062.98

- Shenzhen Component: +1.05% to 14,187.80

- ChiNext Index: +2.02% to 3,346.37

### Bond Market

- U.S. 10-year Treasury yield: +6.65 bps to 4.2650%

- U.S. 2-year Treasury yield: +9.93 bps to 3.7729%

### Commodities

- WTI crude oil futures: Rose to the psychological $100/barrel level in electronic trading, gaining over 4% after the New York close

- Brent crude oil futures: Broke above $110/barrel in electronic trading

- COMEX gold futures: -3.72% to $4,821.90/oz

- COMEX silver futures: -5.53% to $75.515/oz

# News Details

## Global Highlights

### China

Trump says China visit may be delayed by five to six weeks; Foreign Ministry responds. According to Huanqiu.com, Foreign Ministry Spokesperson Lin Jian responded at a regular press conference on March 18 to U.S. President Trump’s statement that his visit to China would be postponed and may take place in five to six weeks. Lin Jian stated that head-of-state diplomacy plays an irreplaceable leading role in China-U.S. relations. China and the United States will continue to communicate regarding President Trump’s visit to China.

Tencent’s Q4 revenue rose 13% YoY, adjusted net profit up 17%; cloud business achieves full-year large-scale profitability; earnings call: Pony Ma first discusses “shrimp farming” vision, AI investment to at least double this year, AI agents to spawn new decentralized ecosystem.

Tencent delivered steady growth in 2025, with full-year revenue reaching RMB 751.8 billion, up 14% YoY; non-IFRS attributable net profit hit RMB 259.6 billion, rising 17% and accelerating from the previous year. Profitability continued to improve, with gross margin climbing from 53% to 56%. AI has become the core growth driver, with annual R&D investment hitting a record RMB 85.7 billion and capital expenditure reaching RMB 79.2 billion, both all-time highs. AI technology has fully penetrated core businesses including advertising, gaming, and cloud services, accelerating monetization of the WeChat ecosystem and helping the cloud business achieve large-scale profitability.

Tencent has identified AI as its core strategy, planning to at least double investment in Hunyuan and new AI products in 2026, with revenue growth likely outpacing profit in the short term. The company emphasized the resilience of core businesses (gaming, social media, advertising) in the AI era, and drawing on cloud business experience, adopts a long-term mindset toward AI investment returns. Tencent is optimistic about decentralized opportunities brought by AI agents, planning to deeply integrate Hunyuan into ecosystems such as WeChat rather than engaging in monopolistic competition at the foundational model layer.

Tencent hits the jackpot with the “Lobster Trio.” With its sharp AI positioning, Tencent has quietly invested in the “Lobster Trio” — Xunce, MiniMax, and Zhipu — becoming the biggest winner in the current OpenClaw craze. As a major shareholder in all three companies, Tencent holds a cumulative book value of over HKD 10 billion. As the OpenClaw concept ignited Hong Kong stocks, Tencent’s market cap briefly returned to HKD 5 trillion, and it quickly launched a full lineup of products including QClaw, seizing the lead in the AI agent race.

DeepSeek appears to strike again; mysterious AI model sparks global developer buzz. A mysterious AI model named Hunter Alpha recently launched on developer platforms, boasting 1 trillion parameters, a 1 million-token context window, and free access, processing over 160 billion tokens within days. Given its highly consistent training data cutoff and inference style with DeepSeek, the market speculates it is a secret beta version of DeepSeek V4.

### Overseas

Fed holds rates steady as expected, notes uncertainty from Middle East impact, raises inflation forecasts, still projects one rate cut this year; Powell: No cuts until inflation improves; will not leave Fed during investigation, to serve as interim chair if necessary.

One dissenter, Governor Milan, continued to advocate for a 25-bp rate cut. The statement added language on uncertainty regarding the Middle East situation’s impact on the U.S. economy, and revised its description of the unemployment rate to “little changed.” In the dot plot, seven officials forecast no rate cuts this year, 12 expect at least one cut; one official projects a rate hike next year. The Fed raised GDP forecasts for this year, next year, the following year, and the longer term, with inflation projections for this year and next revised up to 2.7% and 2.2%, respectively.

At the press conference, Powell stated that the Fed would not cut rates until it sees further improvement in inflation, and that discussions of “potential further hikes” have been mentioned. He noted that the economic impact of an Iran war remains uncertain, progress in inflation cooling has stalled, and rising tariffs and oil prices are creating overlapping pressures that are gradually feeding through to core inflation, with goods disinflation unlikely until mid-year. He also said macro data so far shows no contribution from AI, which may instead push up the neutral rate in the short term. Additionally, he confirmed he will not leave the Fed during the investigation and will continue to serve as interim chair after his term expires if his successor is not confirmed by the Senate.

“New Fed News Agency”: Threat of Iran war could force Fed to prolong inflation fight.

Inflation beats expectations across the board! U.S. February PPI rises 3.4% YoY, core PPI hits 3.9%, a one-year high. Fed’s rate-cut room for the year continues to shrink.

U.S. diesel tops $5 per gallon; energy shock begins to transmit to real economy. On the supply side, U.S. domestic shale oil is primarily light crude, and Saudi Arabia’s East-West Pipeline — the core alternative to the Strait of Hormuz — also mainly transports light crude, leaving heavy crude used for diesel production facing severe shortages. On the demand side, U.S. diesel consumption is driven almost entirely by commercial uses such as trucking, with demand still growing. Cost pressures will directly penetrate all links in the supply chain, passing through to end consumers in the form of price hikes.

Iran launches large-scale missile attacks on U.S.-linked energy facilities, targeting three Middle Eastern countries; Trump reportedly does not want to strike such facilities again for now. After a major gas field was attacked, Iran said it would mass-produce Iranian-style suicide drones targeting U.S.-related oil facilities and U.S. military bases, while Trump stated he is “not ready to end the conflict.” Separately, reports say Israel assassinated Iran’s intelligence minister; the situation is being verified. Iran vowed to launch its “strongest-ever” strikes against the U.S. and Israel. Analysts believe Ali Larijani actually held supreme decision-making power and led the counterattack against the U.S. and Israel and the strategy to block the Strait of Hormuz.

Details emerge on Larijani’s “beheading.” In the early hours of March 17 local time, Ali Larijani, the real power holder after Khamenei and Secretary of the Supreme National Security Council, was killed in an attack. Larijani was killed in an airstrike by U.S. and Israeli warplanes at his daughter’s home in Pardis, a suburb of Tehran, along with his son Morteza and several guards.

Only a few vessels “can pass by sailing along Iran’s coastline!” The Strait of Hormuz can only reopen if Iran halts hostilities. Data shows tanker traffic through the strait plummeted from around 100 vessels per day pre-conflict to about 2, with around 400 still stranded; only a handful can transit by hugging Iran’s coastline. JPMorgan analysis notes the strait has not been formally closed, but passage has become “Iran-approved.” Allies have reacted coolly to Trump’s escort initiative; oil prices have risen about 40% since Feb. 28 to above $100, with markets betting a ceasefire is the only relief.

Final showdown? Battle for the Strait of Hormuz emerges. U.S. Central Command said on social media on the 17th that U.S. forces struck Iranian missile sites along the Strait of Hormuz that day with multiple 5,000-pound bunker-buster bombs. The sites housed Iranian anti-ship cruise missiles that “threaten international shipping in the strait,” the statement said. Trump’s call for allies to join escort missions was rejected; multiple European nations stated “this is not Europe’s war.”

AI drives memory chip boom; Micron’s revenue nearly doubles last quarter, current-quarter guidance beats estimates sharply, fiscal-year spending set to surge. Micron reported fiscal Q2 gross margin approaching 75%, with revenue and EPS hitting quarterly records; quarterly dividend raised 30%. Fiscal Q3 revenue guidance midpoint is over 50% above analyst estimates, EPS guidance nearly 70% above expectations, with gross margin seen at 81%; fiscal-year capex guidance raised 25% to $25 billion, with next-year spending projected to increase by over $10 billion from this year. Shares rose over 2% in after-hours trading before falling as much as 6%.

## Selected Research Reports

Ghost of 1979’s “Saturday Night Massacre”: Fed’s rate-cut hesitation stems from avoiding Volcker’s path! Lessons from the 1970s are clear: inflation spiraled out of control amid two energy crises, and the Fed failed to act decisively in time, forcing Volcker to crush inflation with aggressive rate hikes, triggering heavy losses in global stock and bond markets.

“Fake oil prices” linger at $100; “real oil prices” hit $155. JPMorgan warns this $55 gap stems from regional inventory gluts, benchmark pricing structures, and policy interventions — all essentially short-term buffers that do not reflect true global supply tightness. If the Strait of Hormuz remains blocked, Brent and WTI will eventually reprice upward, converging with Middle East spot prices.

A prolonged Iran war would mean far more than just soaring oil prices. Bank of America’s latest report breaks down the Iran war into four scenarios: Brent crude’s 2026 average price rises stepwise from $70 to $130, with the extreme scenario peaking at $240. The impact extends far beyond oil and gas — irreversible aluminum smelter shutdowns, sulfur supply shortages threatening African copper mines, urea surging 30% driving global food prices, and European natural gas inventories approaching 2022’s dangerous lows. BofA bluntly states the market is “underpricing” at least three areas: long-dated contracts, cross-commodity spreads, and volatility structures.

UBS bullish on gold: Dollar pressure is temporary; remains “king of safe havens,” set to hit new highs this year! Behind gold’s “failure” may lie entry signals for the next rally. UBS strategists note recent gold weakness is not a breakdown in safe-haven logic but short-term pressure from high real rates and a strong dollar — the bull market’s core driver, “ongoing global portfolio reallocation,” remains intact. Once slowing growth forces policy shifts, falling real rates will reopen upside, making the current consolidation phase a buying window.

“Growing pessimism!” Goldman Sachs: “Next shoe” in credit markets is dropping. Goldman Sachs’ credit strategy team issued a rare pessimistic warning, stating current capital market pressures are far from fully released. Amid overlapping pressures from sustained energy price shocks, high financing costs, and tight credit spreads, AT1 bonds, investment-grade corporate hybrid debt, and BB-rated high-yield bonds are the next assets likely to face sell-offs.

# Domestic Macro

## Opinions on Piloting the 30-Year Extension of Second-Round Rural Land Contracts

The General Office of the CPC Central Committee and the General Office of the State Council issued opinions on piloting the 30-year extension of second-round rural land contracts upon expiration. The document stipulates adherence to the principle of contract extension. Pilot programs shall be based on the results of rural contracted land rights confirmation, registration, and certification, extending the contract term by another 30 years starting from the expiration date of the second-round land contracts. The principle of "overall stability with minor adjustments" shall be upheld, where "minor adjustments" refer to appropriate, small-scale readjustments of contracted land among individual households within rural collective economic organizations. The land contracting rights and interests of members of rural collective economic organizations shall be safeguarded, and the right to information and participation of women who marry, divorce, or are widowed shall be fully guaranteed.

## Shenzhen Housing Market Sees "Mini Spring"; Second-Hand Home Signings Hit Five-Year High

According to Beike Research Institute Shenzhen, the 2026 housing market "mini spring" has arrived as scheduled, performing significantly better than the same period last year. In the 22 days following the resumption of work after the Spring Festival holiday, second-hand home signings at Beike's cooperative stores in Shenzhen increased by 19% year-on-year, reaching a five-year high for the same period. Transactions of high-quality school-district properties and medium-to-large units have increased notably since this week and are expected to become the main transaction drivers in the second half of this mini spring.

# Domestic Companies

## "Lobster" Frenzy, "Token" Explosion: Can They Boost Chinese ADRs "BAT"? Behind Alibaba Cloud's 34% Price Hike, Open-Source AI Framework "Crayfish" Sparks Token Consumption Revolution

Output pricing for mainstream Chinese AI models is generally below 20% of OpenAI's GPT-5.4, with most even less than 10%. UBS and Barclays believe that intensifying computing power shortages, surging cloud service demand, and the imminent emergence of AI SaaS monetization models for Chinese enterprises will make core Chinese ADRs such as Tencent, Alibaba, and Baidu the most direct beneficiaries.

## Unprecedented Price Hike Wave Sweeps China's Cloud Market! Following Tencent Cloud, Alibaba Cloud and Baidu Intelligent Cloud Also Announce Price Increases

Driven by the dual catalysts of explosive Token usage and rising supply chain costs, cloud infrastructure services have officially entered an inflection point from price cuts to hikes. Morgan Stanley believes that in the AI era, China's cloud market is breaking the 20-year deflationary spell, and an unprecedented price increase cycle is underway.

## Apple COO Visits China Again, Touring Longtime "Apple Supply Chain" Partners Foxconn and Sunwoda

On March 17, Apple Chief Operating Officer Sabih Khan visited two veteran "Apple supply chain" enterprises, Sunwoda and Foxconn, in succession. At Sunwoda, he inspected the intelligent iPhone battery production line featuring magnetic levitation technology and digital twin systems. At Foxconn, he toured the unmanned "lights-out" motherboard factory and MacBook assembly line. This trip covered key links from battery production to complete machine assembly, comprehensively showcasing the latest advancements in smart manufacturing within China's supply chain.

## Head of "Never-Defaulting Global Law Firm" Surrenders

Mei Xiangrong, the head of Yingke Law Firm—the world's largest law firm by number of practicing lawyers—surrendered to Shanghai police after his capital chain broke, suspected of raising funds externally under the name of "market partners." The Shanghai Municipal Public Security Bureau's Jing'an Branch has launched an investigation into the case. Numerous investors are involved, with promised annual returns as high as 27.5%. Yingke Law Firm has urgently replaced its leadership and severed ties with Mei's family businesses, announcing that daily operations remain unaffected.

# Overseas Macro

## Report: Trump Temporarily Waives Jones Act, Authorizes Foreign Vessels to Transport Energy to Stabilize Oil Prices

On March 18, the Trump administration announced a 60-day temporary waiver of the Jones Act to address soaring energy prices triggered by the Middle East conflict, allowing foreign vessels to transport oil, natural gas, coal, and other commodities between U.S. ports. The move aims to reduce fuel transportation costs on the East Coast. However, analysts note that the closure of the Strait of Hormuz has disrupted 15 million barrels per day of supply—dubbed the "largest supply disruption in history" by the International Energy Agency—rendering the impact of a single domestic policy adjustment limited.

## Bank of Canada Holds Rates Steady, Explicitly "Looks Through" Short-Term Oil Price Shocks, Focusing on Downside Growth Risks

On March 18, the Bank of Canada maintained its interest rate at 2.25%, explicitly stating it would "look through" the short-term inflationary impact of the Middle East conflict, with policy focus anchored on downside growth risks. The central bank removed the phrase "interest rates are appropriate," adopting a more flexible stance. Despite rising oil prices, February employment plummeted by 83,900 and GDP contracted by 0.6%, making growth concerns the dominant factor in decision-making. Markets interpreted the statement as dovish, with economists warning that the stabilization window may not last.

## Chemical Giant BASF: Raises Prices by Up to 30% or More for Multiple Categories in Europe

German chemical giant BASF announced that starting March 18, it will increase prices for multiple product categories in the European market, including home care, industrial cleaning, and industrial formulation products, with hikes reaching up to 30%. The company stated the move is a necessary measure to address rising costs of key raw materials, logistics, packaging, and energy.

## South Korea Cracks Down on "Dual Listing"; Stock Index Surges 5% for Third Consecutive Gain

South Korea announced a principle ban on parent companies spinning off subsidiaries for "dual listing," targeting the structural "Korea Discount" ailment. The dual listing ban will take effect on April 18, 2026, for services such as AI computing power and CPFS (Intelligent Computing Version). Prices for computing power card-related services like Pingtouge Zhenwu 810E will increase by 5-34% across all regions; CPFS (Intelligent Computing Version) prices will rise by 30% nationwide.

**Commentary:** Analysts believe Alibaba Cloud's shift from canceling discounts at the start of the year to initiating price hikes indirectly confirms the continuous increase in Token consumption following the accelerated deployment of AI Agents. 2026 marks a massive expansion year for domestic computing power. From SeedDance to OpenClaw, Token consumption is growing exponentially, further exacerbating computing power supply shortages. Coupled with NVIDIA-related policies, domestic computing power is set for explosive growth. Since the beginning of the year, overseas cloud providers such as Amazon and Google, and domestic players like Wangsu, UCloud (SH688158), Tencent Cloud, and Alibaba Cloud have successively raised prices. The explosive growth of AI Agents has driven massive demand expansion, and cloud price hikes will continue, marking the onset of a global cloud computing price increase cycle.

# Sector Highlights

## 3. Chemicals

According to Global Times, Chinese scientists have solved a century-old international challenge of preparing alkynes from alkenes using a specially active reagent, laying the foundation for rapid access to structurally diverse alkynes and new drug development. A team led by Professor Jiao Ning from the School of Pharmaceutical Sciences and the State Key Laboratory of Natural and Biomimetic Drugs at Peking University abandoned traditional halogen-based methods. Through catalytic performance research, they discovered selenanthrene—a selenium-containing heterocyclic molecule—with a unique structure and exceptional activity. It can efficiently drive the conversion of alkenes to alkynes under weak base and mild conditions, using a wide range of commercially available and naturally derived alkenes as structural templates to successfully obtain high-value alkynes.

**Commentary:** Analysts note that alkenes and alkynes are fundamental building blocks in modern synthetic chemistry with immense research and application value. This research not only broadens the synthetic pathways for alkynes but also optimizes the supply structure of certain fine chemicals, reducing reliance on complex synthetic routes and providing richer, more economical alkyne sources for pharmaceuticals, pesticides, materials, and other fields.

## 4. Titanium Dioxide

According to China Business Journal, leading domestic titanium dioxide enterprise Longbai Group recently issued a price adjustment notice, announcing immediate price increases for its titanium dioxide products. Domestic market prices will rise by 500 yuan per ton, while international market prices will increase by 100 US dollars per ton. Notably, this price adjustment comes just 14 days after the previous hike, representing an unusually rapid frequency. Driven by this move, over 20 titanium dioxide enterprises including Anhui Annada Titanium Industry quickly followed suit, issuing price increase notices with matching magnitudes. This marks the second collective price hike wave in the titanium dioxide industry this year.

**Commentary:** Analysts attribute this round of price hikes primarily to soaring upstream raw material costs. Amid prolonged price downturns, some backward and inefficient production capacities have begun exiting the market. For example, US-based Tronox announced the permanent closure of its Fuzhou plant in China, while Jinpu Titanium Industry disclosed the suspension of production at its subsidiary. This supply-side clearance accelerates industry restructuring. Demand in traditional sectors such as real estate and architectural coatings remains weak amid market adjustments. However, emerging sectors are becoming important growth drivers. Demand for titanium dioxide in new energy vehicle coatings, photovoltaic module backsheets, and other areas is growing rapidly, with a compound annual growth rate exceeding 25%. The development of wind power and high-end industrial coatings also provides stable demand for titanium dioxide.

## 5. 3D Printing

According to Qcc.com, Magic Core (Hangzhou) Technology Co., Ltd. recently underwent industrial and commercial changes, adding Huawei-affiliated Shenzhen Hubble Technology Investment Partnership (Limited Partnership) and others as shareholders. Established in 2021, the company's business scope includes cloud computing equipment technical services, artificial intelligence basic resources and technology platforms, and technical consulting services for AI public service platforms.

**Commentary:** Public information shows Magic Core Technology is a developer and supplier of consumer-grade 3D printing solutions, dedicated to exploring cutting-edge 3D AIGC algorithms and providing future solutions integrating AI modeling and 3D printing.

# Today's News Preview

- China's February RMB share in global SWIFT payments

- US initial jobless claims for the previous week

- US January new home sales

- Bank of Japan interest rate decision; Governor Kazuo Ueda holds monetary policy press conference

- European Central Bank interest rate decision; President Christine Lagarde holds monetary policy press conference

- Bank of England interest rate decision

- Japanese Prime Minister Kishida Fumio to visit the US and meet with Trump

- EU heads of state hold European Council meeting

- Earnings reports from Alibaba and Pinduoduo

- 2026 Huawei China Partners Conference

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# Risk Warning and Disclaimer

The market is risky, and investments require caution. This article does not constitute personal investment advice and does not consider the specific investment objectives, financial situations, or needs of individual users. Users should assess whether any opinions, views, or conclusions in this article align with their specific circumstances. Investment decisions made based on this article are at the user's own risk.