Morgan Stanley expects the global CCL TAM to grow from 190 hundred million USD in 2025 to 470 hundred million USD in 2030 (compound annual growth rate of 20%), higher than market expectations of 350 hundred million to 400 hundred million USD; meanwhile, the global PCB TAM will rise from 580 hundred million USD to 1350 hundred million USD, with AI/data center PCB demand growing more than six-fold to 860 hundred million USD, reaching a compound annual growth rate of 45%. Increased material usage per system contributed 84% to AI-related CCL growth, such as Nvidia VR300 single-rack CCL usage expected to rise to 35,601 USD.

The HVLP4 copper foil market is expected to surge from less than 5000 ten thousand USD in 2025 to 28 hundred million USD in 2030, with bottom-up models showing supply gaps of 31% and 20% in 2027 and 2028, respectively. Mitsui Kinzoku holds 41% of global HVLP4 capacity for 2026 years, while Co-Tech Development, as the fastest follower, is shifting capacity towards advanced RTF and HVLP products. Specialized equipment and low yields limit effective capacity, granting qualified suppliers strong pricing power in 2027-28.

High-end electronic-grade fiberglass cloth is listed as the most attractive material opportunity, with a projected supply gap of approximately 40% in 2026, further worsening in 2027, and easing to about 30% in 2028. Limited loom supply, tight glass roving, and rising precious metal costs constrain qualified capacity expansion. Nittobo holds approximately 90% of the T-glass market share, while Honghe Technology is becoming one of the few domestic manufacturers capable of scaling high-end electronic cloth supply by shifting capacity to special grades.

Grace Fabric's new Huangshi project plans to add approximately 1.5 hundred million meters of high-end fiberglass cloth and approximately 1254 tons of special yarn annual design capacity, targeting completion in 2027. The company's special fiberglass cloth share of annual shipments is expected to rise from 2.6% in 2025 to approximately 16% in 2028, contributing over 50% to revenue. It maintains partnerships exceeding ten years with all five major customers, and four leading global end-customers have signed agreements and paid deposits to lock in two-to-three-year capacity. Through the Huangshi yarn project, it can achieve 100% self-sufficiency in AI-related fiberglass cloth and 70% self-sufficiency in E-glass fiberglass cloth. Morgan Stanley assigns a target price of Rmb 170 and an Overweight rating based on 45 times 2028 forward P/E.

Among CCL suppliers, EMC was first rated Overweight, with a target price of NT$ 8,400 corresponding to 20 times CY28 P/E, expecting gross margins to rise from 29.8% in 2025 to 41.4% in 2028. TUC was also first rated Overweight with a target price of NT$ 2,700; its lower valuation reflects its relative lag in high-end positioning. Kingboard Laminates was first rated Overweight due to vertical integration advantages, but its high proportion of ordinary FR-4 makes it more cyclical. Co-Tech is positioned as a key second source for HVLP4 and was first rated Overweight, with gross margins expected to rise significantly from 21.8% in 2025 to 47.2% in 2028. Shengyi Technology remains Equal-weight, with the target price raised to Rmb 170.

The Rubin VR200 NVL72 rack is estimated to contain approximately 570,000 MLCCs, nearly 80% higher than the GB300 rack, driving an expected increase in dollar content per rack of 182%. Faster transmission drives the CCL sector to shift from traditional epoxy resins to PPE/OPE, BMI, and cyanate ester systems, making Mitsubishi Gas Chemical and Denka preferred resin exposures.

The AI materials group has pulled back approximately 36% from its highs after rising 91% in the previous 12 months, currently trading at approximately 26 times 2026 forward P/E, compared to approximately 35 times for PCB/CCL peers, indicating room for revaluation of upstream material suppliers relative to downstream counterparts.

Industry participants and consultants are more optimistic about optical module demand forecasts for 2026 and 2027. Almost all optical module companies showcased 800G and 1.6T products, but actual shipments will depend on supply chain management. Nomura, based on CIOE 2026 research, believes AI data center optical network demand remains strong, and 1.6T optical modules have become mainstream in scale-out networks. Upgrading to 2.4T and 3.2T optical modules faces significant optical and electronic technical challenges in the era of 400G per lane, which could lead to a longer 1.6T cycle.

NPO is seen as the next-generation technology being pushed by all Chinese industry participants, and China's rich upstream and downstream ecosystem may allow it to build a competitive advantage in this field. YOFC officially launched the CopackAlign CPO/NPO specialty fiber series, marking that the technology is moving from concept to substantive commercialization. External laser sources, optical engine packaging, and higher-bandwidth NPO architectures are mutually reinforcing components in the transition from traditional pluggable optical modules to NPO and ultimately to CPO. Industry participants believe NPO may become a persistent architecture rather than just a transitional solution, but some still prefer pluggable solutions for large-scale horizontal expansion deployments.

Cloud vendor deployment roadmaps are clear: Alibaba aims to achieve mass production of 3.2T NPO modules and QFabric switches in 4Q26, and achieve 6.4T UPO production around mid-2027; Tencent aims to deploy 512 accelerator supernodes using 3.2T NPO in 1Q27. NPO optical engine bandwidth is moving from 3.2T to 6.4T, HiSilicon's integrated light source design may reach 7.2T, and VCSEL remains an active NPO path for short-distance applications.

Progress in External Laser Source (ELS) technology: EugenLight under USI showcased an eight-channel ELSFP with power consumption of approximately 12W and optical output per channel exceeding 23dBm; Source Photonics showcased a 6.4T ELSFP using internal CW lasers and plans to launch a 200mW CW product for NPO in 1Q27. ASMPT's flux-free TCB process supported by Atmospheric Oxide Removal does not require flux, making it particularly suitable for next-generation optical engine packaging and promising to solve warpage and contamination challenges.

Regarding supply bottlenecks, yields for 100mW-plus CW lasers and 200G EML/PD chips still need improvement, while high-end components such as 3nm DSP, mSAP PCB, and multi-core fibers face shortage risks. Supply constraints may drive Chinese optical communication companies to expand their global market share. Innolight, Eoptolink, and YOFC are listed as key beneficiaries of positive FCC progress, optimistic demand outlooks, and potential NPO leadership. Latest FCC progress is described as positive, and leading optical module companies are not expected to be significantly affected. The 2026 China International Optoelectronic Exposition (CIOE) attracted a record number of 100,000 visitors.

Fiber optic demand for hyperscale AI data centers may be 5-10 times that of traditional data centers, with AI-driven data center fiber optic demand CAGR expected to exceed 20% from 2025 to 2030. However, aggressive capacity expansion by Corning, Fujikura, and Furukawa Electric may gradually normalize supply and demand, creating pressure on fiber optic prices and margins in the medium term. Celestica expects its 1.6T network projects starting from 4Q26 to exceed 800G revenue in 2027, while co-packaged optics will only form a substantial contribution when 3.2T switches become widespread around 2029 to 2030.

The NPO market has not yet formed unified standards, and early participants are expected to gain higher value and margins through customized solutions. Cigna AI expects OCS revenue to exceed 20 hundred million USD in 2026 and exceed 80 hundred million USD in 2030, but architectures such as liquid crystal, MEMS, and silicon photonics remain fragmented. The scale-in network proposed by NVIDIA, driven by BlueField-4, is seen as a potential driver for the future of AI networking.

JPMorgan points out that the "828" policy delays mortgage fund disbursement until completion, causing cash representing 60-70% of pre-sale receipts to be delayed by 12-18 months. Under the new pre-sale model, project IRR drops from 14.4% to 5.1%, levered IRR drops from 29.8% to 6.8%, and financing costs doubling or more may reduce profit margins by 1-2 percentage points. In the base case, FY27 contracted sales are expected to decline 20-30% year-on-year, as developers replenish sellable resources annually equivalent to only 80% of annual sales. Due to a lag of approximately two years in profit recognition, if FY27 sales decline by 20-30% and margins remain unchanged, FY29 earnings will fall by approximately 20%; if margins drop another 2%, the earnings decline will reach 40-50%.

SOE developers' 1H26 core net profit averaged a year-on-year decline of 40%, with development business margins compressed from 15% in 1H25 to 13% in 1H26. Divergence in the property management segment continues, with SOE-backed property management companies seeing core profit growth of 4% in 1H26, while private-backed peers saw a decline of 4%. Although Longfor has low default risk, its cash flow safety margin has narrowed, and FY26 core net loss is expected to widen to Rmb 5.4bn. CMSK had net profit margins below 1% in FY25 and 1H26, and its 0.6x P/B valuation is relatively high. Poly, Longfor, and Jinmao were downgraded from Overweight to Neutral, and CMSK was downgraded from Overweight to Underweight. The industry currently trades at 0.44x P/B, with 17% potential downside compared to the 0.36x trough P/B.

Companies with recurring revenue exhibit defensive attributes: CR Mixc derives approximately 70% of profits from commercial operations, facing limited disturbance from pre-sales, with FY26 earnings growth expected at 10%; KE Holdings' second-hand housing business contributes 36% of profits and may benefit from reduced new home supply. CR Land derives over 50% of profits from recurring revenue, so even if FY27 contracted sales decline by 20%, the impact on net profit is less than 10%. JPMorgan estimates that in the downside scenario, CR Land's FY29 earnings impact is -6%, while Overseas Chinese Town's is -18%.

First-tier cities, especially Shanghai, are showing signs of mild stabilization. Broader housing price stabilization and margin recovery may appear in 2027 or 2028. However, there is currently no evidence that the four re-rating drivers—nationwide policy easing, housing price growth outside Shanghai, margin recovery, and stronger sales momentum—are materializing. The 7% drop in New World Development's share price after earnings was mainly driven by some hedge funds expecting profit growth of 10-20% versus an actual figure of only 5%, as well as the delayed recognition of proceeds from the sale of San Tin agricultural land. JPMorgan does not expect significant broad housing policy relaxation or tightening in the Hong Kong Five-Year Plan and Policy Address to be released on 9 16. Risks to the base case include an increase in the stamp duty rate for super-luxury homes from 6.5% to over 7%, or a threshold below HK$1 hundred million.

Goldman Sachs believes further rate hikes lack sufficient economic justification, as inflation exceeding targets is mainly due to fading one-off factors and the economy is not overheating. FOMC participants are expected to support one rate hike in 2026 by a majority of 10 to 8, but the risk of multiple hikes predicted by more participants is skewed to the upside. Goldman's own forecast is for one initial hike, followed by cuts in 9 and 12 of 2027, bringing the terminal rate to 3.25% to 3.5; its probability-weighted forecast is less hawkish than market pricing. Tariffs are expected to have pushed up commodity prices, making recent inflation broad-based, but future additional impacts are limited. PCE inflation in 2026 is forecast at 3.4%, core PCE at 3.2%, with both indicators falling to 2.2% in 2027. Real GDP growth rates are 2.0% in 2026, 2.2% in 2027, and 2.3% in 2028, with the unemployment rate at 4.2% before 2029.

Goldman Sachs raised its forecast for the 10-year UK gilt yield at end-2026 from 4.4% to 5.0%, simultaneously raising US Treasury and German Bund yield forecasts to 4.75% and 3.25%, respectively. A new forecast suggests the Bank of England will hike rates in 11, and a faster pace of hikes than priced in by the market is a key curve-flattening risk. The UK has the largest increase in term-weighted bond supply and the greatest restructuring of long-end demand, making the market highly sensitive to macro volatility. The budget at the end of 10 is the next major test. In G10, UK gilts have the highest sensitivity to energy prices and global interest rate changes. Despite selling pressure on UK gilts, swap spreads remain at their widest levels of the year, indicating no immediate supply pressure is evident.

Bank of America's 9 month broad sentiment indicator fell from 8.0 to 7.0, and the cash ratio of assets under management rose from 3.5% to 3.9%. 55% of respondents expect the economy not to land in the next 12 months, only 2% expect a hard landing, but stagflation expectations account for 50%. Global equity allocation decreased from net overweight 56% to 49%, and government bond underweight expanded to net underweight 48%, the lowest since 5 2022. Real estate allocation expanded from net underweight 7% to net underweight 21%. Disorderly rising bond yields replaced the AI bubble as the primary tail risk at 33%, with the net percentage expecting short-term rate increases reaching 36%, a new high since 9 2022. More respondents believe the Fed is behind the curve, with the percentage expecting a Fed hike before the 11 midterm elections rising from 22% to 41%.

In regional allocation, emerging market equity overweight increased from 34% to 38, the Eurozone shifted from net overweight 6% to net underweight 5%, and Japan shifted from net overweight 1% to net underweight 1%. US equity overweight slightly decreased from 27% to 25%, while UK equities remained deeply underweighted at net underweight 35%. By sector, bank overweight rose to 34%, insurance shifted from underweight 10% to overweight 3%, and healthcare overweight rose to 36%. Consumer staples underweight expanded to 33%, the largest underweight since 1 2004, and consumer discretionary underweight expanded to 21%. Long global semiconductors at 53% continues to be the most crowded trade; 42% of respondents believe AI hyperscaler capex is the most likely source of a systemic credit event, but 79% do not expect capex cuts in 2026. Suggested contrarian trades include long UK equities/short US equities, long consumer staples/short banks, and long small-caps/short large-caps.

JPMorgan maintains an overweight stance on Chinese equities, setting year-end targets of 100 for MXCN and 5,200 for CSI-300, supported by consensus EPS year-on-year growth of 14% and 25%, respectively. However, short-term headwinds include tightening monetary policy, deteriorating Asian QMI cycle indicators, risk aversion ahead of US midterm elections, and unfavorable seasonality, which may make the second-half rebound path tortuous. Low expectations for the Trump-Xi summit on 24 9 can buffer downside risks; the base case expects limited trade and AI governance dialogue rather than a comprehensive agreement.

Anti-involution actions have produced significant differentiation: logistics, chemicals, coal, and battery materials have entered the quadrant of rising capex and destocking, exhibiting a combination of revenue growth and margin recovery. The logistics industry benefits from policy-guided price coordination and capacity upgrades; STO Express 1H26 net profit was approximately RMB10 hundred million, up 128.3% year-on-year, and J&T Express is listed as the top pick in the industry. Chemical and refining industries are driven by geopolitical disruptions and supply-demand recovery; Rongsheng Petrochemical's first-half profit grew 749% year-on-year, and Wanhua Chemical's net profit grew 64% year-on-year. Conversely, autos, baijiu, and photovoltaics remain in the quadrant of falling capex and restocking, facing fierce competition, low capacity utilization, or high inventory pressure.

AI remains a primary growth theme and outperformed the broader market in 2Q26 financial results; JPMorgan favors domestic AI supply chain companies such as Iluvatar CoreX, V-Test, JCET, AMEC, and NAURA. However, Tigermed's AI-related spending this year is expected to be approximately RMB2 hundred million, far higher than last year's approximately RMB5000 ten thousand; management-claimed efficiency gains have not yet been validated for their hedging effect within a full budget cycle, constituting actual margin pressure. Tigermed 1H26 new orders grew 30% year-on-year and non-GAAP profit grew 31.8%, but fair value losses on the investment portfolio led to a reported net loss of RMB4.132 hundred million; based on this, JPMorgan maintains an Underweight rating for A-shares and Neutral for H-shares. Dec-27 target prices were raised to RMB44 and HK$44, respectively, but the current 37x FY27E P/E requires near-flawless execution.

Increasing industry-specific trade safeguards, anti-dumping, and countervailing investigations in Europe, South America, and Southeast Asia may limit Chinese companies' overseas expansion and depress P/E ratios. MXCN's overseas revenue exposure rose to 18% in 1H26, reaching as high as 56% in the IT sector, putting valuation pressure on export-oriented companies.

Goldman Sachs believes AI-driven network demand is a core industry theme; Cisco noted that agentic AI increases network bandwidth consumption by 5 times and maintained guidance for mid-point revenue growth of 15% in FY2027. Dell described AI adoption as the early stage of a multi-year infrastructure curve, having secured over 6,500 AI Factory customers; HPE cited a 35 hundred million USD enterprise inference order. Penguin Solutions is expanding its model to cover AI Factory systems, ClusterWareAI, and managed services, supported by 3 to 5-year contracts for recurring revenue. AI demand is spreading from hyperscalers to enterprise and sovereign markets.

Hardware margin performance is divergent: Arista maintained its FY2026 gross margin guidance of 62% to 64%, benefiting from price increases and supply chain efficiency; however, Cisco expects AI deployments with a high hardware mix to drag down product mix gross margins. Component shortages and inflation (especially memory and network chips) may depress gross margins or delay deployments, while white-box and Chinese supplier competition intensify price pressure. Goldman Sachs maintains Buy ratings on Arista, Axon, NetApp, Dell, HPE, Celestica, and Penguin Solutions; Neutral on Cisco, Ingram Micro, and F5; and Sell on HP, Super Micro, and Cricut.

Goldman Sachs notes that approximately 60% of Navan's customer support interactions are now autonomously resolved via AI agent Ava. Navan's new contract GBV grew 60% year-on-year to $40 hundred million, a quarterly record. Through the acquisition of BoomPop, it expanded its business from travel to meetings and events, a market representing approximately 30% of the total private travel and events opportunity. Navan differentiates itself from traditional competitors relying on human agents through proprietary data models (accounting for 50% of AI usage) and vendor agreements built over many years. Goldman Sachs maintains a Buy target price of $27 for Navan, using a fundamental value of 5.0x EV/Sales weighted at 85% and an M&A value of 8.0x EV/Sales weighted at 15%.

JPMorgan expects total capex from major cloud providers to rise from $4375.6 hundred million in 2025 to $8649.6 hundred million in 2026, $1.408 trillion in 2027, and $1.684 trillion in 2028. Total data center AI chips are expected to increase from 1032 ten-thousand units in 2025 to 3117.3 ten-thousand units in 2028, with a CAGR of 45% over the same period. This capex outlook constitutes the core input for demand forecasts for AI chips, memory, advanced packaging, and semiconductor production equipment.

Multi-layering, miniaturization, chiplets, and known-good-die requirements will expand demand for process control, inspection, packaging materials, and back-end equipment. Increased complexity in advanced packaging brings structural increments to niche areas such as X-ray metrology and dicing equipment. JPMorgan expects Tokyo Electron's FY3/27 revenue to reach ¥3.419 trillion and operating profit to reach ¥1.059 trillion; Advantest's FY3/27 operating profit to reach ¥9280 hundred million with a margin of 53%. For memory, Kioxia's FY3/27 revenue is expected to be ¥10.24 trillion, a significant increase from FY3/26, with SSD and Storage businesses driving rapid expansion in sales and profits. JPMorgan assigns Overweight to Kioxia, Tokyo Electron, and Advantest, but maintains Neutral on Disco and Underweight on Nikon.

Utilization of approximately 1.5 GW of operational data center capacity in Johor has risen to approximately 70%, a significant increase from approximately 50% a year ago, confirming real demand more reliably than project pipeline size. The Data Center Task Force has implemented a stricter approval framework, requiring projects to demonstrate off-takers, power and water commitments, and renewable energy plans, which is viewed as a positive screening mechanism rather than a cyclical suppressor. Johor currently accounts for approximately 70% of operational capacity, but as land and power tighten, latency-insensitive AI training workloads are expected to spill over to Selangor and Cyberjaya, gradually reducing Johor's share to approximately 65%.

Even after absorbing approximately 6 GW of data center load, system reserve margin is still expected to rise from approximately 28% in 2025 to approximately 31% in 2031, indicating sufficient generation capacity but making grid connection timing a key constraint. Self-generation is becoming a pathway for operators to bypass conventional grid connection waits, potentially accelerating approvals for uncommitted projects and forming a new private sector power capital expenditure pool. New data centers must procure 25% to 35% renewable energy electricity, with CRESS-related opportunities reaching up to RM60bn (US$15bn). Gamuda and YTL Power are considered best positioned to capture self-generation opportunities and provide integrated power, water, and renewable energy solutions, both rated Overweight. Tenaga is viewed as the preferred beneficiary and rated Overweight, but grid connection delays may postpone its power demand realization.

Water supply reserve margins in Johor and Selangor are approximately 16% and 12%, respectively; if water treatment plants are delayed by two years, these could drop to approximately 4% and below 1%, while funding for replacing approximately 39,000 km of aging pipelines is severely insufficient. Aging water distribution networks and funding gaps constitute multi-year physical constraints on data center expansion.

Goldman Sachs believes global optimism regarding nuclear power fundamentals is strengthening, but the upstream fuel chain remains the least clear part of investment and industry logic. Producers maintain production discipline and tend to reduce output, so structural uranium shortages may persist. Divergence between limited existing capacity and ramp-up of new supply provides floor support for uranium spot and long-term prices. In 8, U3O8 spot prices rose from approximately $87/lb to approximately $90/lb, and long-term prices rose from $94/lb to $96/lb, despite weak seasonal trading volumes. Prices remain firm even with spot trading volumes below historical levels, indicating that utility buying interest and supply security concerns are dominating pricing.

Following the announcement of frameworks for the US and South Korea to build 8 large nuclear reactors, interest in US large reactor development has increased, but comprehensive EPC and insurance products remain scarce. China added one to the global total of reactors under construction, while Kazakhstan, Russia, and others have clear EPC contracts or capacity expansion plans. Substantial progress in reactor construction across multiple countries further consolidates the long-term growth trend of global nuclear installed capacity. NexGen Energy has begun construction of the Rook I uranium project, expected to produce approximately 3000 ten thousand pounds of uranium annually after a four-year development period; Urenco is expanding its US enrichment facilities to increase capacity by nearly 50%. Capacity expansion at key mining and enrichment nodes is core to alleviating future fuel bottlenecks, but commissioning timing remains uncertain.

Akeso's ivonescimab HARMONi-2 updated data shows median overall survival of 30.8 months in the intention-to-treat population of first-line PD-L1 positive NSCLC, significantly superior to pembrolizumab's 22.6 months, with an OS hazard ratio of 0.73 (p=0.009). The OS hazard ratio for squamous cell patients is 0.65, and for patients with PD-L1 TPS of at least 50%, it is 0.58, enhancing confidence in the HARMONi-3 squamous cell cohort and the HARMONi-7 global Phase 3 trial. Based on a DCF model projecting free cash flow to 2034, JPMorgan maintains an Overweight rating and a target price of HK$125, with valuation reflecting expectations of AK104 China peak sales of approximately Rmb70 hundred million and AK112 ex-China exceeding US$50 hundred million. Nomura also emphasizes that progression-free survival advantage successfully translated into overall survival benefit, but warns that poor HARMONi-3 data, slower-than-expected sales growth, and clinical setbacks of other assets may hinder target price achievement.

Hansoh Pharma's HS-20093 achieved a median overall survival of 18.5 months in second-line SCLC, and MediLink's YL201 achieved 13.3 months, both with hazard ratios of 0.46. Both B7-H3 ADCs reached the primary endpoint of overall survival, validating the value of this target in Phase III SCLC studies and setting a new record. China's NMPA has accepted biological product license applications for HS-20093 and YL201, and their overseas rights have been licensed to GSK and Roche respectively, supporting the view that Chinese oncology assets are competitive at the global drug R&D frontier.

Nomura interviews show that marketing activities weakened after anti-corruption campaigns intensified, but recovered from 50% to 60% in 5 to 6 to normal levels of 70% to 80% in 7 to 8, aiding the recovery of oncology drug sales. Experts expect stricter drug promotion compliance requirements to become the new normal, potentially reducing sales expense ratios for pharmaceutical and biotech companies by 5 to 6 percentage points, directly improving profitability. Experts estimate biosimilar centralized procurement price cuts at approximately 60% to 80% to 90%, significantly stricter than Nomura's previous expectation of approximately 50%. Experts believe PD-1 inhibitors have matured with limited growth, while ADC drugs have higher potential; lung cancer and breast cancer drugs are the main areas of competition for major pharma companies. More multinational pharma companies will grant commercialization rights for mature drugs to local pharma companies in the future.

Bernstein points out that AI coding agents using project management LoB platforms directly consume less than 50% of tokens, taking less time to complete tasks with higher success rates. Early evidence refutes concerns that AI will bypass enterprise software, proving that existing LoB systems are efficient operating environments for agents rather than obstacles. Once organizations build effective agents around customized workflows, rebuilding them on other platforms will incur high and risky switching costs. Defensibility of collecting static data has declined, but proprietary dynamic operational data and workflow integration are forming a new data flywheel moat. Datadog's dynamic real-time data flywheel and product iteration speed are considered more important than traditional network effects.

SMB software, simple CRUD applications, and end-user productivity software face the greatest risk of disruption by AI-native entrants. ERP is considered the most protected enterprise application market, followed by HCM, while CRM has lower protection. The status as a core system of record gives vendors like SAP and Oracle stronger defensibility in the AI wave. Bernstein believes SAP and Microsoft are the most likely AI winners within its coverage.

Goldman Sachs reports that SailPoint management believes agentic AI is making identity governance strategically more important, as the scale and autonomy of non-human identities far exceed those of traditional users, requiring governance rather than simple authentication. Even before the proliferation of agentic AI, penetration of the core identity governance market remains low, and the company views its $8 hundred million AI target as a directional incremental opportunity. SailPoint considers cross-platform neutrality and deep permission modeling as competitive moats, believing Microsoft, ServiceNow, and Okta lack its integrated governance capabilities. The Agentic Acceleration program is expected to shorten migration projects that took months to weeks, and explores eliminating up to 90% of migration costs. Goldman Sachs maintains a Neutral rating and a 19 USD target price for 12 months, with valuation weighted by 85% fundamental value (6x EV/Sales) and 15% M&A value (10x EV/Sales).

Bernstein analyzes Capgemini, noting that AI will only change its investment logic when it changes what it sells; true Services-as-Software requires companies to be accountable for measurable outputs or business results. Traditional IT services profit through headcount, hours, and utilization, and AI can reduce personnel needed for coding, testing, and support, bringing risks of decreased billable workload and price pressure. The WNS acquisition adds business process knowledge, providing a bridge for the company to shift from a project-based business to recurring, outcome-oriented delivery. Generative AI and agentic AI accounted for approximately 15% of total orders in 2Q26, but orders are only leading indicators; gross margin, revenue per employee, and cash conversion are more meaningful than AI-labeled orders. Bernstein predicts Capgemini's gross margin will rise from 27.0% in 2025 to 27.4% in 2027, maintaining an Outperform rating, with target price lowered from €208 to €154. Enterprise AI orchestration may be a defensible role for integrators, as fragmented enterprise environments still require cross-platform architecture, governance, workflow coordination, and outcome accountability.

Goldman Sachs reports Empyrean has achieved full-process coverage in simulation, panel, and memory EDA fields, and is expanding into digital design, foundry, PCB, and advanced packaging tools through internal R&D, investment, and acquisitions. Management expects to achieve coverage of all EDA tool categories by the end of 2026 and plans to launch full-process digital design and foundry EDA tools by the end of 2027. 2Q26 revenue grew 16% year-on-year, higher than 10% in 1Q26, as major customer orders are recovering and spending by local memory and logic foundries is rising. Due to multi-year terms for previous GPU and CPU customer orders, digital design EDA growth in 2026 is expected to be moderate. Goldman Sachs maintains a Neutral rating and a Rmb125.00 target price for 12 months, based on applying a 45x multiple to 2029E EPS and discounting back to 2026E at a 11.5% cost of equity.

Goldman Sachs and JPMorgan point out Roblox is focusing on the adult user group aged 18 and above, which accounts for approximately 80% of global gaming spend, and US adult users monetize at levels more than 50% higher than minor users. The platform is broadening experience boundaries by introducing diverse content formats such as 2D, 2.5D, 3D, and offline single-player, where 2D content accounts for approximately 33% of US gaming spend and is preferred by users aged 25 and above. Enriching content types helps attract adult players with different preferences, expanding the platform's serviceable market size.

The Roblox Everywhere initiative allows creators to publish standalone applications on mobile, PC, and consoles, with support for direct game access via the Chrome browser expected by the end of 2026, and offline single-player games planned for release in mid-2027. Breaking through the limitations of closed app ecosystems will significantly expand the platform's reach, supporting its long-term goal of reaching 10 hundred million daily active users. The optimization window for the recommendation algorithm has been extended from the first week to the first 28 days and beyond, aiming to balance retention, lifetime value, and monetization, while direct growth optimization measured by new player acquisition is currently being tested. However, management acknowledges that adjusting the recommendation algorithm to prioritize long-term player outcomes may negatively impact short-term monetization.

Since Build launched its alpha test in New Zealand, approximately 9,000 games have been produced, with about 71% of users having previously not used Roblox Studio, indicating that AI tools have effectively lowered the barrier to creation. The number of qualified and registered developers reached a record high of over 42,000 in the second quarter. Spending by Roblox Plus subscribers is up to 7 times that of non-Plus users, with engagement levels at 2.1 times higher. The platform plans to test pre-roll ads during game loading in the coming months, and 71 out of the top 100 games year-to-date have run sponsored experiences. Roblox Wallet will allow creators to earn revenue directly in real currency, supporting automatic payments on business days and cross-account transfers, with a launch scheduled for later in 2026 for independent creators aged 18 and above in the United States.

Regarding valuation, JPMorgan holds an incrementally positive view on Roblox's operating trajectory but maintains a Neutral rating, with the stock price at $45.50 as of 11 9, 2026. Goldman Sachs reiterated its Buy rating and maintained a 12-month target price of $60, implying upside potential of 31.9%, based on an equal-weighted combination of EV/Bookings multiples and a modified DCF framework.

Morgan Stanley noted that total shipments for the top five laptop ODMs in 8 2026 were 730 ten thousand units, down 11% month-on-month and 35% year-on-year, missing expectations by 19%. Channel partners and distributors had previously accumulated inventory, causing OEMs to slow sales to channels, which was the main reason for the below-expected shipments in 8. The end of pull-forward demand and accumulation of channel inventory led to ODM shipments significantly lower than expected, reflecting weak end-user demand.

Morgan Stanley cut its 3Q26 finished unit shipment forecast by 7% to 2540 ten thousand units and provided its first 4Q26 forecast of 2390 ten thousand units, expecting CY26 finished unit shipments for the top five Taiwan ODMs to be approximately 1.088 hundred million units, down 16% year-on-year. Continuous downward revisions to quarterly shipment forecasts and levels weaker than historical seasonality indicate that the industry faces overall downside pressure in the second half. Despite weak total shipments, Morgan Stanley still expects the laptop product mix to continue shifting towards higher-end, higher-margin models, which could partially offset the negative impact of shipment declines on profitability.

JPMorgan tracking shows that for the week ending 11 9, 2026, visible copper inventories in China decreased by 10 kt to 94 kt, with the destocking speed lower than historical seasonal trends, partly attributed to high copper prices suppressing physical buying. Visible aluminum inventories decreased by 19 kt in a single week to approximately 796 kt, continuing a destocking trend faster than historical levels since mid-5, returning within the five-year range. The opening of export arbitrage windows drove a significant drop in zinc inventories, but total inventories of 218 kt remain at the highest level since 2022; JPMorgan expects continued outflows could push zinc prices down to approximately $3,500/t by year-end. The US government has not yet decided whether to impose tariffs on refined copper imports; LME copper prices fell by approximately 4% intraday at one point, but JPMorgan still expects the US to implement copper import tariffs.

China's weekly steel production decreased by 7.4% year-on-year to 7.94 Mt, apparent consumption decreased by 3.7% year-on-year to 8.12 Mt, and average losses for steel mills expanded to over RMB600/t. Freight costs for bulk iron ore from Brazil to China rose to $42.4/t; higher freight costs may further depress realized FOB prices for miners. Rising freight costs combined with coking coal costs increasing by over 30% in two months are squeezing profits in the steel industry chain from both sides.

Bernstein noted that European cruise pricing in 9 returned to mid-single-digit declines, while Caribbean prices remained roughly flat year-on-year. Regional divergence indicates uneven recovery in cruise demand, with ongoing geopolitical tensions in Europe continuing to suppress local pricing power. RCL's like-for-like listed prices in 9 decreased by 1.3% year-on-year, and by 2.9% excluding the impact of the new ship portfolio, confirming that the pricing inflection point in 8 did not extend to 9, with the Royal Caribbean brand remaining the primary source of weakness. Affected by low river water levels in Europe, Viking's listed prices for the Rhine and Danube from 7 to 8 2027 decreased by 1.5% to 3.5% compared to early 7. Despite weak pricing, approximately 5% of Rhine and 6% of Danube capacity for the third quarter of 2027 has been sold since early 7, indicating underlying booking demand still exists.

MGO prices have risen by approximately 40% since Carnival last provided guidance, and the company has not hedged fuel, facing the largest fuel cost headwind, which could materially compress its margins and affect upcoming earnings guidance. With hedges and higher margins, RCL's sensitivity to oil price changes is about one-quarter that of Carnival, translating its financial hedging strategy into a significant relative competitive advantage during fuel inflation cycles. Bernstein maintains Outperform ratings for Viking and Royal Caribbean, and Market Perform ratings for Carnival and Norwegian.

Bernstein noted that total beer sales in China in 8 2026 decreased by 4% year-on-year, worsening further from the 2% decline in 7, primarily driven by the expansion of declines in the non-on-premise channel to 5%. Broad declines appeared across almost all provinces and price bands, but Guangdong grew against the trend by 9%, becoming the strongest performing major province, while Shandong declined by 17%, dragging down the industry. A comprehensive slowdown in demand during the summer consumption peak indicates significant macro headwinds for Chinese mass consumer goods.

CRBeer's sales in 8 increased by 1% year-on-year; although significantly slower than previous months, it maintained positive growth and gained market share against the backdrop of industry contraction. Regression analysis based on BigOne sales data suggests CRBeer's third quarter revenue growth is expected to be approximately 1%. Bud China's sales in 8 decreased by 12% year-on-year, with both food service and non-on-premise channels declining by 12%; it performed the weakest among all major brewers with accelerating share loss, and regression analysis predicts its third quarter revenue could drop significantly by approximately 12%, though 9 faces an unusually easy comparison base. Tsingtao's sales in 8 decreased by 4% year-on-year, with a plunge of 22% in food service sales in its core market of Shandong constituting the main pressure point. Bernstein maintains a HK$7 target price and Market Perform rating for Bud APAC, maintains a HK$24 target price for CRBeer, and assigns an Outperform rating and HK$47 target price to Tsingtao H-shares.