Global markets currently present a landscape of macro divergence running parallel to a technology-led theme. China's economy continues to tug-of-war between strong supply and weak demand; Goldman Sachs has cut its GDP forecast to the lower bound of the target range, but the policy path leans toward gradual external rebalancing rather than large-scale consumption stimulus. The U.S. Treasury market faces enormous net issuance pressure, with Deutsche Bank noting that the foreign investor holding ratio has fallen to a multi-decade low, leaving domestic sectors as the main absorbing force. Meanwhile, China's semiconductor and AI hardware supply chain is seeing dense catalysts: Bernstein highlights that breakthroughs in Huawei's LogicFolding chip and NPO architecture will reshape the domestic computing power ecosystem, while UBS data shows equipment imports hitting a year-to-date high. In commodities, damage to Russian refining capacity has pushed up refined product crack spreads, whereas the copper market faces binary risks due to tariff expectations. At the corporate level, the AI platform transformation is validating the capital expenditure efficiency of giants such as Microsoft, and the energy storage and logistics sectors are also demonstrating structural growth resilience.

Major global central banks are tightening monetary policy in sync, with the Federal Reserve raising rates to 3.75%-4.00% and terminal rate expectations shifting higher; combined with energy disruptions pushing up inflation forecasts, stagflation risk has become the core macro driver for cross-asset pricing. Against this backdrop, the AI infrastructure investment cycle remains robust, with institutions maintaining trillion-dollar-level capex forecasts and remaining bullish on monetization opportunities in semiconductors, PCBs, and enterprise software. Asia-Pacific equity markets are diverging: South Korea's supercycle and China's innovative drug policies provide structural support, while luxury goods and some Chinese consumer sectors face downward pressure from weak demand. In FX markets, the RMB and JPY are favored by institutions, and US Treasury yields are expected to rise further. Overall, as long as earnings growth materializes, rising interest rates may not necessarily damage risk assets, but the risks of highly leveraged AI infrastructure and a peak in the consumption cycle require close monitoring.

This period's institutional research focuses on three main themes: global monetary policy is being repriced under energy shocks, with divergent views between Goldman Sachs and Nomura on the rate-hiking path; China's economy exhibits a highly imbalanced profile of strong exports and weak domestic demand, with credit and social financing hitting an all-time low in 8, real estate stabilizing in tier-one cities but remaining under pressure overall; the AI industry chain is expanding comprehensively from semiconductor equipment and advanced packaging to data center power, though sustainability debates have been triggered by capital expenditure financing pressures and controversies over frontier models. Additionally, Middle East supply disruptions are pushing up oil prices, super El Niño threatens food costs, Chinese companies' overseas expansion enters a critical phase, and selective stock picking has become the consensus after biopharma valuations reached a ten-year high.

The current market is jointly driven by the structural expansion of AI infrastructure capital expenditure and the repricing of macro interest rate risks. Hyperscaler capex continues to be revised upward, driving significant supply-demand gaps in copper-clad laminates (CCL), high-end fiberglass cloth, HVLP copper foil, and optical interconnect components, ushering in a volume-and-price upcycle for upstream material suppliers; meanwhile, disorderly rising bond yields have replaced the AI bubble as the primary tail risk, with investors shifting from equities and real estate to cash and defensive sectors. China's real estate market faces deteriorating profit models due to pre-sale fund supervision policies, while companies with recurring revenue demonstrate greater resilience. On the consumer side, demand across China's beer industry has slowed comprehensively but leading players' market shares remain solid, while the cruise industry is squeezed by weakening European pricing and soaring fuel costs. In enterprise software, AI agents are deepening rather than eroding the moats of core business systems, driving a revaluation of tracks such as identity governance and ERP.

This week, institutional research focused on AI infrastructure expansion, macro interest rates and geopolitical risks, and the energy transition. Middle East tensions pushed up oil prices and intensified capital outflows from Asia-Pacific, but regional valuations at historical lows provide a margin of safety. China's AI capex is expected to reach trillions in scale, driving an explosion in demand for optical modules, switches and electronic components, while increased government bond supply is pressuring short-end yields. Data center construction bottlenecks are shifting toward labor shortages, driving higher penetration of modular solutions; European power grid investment visibility extends into the next decade. Copper prices are distorted by tariff expectations, while uranium assets and nuclear power components benefit from policy support.

Global markets are undergoing a profound restructuring driven by AI infrastructure investment, geopolitical supply disruptions, and diverging monetary policy expectations. AI capex continues to translate into structural orders for optical networking, storage, and data centers, but hardware supply chain bottlenecks and massive financing needs pose constraints; meanwhile, energy and commodity markets maintain high profit margins due to Middle East and Russia supply disruptions, while Chinese refining and chemicals benefit in the short term from tightening supply. At the macro level, rising US Treasury yields are suppressing valuations of long-duration assets, yet corporate earnings growth expectations still support medium-term targets for US equities; the Chinese stock market is showing resilience amid policy capital injections and southbound fund inflows, with rising penetration of GLP-1 drugs and platform-based consolidation in cybersecurity becoming cross-industry themes with high certainty.

AI infrastructure investment is spreading comprehensively from the cloud to enterprises, sovereigns and the edge, driving semiconductor equipment, advanced packaging, memory and power supply chains into a multi-year expansion cycle. Although massive capital expenditures by Oracle and hyperscalers are pressuring short-term free cash flow, backlogs and long-term agreements provide high visibility for hardware suppliers. Meanwhile, weak domestic demand for passenger cars in China is prompting automakers to accelerate their overseas push, while Japanese equity strategy has shifted from momentum trading to stock selection based on earnings quality. Across asset classes, fixed income duration demand remains resilient, the yen is weighed down by structural capital outflows, and commodities are diverging amid surging freight rates and tariff uncertainty.

The current market is dominated by an AI-driven semiconductor and infrastructure supercycle, with demand for memory chips, advanced packaging, and server racks continuously exceeding expectations, while traditional consumer electronics face significant headwinds. At the macro level, China exhibits a structural divergence between upstream reflation and weak downstream consumption; in commodity markets, constrained supply of aluminum and coking coal supports prices, and the lithium market is tightening due to the boom in energy storage. On the corporate side, new regulations on platform economy pricing are expected to end irrational subsidy wars, while industrial 5.0 and humanoid robots are ushering in a new decade-long capital expenditure cycle.

The current market presents a complex landscape where AI infrastructure expansion coexists with the peaking of traditional cycles. Semiconductor equipment capital expenditure is expected to slow in 2028, while shipbuilding and marine engines maintain a long upcycle driven by decarbonization demand. At the macro level, softening US labor data has prompted institutions to shift to long mid-curve Treasuries, and China's inflation rebound is mainly driven by external commodities rather than a recovery in domestic demand. Divergence on the consumer side is significant: high-income groups are shielded by the AI wealth effect, but low-income households face cash flow pressure, and luxury sales show an extreme split between resilient leading brands and sluggish weaker brands.

The current market exhibits significant structural divergence: AI-driven demand for semiconductors and optical networks remains robust, accelerating China's export growth in 8 and recording a record trade surplus, yet traditional domestic demand such as real estate and auto retail remains under pressure. Morgan Stanley has sharply cut its forecasts for China's real estate indicators, while JPMorgan notes that the brokerage sector is shifting from retail-driven to institutionally dominated business. In the new energy space, BYD's overseas expansion and strong growth in energy storage installations form the core growth engines, though they face supply chain bottlenecks and trade policy risks. Meanwhile, the investment thesis for Chinese gas utilities has shifted toward free cash flow and shareholder returns, while the healthcare sector demonstrates resilience in innovative drug commercialization.

Global markets currently exhibit significant structural divergence: capital expenditure on AI infrastructure and demand for optical interconnects continue to surge, while China's macro domestic demand, real estate, and traditional consumption still face deep adjustment pressures. Commodities remain elevated amid geopolitical disruptions, and cross-asset pricing mismatch risks are accumulating. Institutions generally recommend overweighting AI computing power with physical bottlenecks, optical communications, and the CXO sector, underweighting Chinese real estate and traditional consumption, and regionally favoring emerging markets and Europe given their valuation discounts.

The current market is characterized by AI capital expenditure spreading across the entire power and semiconductor equipment supply chain, Chinese manufacturing's overseas share rising amid exchange rate and geopolitical disruptions, and structural differentiation in new energy demand. Institutions are broadly bullish on AI-driven expansion in advanced packaging, optical networks, and energy storage systems, while flagging the potential impact of a U.S. executive order on grid equipment on Chinese exports. On the consumer side, domestic hotel RevPAR is under pressure while overseas growth for construction machinery remains strong; within the financial sector, earnings divergence between Chinese and Hong Kong banks is significant. Copper prices are strongly supported by the global supply-demand gap and the siphon effect on U.S. inventories, while European utilities are poised for an expected electrification super-cycle.