Summary of Key Points from the Conference Call Industry Overview - The focus is on the **technology sector** in China, with signs of a resurgence in **animal spirits** primarily driven by recent tech breakthroughs and significant capital expenditure (capex) plans from major companies like **Alibaba** [1][3]. Core Insights - **Animal Spirits Return**: There are early indications of a revival in business confidence, particularly in technology, as evidenced by Alibaba's unexpected capex announcement, which exceeded market expectations [3]. - **Economic Performance**: The broader economy is showing mixed signals; while exports remain robust, the construction and housing markets are lagging. Post-Chinese New Year (CNY) data indicates strong exports but weak performance in non-manufacturing sectors [1][4][5]. - **Government Focus on Tech**: Recent entrepreneur symposiums hosted by President Xi have shifted focus towards emerging technologies such as AI, robotics, and autonomous driving, moving away from traditional industries [2]. Economic Indicators - **Manufacturing Resilience**: Manufacturing activities are stable, supported by strong road freight traffic, indicating a robust supply chain and production efficiency [4][13]. - **Weak Construction Sector**: The construction sector's recovery post-LNY has been slow, with a significant drop in the resumption rate of construction projects compared to previous years [5][29]. - **Housing Market Trends**: New home sales in major cities have been underwhelming, reflecting a diminishing impact from recent property easing measures [5][34]. Additional Insights - **Labor Market Dynamics**: The return of migrant workers to major cities is slower than usual, which may impact both construction and service sectors [5][31]. - **Consumer Behavior**: Consumption remains stable, bolstered by trade-in programs for home appliances, indicating some resilience in consumer spending despite broader economic challenges [4][23]. Conclusion - The technology sector is poised for growth, driven by innovation and investment, while traditional sectors face challenges. The mixed economic signals suggest a cautious outlook, with potential opportunities in tech and ongoing risks in construction and housing markets [1][2][3][4][5].

Summary of the Conference Call on Potential Oil Tariffs Industry Overview - The discussion revolves around the potential impact of a proposed 10% tariff on all US oil imports, particularly focusing on crude oil and refined products [2][6][8]. Key Findings 1. **Tariff Impact on US Production**: - A 10% tariff is unlikely to significantly boost US oil production due to a mismatch between the light oil produced in the US and the heavy oil demanded by refiners [2][6]. - The estimated increase in WTI and Brent prices would be modest, around $0.5/bbl, with a slight increase in US production [2][6]. 2. **Cost Distribution**: - Ex-US oil producers would bear an annual tariff burden of approximately $10 billion, primarily affecting heavy oil producers from Canada and Latin America [2][57]. - US consumers are expected to incur an estimated $22 billion annual cost from the tariff, translating to about $170 per household [2][57]. - The US government would gain around $20 billion in annual revenues from the tariff [2][57]. 3. **Refined Product Prices**: - The tariff is projected to increase refined product margins by $6/bbl, leading to higher retail gasoline prices, particularly on the US East and West Coasts [2][51][53]. - The average US retail gasoline price is expected to rise by approximately $0.07/gal, with larger increases on the East and West Coasts [2][53]. 4. **Market Dynamics**: - The tariff would primarily transfer costs from ex-US producers and US consumers to the government and refiners/marketers [2][55]. - The overall global costs would remain small due to largely unchanged import volumes, but could increase with higher tariffs [2][63]. 5. **Refinery Preferences**: - US refiners are uniquely equipped to process heavy crude, which would continue to flow into the US despite the tariff, as Canadian producers have limited alternative markets [2][33][40]. - The refining system's historical investments in heavy crude processing limit the potential for significant shifts in trade flows or production increases [2][16]. Additional Insights - **Consumer Price Sensitivity**: - Coastal regions (East and West) are particularly sensitive to price changes due to a lack of local crude production and refining capacity, making them reliant on imports [2][41][45]. - The tariff's impact on refined product prices is expected to be more pronounced in these regions due to their inelastic demand for oil imports [2][41]. - **Long-term Outlook**: - Despite the potential tariff, the US liquids supply outlook remains solid, with expected growth in US liquids production contributing significantly to non-OPEC supply growth in 2025 [2][64]. - **Hedging Recommendations**: - Canadian crude differentials are viewed as a short opportunity in the event of an oil tariff, while New York Harbour refined products are seen as compelling long opportunities [2][67][68]. Conclusion - The proposed 10% tariff on US oil imports is expected to have a complex impact on the market, primarily affecting consumer prices and ex-US producers while generating significant revenue for the US government. The overall production response is likely to be limited due to the structural characteristics of the US refining system and the nature of crude oil imports.

21 February 2025 | 2:50AM HKT Bilibili Inc. (BILI) Earnings Review: 4Q in-line, ads clear outperformance and eyes on potential game recovery; Buy | BILI | 12m Price Target: $23.70 | Price: $20.33 | Upside: 16.6% | | --- | --- | --- | --- | | 9626.HK | 12m Price Target: HK$185.00 | Price: HK$154.80 | Upside: 19.5% | Bili reported a largely in-line 4Q24 print and its first positive gaap profit quarter. Into 2025 and amid the rising AI enthusiasm, we see Bili is in a good position to benefit from AI, on the ba ...

FICC Research Credit Strategy 21 February 2025 US Investment Grade US exporting supply The pickup in reverse Yankee issuance year-to-date stands out versus slightly underwhelming $-IG supply volumes. With little difference on a hedged basis, the outright yield differential is likely the driver. We screen for US issuers with upcoming € maturities that may come to the market next. A number of reverse Yankee deals in the past few weeks have put the spotlight on cross-border issuance in €-IG. At a high level, € ...

FICC Research Economics 21 February 2025 China Outlook Rising animal spirits China's H shares outperformed amid the AI breakthrough. CNY stabilised with "Mar-a-Lago Accord" talk gaining momentum. President Xi's symposium with entrepreneurs sent supportive signals. We think key things to watch for the NPC include the growth and inflation target, and fiscal package. Equity re-rating; CNY stabilises The DeepSeek breakthrough has led to a valuation re-rating in China's H share market. At the time of writing on ...

A c t i o n | 20 Feb 2025 21:35:56 ET │ 19 pages China Healthcare Potential Catalysts Ahead for CXOs: Top-Line Acceleration and Margin Expansion CITI'S TAKE Following our deep-dive report on leading CXOs in Nov 2024, leading CXO companies rebounded significantly on solid earnings delivered in FY24, strong project number and geopolitical uncertainty removed. We are positive on potential guidance revise-up in the mgmt. briefing after FY24 earnings release, thanks to accelerated backlog growth, capacity utiliz ...

USA: UMich Long-Term Inflation Expectations at Highest Since 1995; S&P PMIs Below Expectations on Net; Existing Home Sales Decline 21 February 2025 | 12:01PM EST BOTTOM LINE: The University of Michigan's index of consumer sentiment was revised down in the February final report, below expectations. The report's 1-year inflation expectations measure was unrevised at 4.3% while the 5-10-year measure was revised up by 0.2pp to 3.5%. The S&P Global US manufacturing PMI ticked up in February, roughly in line with ...

Flash | 20 Feb 2025 20:00:56 ET │ 11 pages China Communication Infrastructure Quick Read-Through from 3QFY25 BABA Result; Cementing Our View on Industry Capex Up-Cycle; IDC/Optics Name to Be Beneficiary CITI'S TAKE Alibaba (covered by Alicia Yap) capex increasing 259% YoY in 3QFY25 and mgmt. comments that total capex in the next 3 years will exceed total capex over the past decade (~Rmb378bn) cemented our constructive view on AI capex up-cycle ahead, yet we also see potential correction after GDS/VNET 100%+ ...

February 21, 2025 01:19 PM GMT US Economics Weekly | North America Another fiscal scramble The deadline is approaching for a potential government shutdown. We expect a shutdown would lead to ~0.1pp per week direct drag on quarterly annualized real GDP growth, but this should reverse once the shutdown ends. The debt ceiling will also be topical for QT. Key Takeaways Exhibit 1: Upcoming fiscal deadlines | Date | Action needed | Votes required | Consequence if not | | --- | --- | --- | --- | | March 14 | Conti ...

21 February 2025 | 7:21AM CST Optical Transceivers: BABA's cloud capex guidance a positive for transceiver demand; Buy HG Tech Alibaba (BABA, covered by Ronald Keung, report link) noted its cloud capex in the coming three years will exceed its total cloud capex in the past decade. This is positive for China datacom optical transceiver makers, in our view. Besides BABA, China telecom operators have also seen an increase in cloud and IDC activities following their deployment of Deepseek on their cloud platfor ...