Zhitong Decision Reference | Pharmaceuticals as the main line will be repeatedly speculated

[Editor’s Market View]

In the first week of June, Hong Kong stocks initially fell and then rose, once again closing with a weekly bullish line.

There is new hope in the China-U.S. negotiations, as Trump stated on Friday that three of his cabinet officials will meet with Chinese representatives in London on Monday to discuss the trade agreement. The U.S. side will be represented by Treasury Secretary Janet Yellen, Commerce Secretary Gina Raimondo, and Trade Representative Katherine Tai. The higher-level U.S. delegation indicates that the negotiations will be more in-depth.

The latest non-farm payrolls exceeded expectations, with an increase of 139,000 jobs in the month, higher than the Dow Jones estimate of 125,000, but lower than the revised 147,000 jobs added in April. Following the release of this non-farm data, the risk of a significant cooling in the labor market has been alleviated, and the CME reflects that overseas markets believe the Federal Reserve is likely to start cutting interest rates in September, with two rate cuts expected this year.

On Monday, the National Bureau of Statistics will release the CPI and PPI data for May. Financial data such as new loans, M2, and social financing for May may also be released this week. On Wednesday, the U.S. will announce the CPI data for May.

The market is primarily focused on the China-U.S. negotiations. If Trump can ease restrictions on high-tech exports or cancel tariffs on fentanyl, it will have a significant stimulating effect on the market. Data conditions will also influence market sentiment.

In the absence of clear market hotspots, pharmaceuticals will continue to be a recurring theme. In other areas, according to informed sources, the U.S. Department of Commerce has notified American nuclear equipment suppliers, including Westinghouse and Emerson, to suspend export licenses for nuclear power equipment to China. The direction of power equipment with independent control will continue to be a topic of speculation.

Pakistan has officially announced the purchase of 40 J-35 fighter jets and Hongqi-19 missiles, and has postponed the repayment of $3.7 billion in debt. The military industry, including aerospace satellites, has seen several catalysts recently.

On June 7, the State Administration of Foreign Exchange released data showing that as of the end of May 2025, the central bank's gold reserves stood at 73.83 million ounces (approximately 2,296.37 tons), an increase of 60,000 ounces month-on-month. Notably, this marks the seventh consecutive month of increases, with a cumulative addition of 1.03 million ounces. There will be opportunities if adjustments are made to gold.

[This Week's Golden Stock]

FYG; FUYAO GLASS (03606)

FYG; FUYAO GLASS is one of the few components in the current automotive industry where the competitive landscape is still optimizing. It does not rely on a single customer or market, making it a hedging variety with a high probability of achieving or exceeding this year's performance targets.

From a volume perspective, it operates in an oligopolistic market, with competitors reducing capacity or exiting, leading to an increase in market share. The automotive glass sector is a typical oligopolistic market, with FUYAO holding a 70% market share in China, 35% in North America (40% in the U.S.), and 25% in Europe. In North America: after the commissioning of the second phase of production capacity at the end of last year, the total capacity reached 7 million sets, and considering the capacity utilization rate corresponding to about 6 million vehicles, the U.S. market share is expected to rise to 50%; in Europe: as competitors like Saint-Gobain exit the market (gradually closing low-profit automotive glass factories from 2024 to 2025), FUYAO's capacity will expand (with an additional 10 million sets of capacity in China by 2025, reaching 46 million sets), actively taking orders from Volkswagen, BMW, etc., leading to an increase in market share in Europe In terms of price, the proportion of high value-added products has increased, and the electrification and intelligence have driven the ASP growth of automotive glass. Currently, the structure of Fuyao's high value-added products includes: panoramic roofs accounting for about 9%, HUDs about 9%, integrated cameras about 7-8%, and double-layer side windows about 5-6%. Traditional glass is about 200 yuan/square meter, functional products like coated glass are about 500 yuan/square meter, and smart glass is about 3,000 to 10,000 yuan/set (1.8 square meters). From electrification to intelligence, the increase in the proportion of Fuyao's high value-added products has driven ASP optimization.

【Industry Observation】

The box office for the Dragon Boat Festival in 2025 reached 460 million yuan, an increase of over 20% compared to the 383 million yuan box office during the Dragon Boat Festival in 2024. The popularity of the summer season is expected to continue, supported by a diverse range of films. So far, a total of 66 films have been scheduled for the summer, including:

"Jiangyuan Alley" will be released on June 21, produced by Maoyan Entertainment and Hengdian Film, with 372,000 people wanting to watch;

"The Lychee of Chang'an" will be released on July 25, produced by Maoyan Entertainment, directed by Da Peng, with 237,000 people wanting to watch;

"Wang Wang Mountain Little Monster" will be released on August 2, mainly invested by Shanghai Film, with 64,000 people wanting to watch;

Imported films include "John Wick: Ballerina" (to be released on June 27), continuing the global IP popularity.

In the Hong Kong stock market, it is recommended to pay attention to the ecological chain leader Maoyan Entertainment (01896) (driven by ticketing + content distribution), as well as Alibaba Pictures (01060) and China Ruyi (00136), which hold quality IP resources.

【Data Monitoring】

According to data released by the Hong Kong Stock Exchange, the total number of open contracts for the Hang Seng Index futures (June) is 112,153, with a net open interest of 45,595 contracts. The settlement date for the Hang Seng Index futures is June 27, 2024.

The Trump tax cut bill has passed the House of Representatives, and the US-China leaders have restarted trade negotiations. At the 23,793-point position, the bear certificate concentration area is close to the central axis, while the bull certificate concentration period is deviating. This week, the Hang Seng Index is bullish.

【Editor's Remarks】

Recently, there have been frequent developments regarding the regulation of stablecoins both domestically and internationally, which has boosted investors' confidence in digital currencies, leading to a renewed gathering of global funds towards related assets. According to data from the Bank for International Settlements, stablecoin issuers have become the third-largest buyers of US short-term government bonds in 2024, and Standard Chartered Bank predicts that by 2028, the issuance of stablecoins will reach 2 trillion US dollars, driven by a demand for 1.6 trillion new US bonds, which is a significant calculation for Americans.

Reflected in the capital market, the investment enthusiasm for stablecoin concept stocks is still rising. However, the popularity of stablecoins is the result of multiple factors working together. The digital currency sector has always been highly volatile, and the "realization ability" behind the thematic speculation still needs time to be tested. In short: whether stablecoins are stable ultimately depends on whether their pegged objects are stable!