July 5th Macroeconomic Index: China PV Industry Focuses on Financial Risk, AI Standards to Boost Industry Growth

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Domestic News

1. China Photovoltaic Industry Association organized a special meeting on financial risk assessment of the photovoltaic industry and the construction of the industry's financial ecology

2. The Ministry of Industry and Information Technology and other three departments issued the "Guidelines for the Construction of a Comprehensive Standardization System for the National Artificial Intelligence Industry (2024 Edition)"

3. The progress of completing the sales target of automobile companies is not good

4. In June, the monthly average profit of self-breeding and self-raising pig was at the highest level this year

5. Sinopec: It obtained high-yield oil and gas wells in the Beibu Gulf Basin

International News

1. Italy's service sector grew for the sixth consecutive month in June

2. Economists: German service sector activity continues to expand at a steady pace

3. The British service sector slowed down before the election, and PMI data showed that GDP growth expectations are still optimistic

4. Agency: Oil demand is expected to weaken in 2025

5. The sharp increase in zinc production by Russian enterprises is aimed at meeting growing domestic demand

Domestic News

1. China Photovoltaic Industry Association organized a special meeting on financial risk assessment of the photovoltaic industry and the construction of the industry's financial ecology

The China Photovoltaic Industry Association organized a special meeting on financial risk assessment and industry financial ecological construction in Beijing. The participants agreed that the fluctuations caused by the current stage of supply and demand mismatch in the industry have not changed the long-term trend of industry development; This round of industry fluctuations, in addition to testing the financial indicators and capabilities of enterprises, is also a test of the strategic vision and professional ability of entrepreneurs and management teams, the innovation ability represented by patents and R&D investment, and the ability of enterprises to refine and low-cost management. All parties should actively respond to the phased difficulties, strengthen communication and cooperation among enterprises, enterprises and financial institutions, make information transparent, enhance mutual trust, coordinate to resolve financial risks, and jointly maintain a healthy investment and financing environment.

2. The Ministry of Industry and Information Technology and other three departments issued the "Guidelines for the Construction of a Comprehensive Standardization System for the National Artificial Intelligence Industry (2024 Edition)"

The Ministry of Industry and Information Technology and other four departments issued the "Guidelines for the Construction of a Comprehensive Standardization System for the National Artificial Intelligence Industry (2024 Edition)", mentioning that by 2026, the linkage level of standards and industrial scientific and technological innovation will continue to improve, and more than 50 new national standards and industry standards will be formulated, leading the high-quality development of the artificial intelligence industry. The standard system will be accelerated. There are more than 1,000 enterprises that have carried out the publicity, implementation and promotion of standards, and the results of the innovation and development of standard service enterprises have become more prominent. Participated in the formulation of more than 20 international standards to promote the global development of the artificial intelligence industry. According to the data, the number of artificial intelligence enterprises in China has exceeded 4,000, and in 2023, the scale of China's artificial intelligence core industries reached 578.4 billion yuan, with a growth rate of 13.9%.

3. The progress of completing the sales target of automobile companies is not good

Boosted by factors such as the trade-in policy, a number of new energy vehicle brands achieved the best monthly sales results this year in June. BYD and Geely Automobile have completed more than 40% of their annual sales targets, Li Auto and ZEEKR Automobile have completed more than 30% of their annual sales targets, and Xpeng Motors has completed less than 20% of their annual sales targets. Overall, the sales target of automobile companies is not progressing well.

4. In June, the monthly average profit of self-breeding and self-raising pig was at the highest level this year

In the first half of the year, the domestic pig slaughter price has risen from the lowest less than 14 yuan/kg to about 18 yuan/kg at present. In June, the profit of self-raising pig was consolidated at a higher level, the feed fluctuation in the month was small, and the pig price rose greatly, and the two worked together to make the monthly average profit of self-raising pig in June at the highest level this year.

5. Sinopec: It obtained high-yield oil and gas wells in the Beibu Gulf Basin

According to the press office of Sinopec, Sinopec deployed in the Weixi exploration area of the Beibu Gulf Basin in the South China Sea to test the high-yield industrial oil and gas flow, which is converted into a daily output of 738 cubic meters of crude oil, 280,000 cubic meters of natural gas, and 1,010 cubic meters of oil and gas equivalent, setting a record for the highest daily oil and gas production in the Beibu Gulf depression. The breakthrough of this well confirms the further exploration and development potential of Weixi Exploration Area, and provides strong support for Weizhou Oilfield to further expand the scale of reserve increase and production. (Securities Times)

International News

1. Italy's service sector grew for the sixth consecutive month in June

Italy's services sector expanded for the sixth straight month in June, albeit at a slower pace than the previous month, a survey showed on Wednesday. This is due to the continued growth of new business in the eurozone's third-largest economy. Italy's services PMI came in at 53.7 in June, down from 54.2 in May but still well above the 50 cut-off line. HCOB economist Tariq Kamal Chaudhry said that despite a slight decline compared to the previous month, the index of business activity in the services sector remained strong. In stark contrast to service providers, Italy's PMI for small-scale manufacturing contracted for the third consecutive month in June. The composite PMI fell to 51.3 from 52.3 in May, the lowest level since February, but remained above the 50 threshold for the sixth consecutive month.

2. Economists: German service sector activity continues to expand at a steady pace

Dr. Cyrus de la Rubia, chief economist at Commerzbank Hamburg, said that the service sector is the backbone of the German economy. Despite a slight weakening of momentum, service sector activity continues to expand at a solid pace. Despite being more cautious than in May, businesses are still hiring. After remaining largely unchanged over the past two months, the decline in backlog is a bit worrying. We tend not to over-read this data, as the slowdown in consumer price inflation and higher wage agreements are supporting people's purchasing power. In addition, according to some respondents, the European Football Championship, which has already had a positive impact, will enter a "hot phase" in July. Against this backdrop, new export businesses, including tourism, have been on the rise since May. Therefore, we are optimistic that the services sector will continue to grow.

3. The British service sector slowed down before the election, and PMI data showed that GDP growth expectations are still optimistic

Joe Hayes, chief economist at S&P Global Market Intelligence, said we are seeing some signs of stagnation in the UK services sector ahead of the election, with business activity growth slowing to a seven-month low in June as the prospect of a change of government has led some businesses to take a 'wait-and-see' approach, dampening sales. Still, based on the composite PMI data for the three months to June, we are still on track for another quarter of GDP growth, although the pace will not be as strong as the 0.7% growth in Q1. Prices in the UK services sector as a whole remain highly sticky, despite input cost inflation falling again in June.

4. Agency: Oil demand is expected to weaken in 2025

Oil demand is expected to soften next year due to oversupply driven by non-OPEC countries, analysts at BMI, a research arm owned by Fitch, said. Oil production from non-OPEC countries, excluding the United States, will grow at an average rate of 858,000 b/d this year this year and 940,000 b/d next year, higher than in any two years since 2005, according to the research firm. BMI expects Brent crude to fall to $82 a barrel next year, but said it is considering lowering its estimate.

5. The sharp increase in zinc production by Russian enterprises is aimed at meeting growing domestic demand

Russian companies have increased zinc metal production over the past month to benefit from rising national demand and reduce dependence on raw material destinations, two people familiar with the matter said. Russia produces only a small proportion of the world's zinc production for galvanized steel, but it will exacerbate the tightness of the global zinc concentrate ore market. CRU analyst Tom Rutland said Russia will be able to produce 322,000 tonnes of refined zinc from the Chelyabinsk and Verkhny Ufaley smelters by 2027, up from 205,000 tonnes last year.

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