〔Day Digest〕End-July Bottom Declared by Haitong's Zhang Yidong: Strategic Bull from August, But No Chasing; CITIC Sees Ultra-Long Crowding as 30Y-10Y Compresses to 47bp - AI Survey Adds to Software Caution

0. Weekly Arc

The dominant China equity call came from Haitong International Chief Economist Zhang Yidong, who said the "summer cold wind" is in its tail-end and that end-July was already a bottom area from a space dimension, while stressing that August is not for chasing highs ^[1]. In rates, CITIC Securities reports that the 30Y-10Y term spread has compressed to about 47bp and fund activity in 10+ year government bonds remains at a high historical percentile, leaving the market exposed to staged pullback risk if absolute long-end yields lack further downward momentum ^[2]. Elsewhere, a Lazard survey shows private equity secondary investors are shifting capital away from software as they await AI disruption clarity, with 91% highlighting proprietary data and network effects as the main moat ^[3]. The immediate catalysts are UK inflation and labour market data plus the July Fed minutes, as previewed by ING Think ^[4].

1. China Equity Outlook

• **[NEW] Haitong International Executive Committee Member and Chief Economist Zhang Yidong:** told The Paper's "Chief Connections" mid-year outlook that while the "summer cold wind" may still have some tail-end and aftermath in time, the space adjustment already completed the bottom in late July ^[1]. He argued the establishment of a new logic is crucial to the autumn market; if such logic is found, the tech bull and AI bull could continue ^[1]. Yet he cautioned that August is unsuitable for chasing rebounds — "strategically can be bullish, tactically need to be down-to-earth to find new logic" ^[1].

2. China Bond Market

• **[NEW] CITIC Securities (research note via Jinshi Data):** the duration-extension trade from Q2 funds continues, but the ultra-long end's risk-reward has changed marginally ^[2]. The 30Y-10Y term spread has been further compressed to about 47bp versus the end of Q2, and fund trading activity in 10+ year government bonds is still at a high historical percentile ^[2]. The report warns that if long-end absolute rates lack further downward momentum, marginal buying from funds and brokers could weaken, raising the risk of a staged pullback after crowded positioning ^[2].

3. AI and Private Equity Software

• **[NEW] Lazard market survey (via Jinshi Data):** private equity secondary investors are reassessing how they evaluate software targets as AI disrupts business models and valuations; many are "shifting capital to other investment opportunities" while awaiting clarity ^[3]. The survey found 91% of respondents see "proprietary data advantages and network effects that AI cannot easily replicate" as the main moat for software firms ^[3]. Only 4% of respondents said their software investment approach had not changed as of June ^[3].

4. Policy and Data Preview

• **[NEW] ING Think:** the weekly preview centers on UK inflation and labour market data plus the July Fed minutes, which will guide near-term rate expectations ^[4]. The alert provides no further detail ^[4].

5. Contrarian Lens: Bubbles as Necessary Cost

• **[NEW] A Huxiu repost of an essay by Sun Liping (original title "Bubbles are a necessary upfront cost of technological revolutions"):** draws on Venezuelan economist Carlota Perez's "Technological Revolutions and Financial Capital" to argue that financial bubbles attached to each technological revolution are not accidental market errors but an unavoidable institutional cost of paradigm shifts ^[5]. The piece says Perez strips the moralizing reading of bubbles, converting the issue from a "human nature problem" to a "structural institutional problem" ^[5]. This framing offers a counterweight to the crowding warnings and PE caution in Sections 2 and 3 ^[2][3][5].