〔Day Digest〕Bond Markets Diverge: US 10Y at 4.73% Near Vigilante Zone, China 10Y at 1.69% - BofA Survey Flags Disorderly Rise as #2 Tail Risk, Fed September Odds Slide

0. Weekly Arc

The global bond rout deepened as the US 10Y hovered near 4.73%, approaching Yardeni's 5% "vigilante" zone, while G10 long bonds hit multi-year/decade highs ^[1][2]. Benign July CPI and a Goldman call that a September Fed hike is "very unlikely" failed to stem the selloff ^[3]. In China, the 10Y broke below 1.7% to 1.6964%, a stark divergence ^[4]. The BofA survey captures the tension: "disorderly bond yield rise" is now the second-biggest tail risk (27%), behind the AI bubble (32%) ^[5].

1. Global Bonds and Fed Policy

• **[ESCALATED] Bond vigilantes on alert:** Yardeni Research chief strategist Ed Yardeni says the 10Y at 4.73% is near the upper end of the 4-5% normal range, and "we have not hit the panic button" but are "closely monitoring" vigilantes ^[1].
• **[NEW] Fed hike odds fall:** Goldman Sachs says a September hike is "very unlikely" as inflation cools ^[3]. In the BofA survey, 72% expect no hike before the midterms, and 53% see Warsh neutral at Jackson Hole, with 31% hawkish ^[5].
• **[NEW] G10 debt crisis warnings:** Brookings senior fellow Robin J. Brooks says there is no straightforward way to predict a debt crisis, but market stress is "sharply building" as US, Japanese, UK, and German yields spike ^[2].

2. Positioning and Sentiment

• **[NEW] BofA fund manager survey:** Investors have ramped up stock holdings to the highest in nearly five years, with cash at 3.5% - the sixth-lowest ever ^[5][6]. Both contrarian signals (FMS cash rule and bull-bear indicator) flash "sell" ^[5]. Michael Hartnett's survey also shows "disorderly bond yield rise" as the #2 tail risk ^[5].
• **[NEW] European stocks pricier:** JPMorgan Private Bank's Madison Faller says investors should be more selective as earnings are "increasingly reflected in valuations" ^[7].

3. China: Bonds and Macro

• **[NEW] China bond market:** The 10Y Treasury fell 1.50bp to 1.6964%, and the 30Y sank to a 2.16% low, as the PBOC kept net liquidity injections at zero and rolled over 1tn in reverse repos ^[8][4]. DR001 was stable at 1.36-1.38% ^[8].
• **[NEW] Macro data:** Jan-Jul industrial value-added grew 5.3% y/y, high-tech manufacturing +13.8%, and exports +17.3% ^[9]. July CPI at 0.5% y/y and PPI at 3.5% y/y, both retreating ^[8].
• **[NEW] Digital RMB expansion:** Eight new operators (Ping An Bank, etc.) bring the total to 30 ^[9].

4. Ratings and Company Views

• **[NEW] Goldman on SenseTime:** H1 net profit of 500-700m RMB vs a year-ago loss of 1.5bn, beating expectations; target raised to HK$2.05 from HK$2.00, Neutral ^[10].
• **[NEW] Goldman on Kelun-Biotech:** H1 product sales of 657m RMB (+112% y/y), net profit 388m (including one-off gains), target trimmed to HK$581.2 from HK$582.95, Buy ^[11].
• **[NEW] Morgan Stanley on China AI:** Cloud ROIC of 13-20% with ~3-year payback; Alibaba is most advantaged with a $180 target (+45%) ^[12].
• **[NEW] Yipin initiations:** Aima Technology (603529.SH) and Zijin Mining (601899.SH) receive 5-star ratings, with market caps below intrinsic value ^[13][14].