Market Review
Recently (from 2024/02/11 to 2024/02/28), major global stock indices all posted positive gains, with Chinese concept stocks experiencing a strong rebound, and AI-related stocks breaking new highs following Nvidia's better-than-expected financial report. US bond assets performed weakly, mainly due to January inflation data surpassing expectations, forcing the market to revise interest rate cut expectations once again. The US dollar index remained relatively stable, while the Japanese yen depreciated significantly.
Tiger Select 1：

Sora ignites a new wave of AI, demanding computational power.

⭐Explanation 1：Recently, OpenAI released the text-to-video large model Sora, with its high video quality and smooth visuals, achieving a technological breakthrough in AI text-to-video synthesis, instantly sparking global discussion. Beyond text, AI's understanding of the world has been expanded, opening up the imaginative space of "world models."

⭐Explanation 2：From a chip perspective, the closer the "world model" is to reality, the more accurate the physical logic and comprehensive information it requires. The scale of computational power, storage, and network demand will be much larger than text models, further benefiting the AI chip industry, including Nvidia and memory chip manufacturers.

⭐Explanation 3：The emergence of new modal large models has also sparked people's imagination about future applications. Sora's application scenarios are broader than ChatGPT, with more significant commercial value, driving changes in production processes across multiple fields such as gaming, art, film, and XR.

❤️Reason：As the development of large models continues, computational power as the infrastructure of AI has vast demand potential. We are optimistic about the development prospects of the AI semiconductor sector. Additionally, new technologies will make content production for virtual reality more cost-effective and efficient, effectively addressing the issue of insufficient content richness in products like XR. We are bullish on the long-term development of related terminal manufacturers.

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Tiger Select 2：

US bond yields return to a reasonable range, highlighting opportunities for long-term bond allocations.

⭐Explanation 1：Since the end of December, inflation data has consistently exceeded expectations, while the Federal Reserve indicated in its January FOMC meeting that the conditions for rate cuts were not yet sufficient, leading to continuous disappointment in the market's rate cut expectations and forcing a revision in rate cut pricing. The 10-year US Treasury bond yield has risen to 4.32%.

⭐Explanation 2：However, looking at the details, core inflation remains under control, and interest rates are essentially peaking. The main reason for January's inflation exceeding expectations is a distortion in the sub-item of rent (OER). The seasonal adjustment calculation method for OER amplified the rebound in the housing market. According to data from third-party rental platforms, rents in January did not rise significantly. After excluding rent from core CPI, the inflation rate remained relatively stable. Most Federal Reserve officials also believe that the risk of further inflation escalation is low, and the current policy rate has essentially reached the peak of this tightening cycle.

⭐Explanation 3：Looking ahead, the path for Fed rate cuts is relatively clear: persistent high rates will further suppress labor demand, slow down the job market, and weaken the support for inflation. Under the attenuation of inflation resilience, it may gradually fall back into the Fed's target range, thus initiating a rate-cutting cycle for the Fed, only a matter of time.

❤️Reason：Therefore, against the backdrop of interest rate peaking and a clear path for rate cuts, with the current market pricing in three rate cuts by the Fed this year and US bond yields already rising above a reasonable central level, we recommend investment opportunities in medium to long-term US bonds.

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Market Review
Recent developments, including statements from Federal Reserve officials and the unexpected growth of the U.S. Consumer Price Index (CPI) in December, suggest resilience in the "last 1%" of declining inflation. There is an element of overtrading in market expectations for interest rate cuts, leading to increased volatility. In the past two weeks, the yield on 10-year U.S. Treasury bonds rose by 20 basis points, impacting global bond assets. While the three major U.S. stock indices experienced fluctuations, the healthcare sector outperformed, making it an attractive investment amid market uncertainty.
Tiger Select 1：

AI terminal products is the focus of this year Consumer Electronics Show (CES).

⭐Explanation 1：At this year's CES, manufacturers including Microsoft, HP, Asus, and others debutted their AI PC products. Multiple products offer a dedicated startup button for Windows 11 Copilot, and various AI applications such as AI assistants, text-to-image, and digital avatars are being launched. Additionally, these AI PC devices are integrated with advanced components from NVIDIA or Intel, significantly enhancing the processing capabilities. This marks a discernible trend of AI integration into terminals.

⭐Explanation 2：Moreover, at CES, various manufacturers highlighted advancements in vehicle intelligence. Volkswagen incorporated ChatGPT's IDA voice assistant, while Magna's eDrive product showcased integrated Advanced Driver Assistance Systems (ADAS) capabilities. NVIDIA revealed at CES that Ideal will use the "Drive Thor" intelligent driving platform in future models. Intel and AMD also entered the intelligent cockpit and driving chip market, signaling a pronounced trend of integration between automotive technology and artificial intelligence, cloud computing, and other related fields.

⭐Explanation 3：In the realm of AR/VR, companies like Sony, Hisense, and BOE have unveiled their latest products. The anticipated launch of Apple's VisionPro might set industry standards, and as the VR ecosystem improves, it is likely to draw more manufacturers into this burgeoning field.

❤️Reason：With the gradual penetration of AI into terminals, both AI PCs and AI in vehicles will provide new momentum for the development of the AI field. At the same time, the release of Apple's VR is expected to usher in a new wave of industry trends.

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Tiger Select 2：

AI terminal products is the focus of this year Consumer Electronics Show (CES).

⭐Explanation 1：At this year's CES, manufacturers including Microsoft, HP, Asus, and others debutted their AI PC products. Multiple products offer a dedicated startup button for Windows 11 Copilot, and various AI applications such as AI assistants, text-to-image, and digital avatars are being launched. Additionally, these AI PC devices are integrated with advanced components from NVIDIA or Intel, significantly enhancing the processing capabilities. This marks a discernible trend of AI integration into terminals.

⭐Explanation 2：Moreover, at CES, various manufacturers highlighted advancements in vehicle intelligence. Volkswagen incorporated ChatGPT's IDA voice assistant, while Magna's eDrive product showcased integrated Advanced Driver Assistance Systems (ADAS) capabilities. NVIDIA revealed at CES that Ideal will use the "Drive Thor" intelligent driving platform in future models. Intel and AMD also entered the intelligent cockpit and driving chip market, signaling a pronounced trend of integration between automotive technology and artificial intelligence, cloud computing, and other related fields.

⭐Explanation 3：In the realm of AR/VR, companies like Sony, Hisense, and BOE have unveiled their latest products. The anticipated launch of Apple's VisionPro might set industry standards, and as the VR ecosystem improves, it is likely to draw more manufacturers into this burgeoning field.

❤️Reason：With the gradual penetration of AI into terminals, both AI PCs and AI in vehicles will provide new momentum for the development of the AI field. At the same time, the release of Apple's VR is expected to usher in a new wave of industry trends.

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