Global stock markets have reached a dangerous edge, with US equities weakening across the board last Friday as the Nasdaq plunged 2.86%. A-shares received timely policy support and managed a modest recovery, while Hong Kong stocks continued to rebound, though the gain was limited at 0.42%.

As the US midterm elections enter their final stage, various chaotic scenes have emerged, with a Michigan Democratic congressman publicly endorsing a Republican opponent, drawing condemnation from party leadership and causing staff resignations; in Alaska, a Democratic campaign team recruited a candidate with the same name to disrupt vote splitting, prompting Justice Department intervention. Trump has slowed his stance to stabilize votes, reportedly wanting to assess whether to resume military strikes on Iran after Tuesday's midterm results, preferring to give diplomacy more time. On Monday, Iran and Qatar resumed negotiations, with both the US and Iran signaling interest in resolving conflicts through diplomatic channels. Brent crude immediately fell about 3%, and the oil price retreat helps ease inflation pressure.

Domestically, after last Friday's sharp decline, the central bank and securities regulator made statements, but these were clearly insufficient. Sure enough, specific measures were introduced over the weekend: the central bank, financial regulatory administration, and securities regulator will hold a meeting on November 2 to study and promote the use of capital market tools and optimize stock buyback and increased holdings relending policies. State-owned major banks plan to add hundred-billion-yuan-level special loan quotas for stock buybacks and increased holdings to China Reform and China Chengtong. After-market catalysts continued: the People's Bank of China is expected to release bidding announcements on November 3 and accept institutional applications. More than 30 securities and fund companies have expressed interest in participating in the bidding, exceeding the scale of the previous two batches of 20 institutions each. Total institutional application demand is expected to exceed 100 billion yuan, already surpassing the scale of the previous two single batches and approaching the combined total of both previous batches. This represents the largest single tool fund in this round of market stabilization liquidity injection.

This is naturally most beneficial for brokerages, as having funds makes everything easier, and buying the dip will enhance performance elasticity. Yunfeng Financial Group Ltd (00376) rose over 10% due to its stablecoin exposure, while China International Capital Corporation Ltd (03908) and GF Securities Co., Ltd. (01776) gained more than 8%. CITIC Securities Co., Ltd. (06030) and China Merchants Securities Co., Ltd. (06099) rose over 5%.

However, it is important to note that whether it is brokerages or enterprises, having money on hand is good, but whether they will actually use it is another matter. If the market stabilizes here without falling further, brokerages will dare to use it; otherwise, if they deploy capital and get trapped, they simply will not dare to use it. The same logic applies to corporate buybacks. Look at the last time in 2024 when the central bank officially announced this policy tool, stating: first phase of 500 billion, and if done well, another 500 billion, or even a third 500 billion. But in reality only 105 billion was used. Therefore, it is important to understand this causal relationship. For now, we might as well "let the bullets fly" and see if the market can truly stabilize. The core remains watching whether technology stocks can stabilize. Today, technology stocks generally recovered, but sustainability needs to be observed. The standout performer was Yangtze Optical Fibre and Cable Joint Stock Limited Company (06869): on October 30 it announced its first three quarters results, with operating revenue of 19.124 billion yuan, up 86.12% year-on-year; net profit attributable to shareholders of 6.128 billion yuan, up 1,204.63% year-on-year. Today it rose over 11%.

Today's market sentiment sector is the AI short drama theme mentioned last Friday. Over the weekend, news emerged that Hongguo Short Drama topped Taiwan's app download rankings, with some people watching until dawn and others canceling Netflix subscriptions. Media reports indicate that about 10 Chinese companies have established overseas short drama platforms, and more than ten overseas short drama apps have launched dedicated AI comic drama channels. iiMedia Research data shows that China's AI micro short dramas are experiencing explosive growth, with the market size reaching 18.98 billion yuan in 2025 and expected to exceed 140 billion yuan by 2030. Overseas markets represent the main battleground for amplifying AI efficiency dividends. Against the backdrop of domestic oversupply, going overseas has shifted from an optional growth engine to a necessity: data shows the overseas micro short drama market reached 4 billion US dollars in 2025 and is expected to exceed 5 billion US dollars in 2026. The AI short drama industry chain has formed a three-layer structure of upstream technology and elements, midstream production and supply, and downstream distribution and monetization. The highest value lies mainly in downstream and upstream, while the midstream production segment faces the fiercest competition with little bargaining power.

The downstream direction undoubtedly captures the most lucrative profits because it controls traffic and settlement rules, possessing scarcity value. Hongguo Short Drama has first-mover advantage, and Tencent Holdings Ltd (00700) is also pushing its WeChat Channels. Other channels include Kuaishou Technology (01024) relying on massive users with lightweight high-paced content, while WeChat Mini Programs, Pinduoduo, and Meituan (03690) enter through scenario-based gateways, forming a complementary distribution ecosystem. Platforms achieve precise content distribution and long-tail monetization through AI recommendation algorithms. Of course, the most profitable is ByteDance Group, which has upstream IP Fanqie, production tool Jimeng Seedance (70-80% share), and downstream Hongguo, forming a perfect closed loop, but unfortunately it is not listed. Tencent Holdings Ltd (00700)'s short drama segment is still small and in the cultivation phase.

Looking at upstream IP, the barriers here are very high, second only to downstream distribution platforms. This relies on long-term accumulation and is equivalent to the source of short dramas. China Literature Ltd (00772), mentioned last Friday, owns the largest online literature IP library in China, proprietary DramaBuddy comic drama AI tools, proprietary Qidian Theater, and overseas ToonScroll comic drama platform, with dual lines of IP licensing and self-produced AI comic dramas. First half short drama and comic drama revenue was 430 million yuan, up 230% year-on-year. Today it rose over 14.33%. Although IP accounts for a relatively small portion of short drama costs, its share of revenue is considerable. Once a hit emerges, the later revenue sharing is the big prize. Today it surged over 15%. China Star Entertainment Ltd (00326) has a classic Hong Kong film IP library that can be adapted for short dramas and comic dramas for secondary development, rising 10% today.

The midstream direction is relatively the lowest in value, with most players earning hard money in a highly competitive red ocean. Duiba Group Ltd (01753) has self-developed AI short drama workflow agents, and its AI short dramas have been profitable for three consecutive months with rapidly rising viewership, having risen significantly earlier. Meanwhile, China Ruyi Holdings Ltd (00136) spans upstream IP, midstream AI production, and downstream proprietary distribution through Pumpkin Film, making it a full-chain play. This was an October Zhitong golden stock, and it was unexpected that it did not move last month and only started now. It is all about timing; too early does not work either. Today it rose over 7%.

In other individual stocks, China Huaxin Cement Co., Ltd. (06655) announced on October 30 that it plans to acquire the equity of the target company Brazil Cement Company held by Brazilian National Steel Company (CSN). The agreement stipulates the enterprise value of the target company at 12.7 billion reais (approximately 15.868 billion yuan at current exchange rates). The company's Q3 net profit attributable to shareholders exceeded market expectations. If the acquisition succeeds, it will boost performance expectations. Today it surged over 10%. Xiaomi Corporation (01810) made new moves, contributing 1.7 billion yuan to subscribe to 898 million yuan of new registered capital in Sunwoda Power, corresponding to a 5.34% stake after the capital increase. After this round of capital increase, Sunwoda Power's valuation is approximately 31.835 billion yuan, making Xiaomi the third largest shareholder. Its latest model, Xiaomi Pengcheng, is fully equipped with Sunwoda Power batteries. Xiaomi YU7 has a one-year value retention rate of 82.3%, ranking first among pure electric models for four consecutive months. Today it rose over 6%.

Sector Focus

According to market news, Chinese robotics company Fourier and META have jointly developed a humanoid robot prototype called Max. The two parties took only about three months, and second-generation product development has already begun. Reports indicate this robot is approximately 1.5 meters tall and weighs about 48 kilograms, equipped with NVIDIA Jetson Thor chips, a display capable of simulating facial expressions, speakers, and five-fingered dexterous hands that can grasp small objects. This signifies a new paradigm in robotics: overseas giants handle large models and intelligent agent brains, while domestic robot manufacturers handle the complete machine body, motion engineering, and dexterous interaction hardware foundation. Producing a prototype in three months proves this division of labor model is far more efficient than a single company developing the entire machine from scratch. Related Hong Kong stocks include Horizon Robotics (09660), Woan Technology (06600), Dobot (02432), Xianjiang Intelligent (06106), and UBTECH Robotics (09880).

Individual Stock Deep Dive

China International Marine Containers (Group) Co., Ltd. (02039): Expanding energy storage, signing new drilling service contracts, ample order backlog continuously improving profitability. On October 30 it announced that it plans to contribute 298.83 million yuan through subsidiary CIMC Capital Holdings to participate in establishing a new energy storage industry fund with a subscribed scale of 1 billion yuan, accounting for 29.88%, expanding into the electrochemical energy storage industry chain. Its subsidiary CIMC Offshore signed a drilling service contract with an international client for the semi-submersible platform "Beacon Pacific."

Commentary: The company is expanding its energy storage industry chain layout, which is a long-term industrial incubation arrangement. The semi-submersible platform "Beacon Pacific" drilling service contract proves that CIMC Offshore's platform asset leasing capability continues to be realized. The company's Q3 single-quarter profit rebounded explosively, validating that high-margin offshore engineering orders are entering a concentrated delivery period. The company is a global leader across multiple tracks, ranking first globally in dry containers, reefer containers, special containers, tank containers, and semi-trailers; it is a core global supplier of boarding bridges; its offshore engineering segment (Raffles) is one of the few domestic enterprises with dual general contracting EPC capabilities for FPSO and FLNG, representing scarce domestic high-end floating equipment capacity.

Full industry chain plus global manufacturing layout. With production bases in nearly 20 countries worldwide, domestic and overseas revenue is nearly split evenly, diversifying single-region trade policy risks. It covers equipment manufacturing, engineering general contracting, asset operations, and logistics services, not merely contract manufacturing, possessing integrated equipment plus operations capabilities. Offshore engineering (Raffles) is the company's biggest highlight, with offshore engineering gross margin rising to around 20%, offering the greatest profit elasticity. Order backlog exceeds 10 billion US dollars, with 5.7 billion US dollars in new orders in the first three quarters, with oil and gas versus non-oil and gas at approximately 6:4, including large FPSO and FLNG general contracting projects. Production cycles are long, order quality is high, gross margins have risen significantly, delivery efficiency has improved, and first half 2026 net profit was up 155.5% year-on-year. Q3 continues to deliver, with large FLNG and FPSO high-margin projects gradually being delivered. This is the source of profit elasticity in this cycle and the strongest current growth theme.

Energy and chemical equipment (Enric) is growing steadily, with stable revenue and steadily rising profits. Order backlog is 33.381 billion yuan, up 8.5% year-on-year. New orders in the first three quarters were 21.937 billion yuan, up 11.7% year-on-year, supported by LNG, hydrogen energy, and industrial storage and transportation demand, representing long-term growth. The container segment has no long-term large general contracting order backlog and belongs to short-cycle rolling orders. In the first three quarters of 2026, dry container sales were 2.055 million TEU (up 14.05%) and reefer container sales were 152,600 TEU. Reefer containers benefit from fresh cold chain demand, with better prosperity than ordinary dry containers. The company's energy and offshore engineering segments have thick order reserves with production scheduling extending for years, and long-cycle large general contracting orders continue to land, opening up valuation space.