**Market Overview**

After A-shares breached the 3,900-point mark yesterday, the Shanghai Composite faced resistance today, with typical consolidation at key resistance levels leading to adjustment. Hong Kong stocks also gapped down amid weak US market sentiment, closing down 1.73%.

US markets are facing significant challenges. The Republican-proposed bill to end the US government shutdown failed to secure sufficient votes in the Senate. President Trump indicated plans to cut federal programs favored by Democrats, citing the ongoing congressional deadlock. On the first day of the shutdown, the Trump administration announced a freeze on approximately $18 billion in federal funding for New York City infrastructure projects and cancelled about $8 billion in climate-related funding to Democrat-leaning states. Two days later, $2.1 billion in transportation project funding for Chicago was also suspended. The latest development shows the Trump administration is considering cancelling an additional $12 billion in clean energy project funding.

Adding to market concerns, China's Ministry of Commerce issued two announcements strengthening export controls on rare earth-related items, causing significant unease in the US. The measures are viewed as unprecedented export controls, giving China greater leverage in trade negotiations. Trump threatened that "we import vast amounts from China, perhaps we'll have to stop doing that," though such action seems unlikely given its impact on ordinary citizens.

**Sector Performance**

The primary market concern is the collective decline of recent hot sectors including gold, semiconductors, innovative drugs, energy storage, and robotics. This rapid retreat stems from fears of escalating great power competition tensions.

Fortunately, ZTE Corporation (00763) maintained the technology sector's momentum, mainly driven by upcoming order expectations. Domestic tech giants including ByteDance, Tencent, Alibaba, and Baidu are expected to have combined Capex exceeding 360 billion yuan. China Mobile plans to invest 37.3 billion yuan in computing power in 2025, while China Telecom and China Unicom will increase computing investments by 22% and 28% respectively. The company holds a 21% market share in telecom operator servers, ranking first, with shares rising over 4% today.

The "15th Five-Year Plan" speculation continues in the cement sector. Huaxin Cement (06655) announced plans to grant 2.578 million restricted shares to 11 incentive recipients and repurchase A-shares worth 32.25-64.5 million yuan at prices not exceeding 25 yuan per share. The company plans to rename itself "Huaxin Building Materials," maintaining its current stock code. This incentive plan differs from previous stock options and core employee shareholding plans, focusing on senior management with more diversified assessment indicators. The name change signals the company's evolution from cement to comprehensive building materials, broadening its product portfolio. Shares surged over 9% today. Other cement stocks including Jinyu Group (02009) and Conch Cement (00914) rose over 7% and nearly 3% respectively. CRRC Corporation (01766) also showed resilience.

**Consumer Sector Activity**

The consumer sector was relatively active today. Mixue Group (02097) recently announced acquiring a 53% stake in Xianbeer Fulujia for 297 million yuan, making Mixue the largest shareholder. This move marks Mixue's formal entry into the fresh beer market, offering products priced between 6-10 yuan. Fulujia, an emerging leader in fresh beer, aligns well with Mixue's business model in pricing and store location strategies, promising strong synergies in supply chain, consumer operations, and franchisee resources. Despite limited revenue contribution initially, the synergy potential drove shares up over 4% today.

Nayuki (02150) opened its first US store in New York to massive success, with 100-meter queues wrapping around street corners. The store generated nearly $87,000 (about 620,000 yuan) in revenue over three opening days, selling nearly 13,000 products and setting new opening records for Nayuki stores. If this success can be replicated, it warrants closer attention. Other consumer stocks including Bloock (00325) gained over 8% on new product releases, while Garden Fresh (00999) rose over 6% on strong National Day holiday performance.

**Shipping Sector Surge**

Houthi attacks on commercial ships in the Gulf of Aden escalated in October 2025, driving war risk insurance premiums to 0.7% of vessel value. Some shipping companies were forced to reroute via the Cape of Good Hope, reducing actual Asia-Europe route capacity by 23%. Rerouting adds approximately 10 days and 30% fuel costs, pushing Shanghai-Rotterdam route rates up 12% in a single week. Pacific Basin Shipping (02343) rose steadily.

Oil tanker shipping showed even stronger performance. French naval forces recently seized a Russian "shadow fleet" tanker in international waters. EU sanctions on the "shadow fleet" have removed 444 tankers from mainstream markets, directly benefiting legitimate operators like COSCO SHIPPING Energy (01138). Additionally, China's massive crude oil purchases have created "traffic jams" at ports, making oil tanker rate increases inevitable. COSCO SHIPPING Energy (01138) gained over 5%.

**Insurance Sector**

Financial regulators issued guidance on promoting high-quality development of health insurance, with the market focusing on the restart of dividend-paying long-term health insurance. This allows insurers to design health insurance products with dividend features, providing protection while enabling policyholders to share in insurers' operating results. This significantly benefits insurance companies, with China Taiping (00966) and CPIC (02601) both rising over 3%.

**Individual Stock Highlights**

According to securities regulatory filings, ChangXin Memory Technologies has completed its IPO guidance work. Media reports indicate Dazhong Public Utilities (01635) indirectly holds approximately 0.03856% of ChangXin through Shenzhen Capital Group. The indirect investment relationship drove speculation, with shares rising over 8%.

BLACK SESAME (02533), Chery (09973) commercial vehicles, and CPIC (02601) property insurance recently reached strategic cooperation. The partnership will explore "technology + insurance" innovation models, using advanced driver assistance technology in underwriting processes and creating risk reduction mechanisms linked to premium discounts for new energy commercial vehicles. BLACK SESAME primarily provides PA2.0 commercial vehicle active safety systems for Chery's full range of new energy vehicles, benefiting both BLACK SESAME (02533) and CPIC.

**Sector Focus - Securities**

Bank of America Securities expects mainland brokers' Q3 2025 average net profit to grow 9% quarter-over-quarter and 21% year-over-year, supported by strong brokerage fee growth. Stock trading revenue may exceed expectations, driving overall performance. CICC (03908) and CITIC Securities Construction Investment are expected to lead peers with Q3 net profit growth of 258% and 116% respectively.

The bank raised 2025-2026 earnings forecasts for broker stocks by 0-13%, expecting average earnings growth of 30% for major listed brokers. A-share daily trading volume forecasts were raised 14-18% to 1.6-1.7 trillion yuan for 2025-2026. Ample market liquidity continues supporting market advances, with the Fourth Plenum, 15th Five-Year Plan, and potential regulatory easing as key catalysts.

Preferred stocks include GF SEC (01776), CICC (03908), and CITIC SEC (06030), expected to show strong 2025-2026 earnings growth with improving ROE.

**Individual Stock Deep Dive - BLACK SESAME (02533): Diversification and Second Growth Curve**

H1 2025 revenue rose 40.38% year-over-year to 253 million yuan, hitting a record high, while net profit plunged 169.01% to a net loss of 762 million yuan.

**Analysis:** Intensifying competition in autonomous driving chips led to massive R&D expenses of 618 million yuan in H1 2025, overshadowing record revenue. Revenue growth primarily came from increased sales of driver assistance products and solutions, with A1000 series chips achieving mass production in multiple models including Geely Galaxy E8 and Dongfeng Yipai series, accelerating commercialization.

BLACK SESAME is launching its robotics product line, innovatively integrating high-performance SoC chips, modular hardware, and full-stack software ecosystem with deep ROS/ROS2 compatibility for zero-migration industrial upgrades.

The company has built Huashan and Wudang chip series covering different computing power requirements, achieving breakthroughs from technology to mass production. The Wudang series focuses on cross-domain computing, with the 2023-launched C1200 family including C1236, the first domestic single-chip NOA platform, and C1296, the industry's first multi-domain fusion chip platform.

The Huashan series focuses on driver assistance, with the 2020-launched A1000 chip perfectly suited for L2+/L3 autonomous driving as the first domestic car-grade single-chip platform supporting navigation assistance. The 2024-launched A2000 family fully embraces large models with breakthrough AI computing efficiency, integrating leading CPU, DSP, GPU, NPU, MCU, ISP, and CV units plus the industry's largest NPU core.

Since August this year, the company has intensively expanded into rail transit and robotics, building a "second growth curve." In rail transit, its AI obstacle detection and warning system has gained recognition from leading domestic equipment manufacturers, with expected orders worth tens of millions of dollars. In robotics, it's collaborating with DeepRobotics on embodied intelligence control platforms for humanoid robots and robot dogs, accelerating expansion through capital operations and investments.