The spillover effects of short selling in U.S. tech stocks have left global markets in a state of uncertainty. Hong Kong's market opened with a gap-down adjustment, closing 0.92% lower for the day. Reports indicate Deutsche Bank is exploring shorting AI-related stocks to hedge risks tied to data center loans, reflecting concerns over AI loan defaults. Meanwhile, OpenAI’s CFO revealed plans to build an ecosystem backed by banks, private funds, and federal government guarantees to finance its massive chip investments—signaling funding shortages and the need for external backing. However, the government has ruled out guarantees, contributing to a 1.9% drop in the Nasdaq overnight. While Hong Kong’s tech sector felt some pressure, the situation differs from U.S. tech firms like OpenAI, which rely on continuous funding. Nvidia remains resilient, but slowing investments and China’s market absence suggest challenges ahead. Without profitable applications, recouping massive AI investments remains uncertain, as seen with SoftBank’s steep declines. In contrast, China’s AI sector, though capital-intensive, shows tangible output and diverse applications, supported by superior 5G/4G infrastructure and a vast population. A new government policy aims to accelerate AI adoption, reinforcing its non-bubble status. Domestic substitution also offers growth potential, lifting stocks like Hua Hong Semiconductor (01347) and SMIC (00981).

Price hikes dominated market themes. Lithium hexafluorophosphate (LiPF6), a key battery material, surged nearly 140% in 3.5 months to ¥120,000/ton, prompting rapid order placements by Gotion High-Tech (002074) and CALB (03931) with Tinci Materials (002709), totaling ~¥40 billion. Lithium iron phosphate prices also rose, with CATL agreeing to a ¥1,000/ton hike, signaling industry-wide margin pressures. Related stocks like Lopal Tech (02465) and Tianqi Lithium (09696) jumped over 7%, while Ganfeng Lithium (01772) and CALB (03931) gained 3%+ on strong earnings.

In solar, polysilicon prices rebounded 50% from July lows to ¥51,000/ton, fueling speculation about industry consolidation. GCL Tech (03800), Xinyi Solar (00968), and Flat Glass (06865) rose over 6%, though sustainability hinges on production discipline.

Tesla shareholders approved Elon Musk’s $1 trillion compensation plan, but shares fell amid dissent. Musk highlighted Optimus robots (targeting $20k/unit production cost) and Cybercab mass production (2026) as growth drivers. Sanhua (02050) dipped slightly due to lack of catalysts.

China’s central bank added gold reserves for the 12th straight month (0.93 tons in October), boosting stocks like Zhou Liu Fu (06168) (+5%) and Zijin Gold (02259).

Military and trade sectors gained as China’s Fujian aircraft carrier entered service, lifting COSCO SHIP HOLD (01919) and Pacific Basin (02343) (+2%). COMEC (00317) surged 4% on a 250% profit jump.

Hainan’s duty-free policies buoyed China Tourism Group Duty Free (01880) (+4%), while caution prevailed in consumer stocks. Bama Tea (06980) tumbled after a post-IPO rally, pressured by weak earnings and a 60% potential float increase from an H-share conversion plan.

**Sector Spotlight**: Coke prices strengthened with a fourth round of hikes (¥50–55/ton), supported by coking coal costs but challenged by weak steel demand. Key players: Kinetic Dev (01277), China Shenhua (01088), China Coal (01898), Yankuang Energy (01171).

**Stock Pick**: Zoomlion (01157) plans a premium H-share convertible bond (up to ¥6B) to fund global expansion. Q3 revenue rose 8.06% YoY to ¥37.2B, with net profit up 24.89%. Overseas sales (57.4% of total) grew 20.8%, driven by European and emerging market expansions. The firm also advanced in humanoid robots (3 prototypes, mass production slated for 2026) and maintains leadership in cranes.