A-share Evening Highlights | CSRC Releases Multiple Policies to Stabilize the Market and Expectations; Major News Emerges from US-Iran Talks

Evening Highlights of Major News 1. Post-market bombshell: Central bank takes action on Tuesday! What signal is it releasing? Importance: On November 2, the People's Bank of China issued an announcement stating that, in order to support the healthy and stable development of the capital market, the People's Bank of China will conduct swap facility operations for securities, fund, and insurance companies on November 3, with a swap term of 1 year, extendable as appropriate. Currently, 31 securities and fund companies have declared demand, with requested amounts exceeding RMB100 billion. Some analyses pointed out that, as an institutional arrangement, the swap facility will better leverage the role of institutional investors as stabilizers of the capital market. Specifically, the tool design has countercyclical adjustment characteristics. When the stock market falls excessively and stock prices are undervalued, financial institutions have a stronger willingness to buy, and usage of the tool will be relatively large; when the stock market improves and stock liquidity recovers, the necessity of bond swap financing declines, and usage of the tool will naturally decrease. 2. Three departments convene symposium on two tools supporting the capital market Importance: The People's Bank of China, the National Financial Regulatory Administration, and the China Securities Regulatory Commission convened a symposium on the two tools supporting the capital market. The meeting proposed that, in order to maintain capital market stability and enhance market resilience and confidence, the People's Bank of China, the National Financial Regulatory Administration, and the China Securities Regulatory Commission will continue to strengthen policy support, further optimize policy elements and implementation rules, and incentivize financial institutions to make full and effective use of policy tools. They will carry out securities, fund, and insurance company swap facility operations in due course, further increase the number of participating institutions, appropriately lower swap rates, and optimize pledge and operation models. The stock repurchase and increased shareholding relending policy will shift from a phased arrangement to a long-term institutional arrangement, with the relending rate lowered from 1.25% to 1%; financial institutions will adhere to the principle of market-based pricing, reasonably add margins on the basis of the relending rate, and increase loan disbursement. 3. CSRC releases multiple policies to stabilize the market and expectations Importance: On November 2, the CSRC released multiple policies to stabilize the market and expectations in the form of answering reporters' questions, covering two structural monetary policy tools, enriching market investment tools, adjusting and optimizing market-support repurchase rules, and giving play to the countercyclical adjustment of margin trading and securities lending, among other aspects. Regarding the effective use of the two structural monetary policy tools, the CSRC stated that it will work with the People's Bank of China to organize relevant market entities to make full and effective use of these two tools and jointly play a supporting role in stabilizing the market. In terms of enriching market investment tools, the CSRC stated that it will guide and encourage the 18 active ETFs that have completed fundraising to accelerate investment and position-building. In terms of optimizing share repurchase rules, the CSRC stated that it will adjust and optimize market-support repurchase rules and add stock price "below issue price" as one of the circumstances under which market-support repurchases may be conducted. In terms of giving play to the countercyclical adjustment function of margin trading and securities lending, the CSRC stated that it will work with stock exchanges to guide securities companies to conduct coordinated research on risk control indicators such as margin ratios, conversion rates of securities eligible as margin collateral, and maintenance guarantee ratios, further optimize them, and maintain flexibility. 4. Multiple A-share companies plan repurchases and increased shareholdings Importance: On November 2, multiple A-share companies disclosed increased shareholding or repurchase plans. Among them, Sharetronic Data Technology, Xiamen Hongxin Electronics Technology Group Inc., and Hubei Energy Group planned repurchases or increased shareholdings with maximum amounts all exceeding RMB500 million. Among them, Xiamen Hongxin Electronics Technology Group Inc. plans to use its own or self-raised funds to repurchase shares through centralized bidding, with total repurchase funds of no less than RMB300 million and no more than RMB600 million; Han's Laser Technology Industry Group plans to use its own funds to repurchase the company's A-shares through centralized bidding transactions, with the repurchase amount no less than RMB200 million and no more than RMB300 million. 5. After nearly half a year! Moutai share price returns to the 1,400 mark, baijiu sector average price firmly tops the list Importance: On November 2, Kweichow Moutai's closing price was RMB1,439, returning above the 1,400 mark for the first time in half a year. In terms of sector average prices, according to Shenwan Level 2 industry statistics, the baijiu sector ranked first with an average price of RMB112.93, the only sector with an average price above RMB100. Semiconductors, medical aesthetics, automation equipment, communications equipment, electronic chemicals, components, and other sectors followed, with average prices also exceeding RMB50. 6. Multiple popular funds to be suspended for 1 hour on Tuesday Importance: On November 2, multiple popular funds including Invesco Nasdaq Technology ETF, Harvest Nasdaq ETF, China Universal Nasdaq ETF, and Dacheng Nasdaq 100 ETF issued announcements that they would be suspended for 1 hour on Tuesday. According to China Times, multiple public fund managers concentratedly warned of risks on the same day, and some products were even temporarily suspended, indicating that on-exchange prices had significantly deviated from the funds' actual net asset values, and managers had to actively cool overheated sentiment. 7. Hong Kong market bombshell! Derivatives trading to be "extended" Importance: On November 2, HKEX announced two reforms. One is a plan to extend the after-hours trading session for derivatives starting from March 2027. Under the new arrangement, the closing time of the after-hours trading session will be extended from 3:00 a.m. to 4:15 a.m. The other is that HKEX's derivatives clearing house has begun accepting eligible RMB fixed-income assets as non-cash collateral to meet margin requirements. 8. US midterm election battle imminent; local contests to affect the fate of AI computing power Importance: As the voting day for the US midterm elections (November 3) approaches, market attention is shifting more toward struggles in the US political arena. This election will replace all 435 seats in the US House of Representatives and 35 seats in the Senate, and 36 states will also hold gubernatorial elections. For US stock investors, a number of governor and state legislator seats as well as state-level ballot propositions will profoundly affect AI computing infrastructure and the operating environment for tech giants, and deserve special attention. First is Ohio. Ohio currently already hosts Microsoft's planned 8 giant AI data center campus projects for OpenAIa core anchor of AI computing power deployment in the central United States, with Texas in a similar situation. In addition, Pennsylvania, Georgia, and New Mexico also face similar situations. 9. International oil prices continue to plunge! Major news emerges from US-Iran talks Importance: Good news emerged from the Middle East situation, and international oil prices continued to plunge. On the news front, there are signs of easing in the Middle East situation. According to CCTV News, on November 2 local time, Iranian Foreign Ministry spokesman Baghaei said that Rezaei, secretary of Iran's Supreme National Security Council, will decide, based on national interests, how and in what manner to respond to the US letter. Baghaei also said that the main basis for all indirect negotiations between Iran and the United States through mediators is the ("Seven-Day Plan") proposal put forward by Iran. The plan has now been streamlined and can be fully implemented within two days; this flexibility in timing reflects Iran's goodwill and constructive attitude. Opportunities in Advance The editor has sorted through investment opportunities of market interest and found that space computing power and other topics are drawing attention. 1. Musk's blockbuster prediction: orbital computing power will crush ground-based computing power by 2029 Musk predicted that by 2029, AI and cloud computing processing capacity deployed in low Earth orbit will far exceed ground-based computing power. It is reported that SpaceX has applied to build an orbital data center constellation of up to 1 million satellites, operating at altitudes between 500 and 2,000 kilometers, and plans to transmit data in coordination with the Starlink network. A Huafu Securities research report believes that space computing power is the "ultimate" solution in the high-computing-power era, and the 1-N industrialization process is accelerating across the board. Driven jointly by multiple factors such as the explosion in AI computing demand, breakthroughs in reusable rocket technology, and great-power competition, space computing power has entered a window of rapid development and is moving from the early stage of technical verification and policy incubation to the eve of large-scale expansion. "Single-satellite intelligence" already has mature applications, "space-based data, space-based computing" is moving from technical verification to commercialization, and "ground-based data, space-based computing"-ground-coordinated computing architecture is expected to become a long-term development direction. In addition, the following sectors are also worth watching: 2. Artificial intelligence | The National AI Application Pilot Base (Embodied Intelligence) plans to increase capital and expand shares. 3. Carbon neutrality | The "15th Five-Year Plan Implementation Plan for Green Development of Civil Aviation" was issued. 4. Real estate | Shanghai's October second-hand home transaction volume hit a new high for the same period in nearly 6 years. 5. Traditional Chinese medicine | Fujian Province: by 2030, the province's Chinese medicinal herb planting area will reach 1.2 million mu. Positive and Negative Announcements from Listed Companies For positive announcements, the editor reminds readers to watch Sharetronic Data Technology's share increase plan, among others; for negative announcements, note that Fujian Wanchen Food Group is under investigation for information disclosure violations, among others. Positive announcements 1. Sharetronic Data Technology: Controlling shareholder plans to increase shareholding in the company by RMB500 million to RMB1 billion 2. Xingyun Technology: Chairman proposes repurchase of RMB200 million to RMB300 million of shares 3. Far East Smarter Energy: Subsidiary's October winning bids and signed projects totaled approximately RMB1.5 billion Negative announcements 1. Fujian Wanchen Food Group: The CSRC decided to open an investigation into the company on suspicion of information disclosure violations 2. Jiangsu Maixinlin Aviation Science and Technology Corp.: The counterparty to the computing equipment procurement contract breached the contract again, and the company has issued a demand letter 3. Hanma Technology Group: October sales of new energy medium- and heavy-duty trucks fell 18.28% year-on-year This article is reprinted from "Tencent Zixuan Stocks", GMTEight editor: Xu Wenqiang.