The world can be bafflingly surreal. Yesterday it was all celebration; today it is a raging storm. Overnight, the Nasdaq lost $2.3 trillion in value, the Philadelphia Semiconductor Index fell 12%, Nvidia dropped 9%, SanDisk plunged 22%, Micron Technology sank 17%, and AMD tumbled 17%. Asia-Pacific was the hardest-hit region: South Korea's stock market triggered a circuit breaker with the KOSPI plummeting over 6%, and Japan's Nikkei 225 plunged nearly 6%. A-shares declined more modestly, with the Shanghai Composite falling just over 1%, while Hong Kong stocks dropped 1.27%.
The source of the storm was a post published on X on November 4 by Yassamin Ansari. Her message: on the first day the new Democratic-majority House takes office, the top agenda item would be to pause advanced AI development, regulate out-of-control industries, and ban superintelligence ASI. She explicitly tied this to a bill drafted by Sanders several months earlier whose contents are quite chilling, which we will not reproduce here. Combined with the fact that Democratic-won states are all banning data center construction, this bearish catalyst was amplified to the extreme. Then the U.S. stock market stampede unfolded.
Objectively speaking, this is wildly exaggerated. The so-called bills the Democrats pushed back then were merely weapons against the Republicans, driven more by political necessity: whatever the Republicans support, the Democrats must oppose. That is the essence of the problem. Now that the Democrats are in power, the script may not play out the same way. Moreover, the Democrats are not mindlessly opposing AI; they want stronger regulation and orderly development, with an eye toward not disrupting people's livelihoods. After all, without AI, what would be left of the U.S. stock market? How would the economy develop? AI is a must-win battleground, and that is a consensus of both parties. Another point: the reckoning against Musk may not be as dramatic as feared. Democratic Governor-elect of Texas Gina Hinojosa has already indicated that Texas can build a strong working relationship with Musk and his companies, but only on her administration's terms. Therefore, this U.S. stock market crash has an element of people seizing on a pretext. It has gone beyond the AI issue itself and is laced with political undertones.
Trump fired directly on social media: "The U.S. stock market experienced one of the worst trading days in history because of the election results. It is heartbreaking to witness such a sad spectacle! We worked so hard to reach unprecedented heights, only to suffer this kind of blow. As a result, your 401(k) account value has shrunk accordingly. Remember, the responsibility lies not with the Republicans but with the Democrats. However, do not worry, no matter what, we will ultimately become stronger than ever before." The subtext: you chose the Democrats, and this is what you get; whenever the Republicans win, the stock market rises. No wonder he was unusually calm after the midterm elections. He was waiting here all along. Wall Street is professional. Do not look at the declines and assume heavy losses. They have short-selling mechanisms, and they can profit by shorting even during a crash. Everyone has their own vulnerabilities, but it all comes down to an exchange of interests. One thing is certain: this mutual fighting between the two parties generates enormous destructive force at its core, and instability will certainly be the norm. The Democrats are already taking action. A federal district judge issued a 14-day temporary restraining order on November 5 to block the Trump administration from breaking ground on a "triumphal arch" in Washington, D.C. More moves will follow.
Reflecting back on Hong Kong stocks, technology shares naturally fell sharply, but some held firm. HUA HONG GRACE (ASX: 01347) reported record third-quarter revenue of $987 million, up 19.9% year-on-year, including the newly consolidated Huali Microelectronics. On a standalone basis, revenue reached $803 million, above market guidance. The key driver was the self-controllable theme, and the stock rose over 4% today. What can hold up are livelihood-oriented sectors. In healthcare, 160 HEALTH (ASX: 02656) officially launched its "Medical Care in China" business during the China International Import Expo, offering international patients one-stop services for coming to China for medical treatment, including matching patients with hospitals and doctors, arranging appointments and itineraries, assisting with visas, providing interpretation and treatment coordination upon arrival, and follow-up after returning home. This is indeed a good project that can also drive tourism and consumption.
An active performer is 160 HEALTH (ASX: 02656), which focuses on medical services, providing AI pre-diagnosis, AI triage, and full-course operation revenue sharing for top-tier hospitals. Its digital medical solutions carry very high gross margins (over 70%), and the number of partner top-tier hospitals continues to grow, with the market benchmarking it against vertical medical AI platforms. After experiencing its first post-listing lock-up expiry window in September this year, the share price fell steadily, but after October 29, the situation changed. Barclays PLC increased its holdings by 24.182 million shares at approximately HK$3.18 per share, for a total of approximately HK$76.93 million, bringing its latest holding to 28.8435 million shares, or an 8.31% stake. The reason for the large increase is the company's foray into AI computing power. A HK$650 million computing power framework agreement was announced in September, and a HK$42 million first computing power equipment contract was signed in October. However, note that the above are only intent purchase orders from intermediaries or partners. Only orders that ultimately reach terminal pharmaceutical use are real. After all, the buyer itself is in the computing power business and has no need to go through 160 HEALTH to make a purchase; it simply values 160 HEALTH's resources in pharmaceutical cooperation to facilitate joint bidding. For now, it is best to observe more. Only when hospitals actually adopt the solutions can the replication story be told. The stock rose over 13% today. Others like Hygeia Healthcare (ASX: 06078) gained nearly 5%.
The power sector is also very stable. Ge Ju, Deputy Director of the Development Planning Department of the National Energy Administration, stated that during the "15th Five-Year Plan" period, driven by emerging industries such as computing power, China's electricity demand will continue to grow rigidly, with an expected average annual increase of about 600 billion kWh, equivalent to adding three Shanghai's worth of electricity consumption each year. To ensure adequate power supply, a power supply adequacy warning mechanism has been established, proposing that by 2030 the power supply adequacy ratio should exceed 1.1, meaning that even at peak load, there would still be a 10% supply buffer to ensure the ability to "ride out the peak and hold the bottom" at critical moments. Thermal power companies in particular benefit from policy support. A subsidy policy was mentioned a couple of days ago, and the strong performers are Huaneng Power International (ASX: 00902) and Huadian Power International (ASX: 01071), both up over 3%. Waste-to-energy also enjoys strong policy support. Zhitong's November pick EB ENVIRONMENT (ASX: 00257) rose over 2%.
In other livelihood-oriented sectors, COFCO Joycome (ASX: 01610) operates four businesses in parallel: hog farming, slaughtering and processing, branded chilled meat, and the nation's second-largest meat import and distribution business (beef/pork imports). This multi-segment hedging means it is not simply betting on hog prices; whether prices rise or fall, it can make money. The stock rose over 5% today. Then there are domestic-brand apparel names. Li Ning (ASX: 02331) announced on November 5 a special dividend of RMB 2.32 per share, equivalent to HK$2.71 per share at an exchange rate of 1 RMB to 1.168 HKD. Based on approximately 2.585 billion issued shares, the total special dividend amounts to about RMB 6 billion. Note the ex-dividend date is November 18, the record date is November 23, and payment will be made on December 1. The company will suspend share transfer registration from November 20 to November 23. Companies that can pay dividends these days are indeed rare, and the stock rose over 5%. Against the broader backdrop of Adidas and others losing market share while still clearing inventory, Li Ning has completed its inventory clearance ahead of them and is expected to continue eroding their share.
At 21:30 Beijing time on Friday, the U.S. will release the October nonfarm payrolls report. With technology stocks having suffered a historic crash, market attention on this report will be extremely high. The market expects U.S. October job growth to recover slightly from September but remain weak. The consensus is that U.S. October nonfarm payrolls will show only 59,000 new jobs, up from 29,000 in September, and the U.S. October unemployment rate will remain at the very low level of 4.2%. In short, a slightly weak reading is fine since the stock market is already in this state; if it comes in stronger, things will be even harder. With U.S. stocks in freefall, if they do not recover, the situation is very dangerous. Watch how strong the rebound is. In U.S. pre-market trading: AI hardware stocks rebounded collectively, SanDisk rose nearly 8%, and semiconductor equipment stocks led gains. With the market falling, domestic brokerages have also accelerated their entry. Guotai Haitong completed its first batch of stock purchases under the third tranche of the swap facility, CICC bought stocks today under the third tranche of the "Securities, Fund, and Insurance Company Swap Facility," and Galaxy Securities completed its first batch of A-share purchase operations. Incremental funds from the swap facility are entering the market at a faster pace. When prices fall enough, institutions will step in.
Sector Focus
On the afternoon of November 6, more than 10 Shenzhen-listed companies collectively announced plans to use buyback and shareholding increase loans, including Zhongji Innolight, Tianfu Communication, Eoptolink, Victory Giant Technology, Han's Laser, Luxshare Precision, Dongshan Precision, Avary Holding, Sanhuan Group, and Robotech, covering core hard-tech tracks such as optical modules, PCB, consumer electronics, and laser equipment. On November 2, a CSRC official responding to reporters on stabilizing the market and expectations mentioned that the stock buyback and shareholding increase relending policy has shifted from a phased arrangement to a long-term institutional arrangement, with the relending rate lowered to 1%. Policy tool usage remains hot. Since October, Shenzhen-listed companies have disclosed 8 announcements on the use of buyback and shareholding increase loans, with loan amounts of RMB 2.452 billion. As of November 5, Shenzhen-listed companies have disclosed over 560 new special loan announcements for buybacks and shareholding increases, with loan amounts exceeding RMB 120 billion. If U.S. stocks rebound, the above names are expected to follow suit, given how hard they have fallen. But be careful if the opposite happens.
Stock Spotlight
EB ENVIRONMENT (ASX: 00257): Operating revenue share continues to rise, heating revenue growth stands out. EB Environment partnered with China Construction Third Engineering Bureau and Guangzhou Huake to invest approximately RMB 2.252 billion to build the Dongguan Environmental Thermal Power Plant. In H1 2026, the company achieved operating revenue of HK$14.181 billion, down 1% year-on-year, and net profit attributable to shareholders of HK$2.431 billion, up 10% year-on-year. The company declared an interim dividend of 16.0 HK cents per share for 2026, an increase from 15.0 HK cents per share in the same period of 2025. Comment: EB Environment is a domestic leader in solid waste incineration, having topped the list of China's top ten solid waste companies for many consecutive years, with projects covering 24 provinces and 228 cities and counties. The company has a complete set of self-developed equipment plus process barriers, including proprietary grate furnaces, flue gas purification, and leachate treatment technologies, with domestically produced 750/1,000-ton large-scale incinerators; its micro small-scale furnaces are internationally leading, suitable for county-level, island, and overseas small-volume markets; its power battery recycling equipment has been included in the national major environmental protection equipment catalog; and it has led multiple national solid waste standards. In H1 2026, heating revenue growth was impressive, representing a second growth curve. The company's operating service revenue reached HK$10.755 billion, up 8% year-on-year, rising to 76% of total revenue. Key new domestic wins include Dongguan Southeast Thermal Power: 3,000 tons/day of domestic waste plus supporting kitchen waste, BOOT, 31-year concession period, Phase I investment of RMB 2.252 billion, one of the largest single waste incineration projects in China recently, forming a dual-base presence in Dongguan alongside the existing Machong project. Qinghai Guide: 200 tons/day county-level incineration EPC+O, RMB 203.6 million, a benchmark micro-furnace project covering multiple counties in southern Qinghai. Key overseas projects: Uzbekistan's Namangan and Fergana: 1,500 tons/day each, total investment of approximately RMB 3 billion, under construction, expected to commence production in 2027, a core Central Asian benchmark. Indonesia's Bekasi at 1,400 tons/day and Vietnam's Thanh Hoa at 1,000 tons/day are priority cooperation/pre-award projects, marking a return to Vietnam and entry into the Indonesian market. Multiple EPC equipment orders in the Philippines, and O&M and equipment orders in Singapore and Seychelles, with asset-light contracts continuing to land. The company's operating revenue share continues to rise, and as project operations improve in quality and efficiency, cash flow is expected to continue improving. The company stated that building the Dongguan Environmental Thermal Power Plant project will enhance the scale of its solid waste treatment and clean energy businesses, bringing stable returns to the company and its shareholders.
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