On November 12, A-shares rallied then retreated. The Shanghai Composite closed at 3,655.83 points, down 0.67%, the Shenzhen Component Index closed at 11,197.98 points, down 1.68%, and the ChiNext Index closed at 2,509.43 points, down 2.44%, after touching an intraday high of 2,620.25 points with a 4.35% amplitude. The STAR 50 closed at 1,309.84 points, up 0.73%, the only one of the four major indices to finish in the green. Combined turnover for the two markets reached 1.93 trillion yuan, an increase of 255.8 billion yuan in volume, with more than 4,600 individual stocks declining. Gas, cement, livestock farming and semiconductors led the gains, while precious metals, film and cinema chains and coal led the declines. Hong Kong stocks weakened in tandem, with the Hang Seng Index at 24,008.55 points, down 1.26%, and the Hang Seng Tech Index at 3,931.93 points, down 2.36%. Southbound capital bought a net 6 billion Hong Kong dollars against the market trend, while Alibaba fell 6.81% to lead heavyweight decliners. Semiconductor equipment bucked the trend to lead gains, with both price increases and domestic substitution materializing simultaneously.
CSI Semiconductor (related ETF: 561980) topped the list with a 1.92% gain, STAR 50 (related ETF: 588450) rose 0.73%, and STAR Chip Design (related ETF: 589390) gained 0.13%. SanDisk raised NAND contract prices for the third time this year on November 10, by as much as 50%, far exceeding institutional expectations of 5% to 10%. TrendForce indicates that price increases for 12-inch mature process nodes will continue through 2027. Integrated circuit exports rose 137.1% year-on-year in October, with the semiconductor supply chain contributing 14.3 percentage points to total export growth year-on-year, a monthly high since 2022. Domestic share is undergoing a real shift, with ASML's sales share in mainland China falling from 42% in the third quarter of last year to 23%, and Lam Research dropping from 43% to 35%. Naura has already supplied 14nm-class equipment to SMIC, while AMEC has more than 8,800 reaction chambers in mass production across over 220 production lines. Cambricon rose 8.11% to return to 973 yuan.
The Nvidia governance turmoil struck the narrative anchor, and AI application stocks collectively saw valuation cuts. Nvidia fell more than 8% at one point after the bell on Wednesday in the U.S., with reports saying the board is preparing to oust CEO Jensen Huang, and Morgan Stanley subsequently removed it from its "top pick" list. The news fermented during the A-share lunch break, and the AI chain weakened across the board in the afternoon. ChiNext Artificial Intelligence (related ETF: 159243) fell 2.65%, Software (related ETF: 159899) fell 2.56%, Global China Internet (related ETF: 513220) fell 2.38%, Hong Kong Stock Connect Technology (related ETF: 159125) fell 2.20%, Cloud Computing (related ETF: 159890) fell 1.98%, and Hong Kong Stock Connect Information C (related ETF: 526050) fell 1.88%. The A-share AI application sector fell 3.03% and domestic software fell 2.73%, with Shanghai Film hitting the limit down and Huace Film & TV dropping 13.97%. In Hong Kong, Alibaba fell 6.81% and Zhipu dropped more than 9%. Next week, Baidu, Alibaba, NetEase and Tencent will disclose third-quarter results in a concentrated batch.
Physical AI entered a phase of expectation correction, with robotics and commercial aerospace pulling back from highs. Robotics (related ETF: 560770) was the worst performer of the day, down 4.39%. Gaogong Consulting gave its latest estimate on November 3, projecting China's humanoid robot unit shipments this year at more than 50,000, below the earlier forecast of more than 60,000 at the start of the year; after fourth-quarter financing cooled, more than 15% of companies are expected to be eliminated over the next three years. Unitree Technology fell more than 5% in early trading, with its market value falling below 300 billion yuan for the third time. Fulai New Materials hit the limit down and Opt Machine Vision dropped 12.71%. Satellite Industry (related ETF: 159218) fell 2.33% and Commercial Aerospace fell 2.12%, as gains from five consecutive up days were cashed in. Battery (related ETF: 561910) fell 2.49% and Photovoltaic Industry (related ETF: 516230) fell 1.47%. New energy vehicle production and sales rose 13.8% and 13.1% year-on-year in October, and CATL has repurchased shares 17 times since September for a cumulative 5.4 billion yuan. Industry data is not weak, but share prices still adjusted along with the growth style.
Rate hike expectations weighed on precious metals, while food and banks became one of the few safe havens. Nonferrous Mining (related ETF: 159690) fell 3.17%, the second-largest decline of the day. U.S. core CPI rose 0.3% month-on-month in October and headline CPI rose 0.4%, both exceeding expectations, with the market now fully pricing a 25 basis point rate hike in December. The dollar index rose to 102.90, a new high since April 2025, London gold fell below $4,000, and the main Shanghai gold contract dropped 2.07%. In Hong Kong, Zijin Gold International fell more than 10%, Shandong Gold International dropped 9.31% and Chifeng Gold fell 8.32%. On the other side, defensive and consumer names closed higher against the trend. Guozheng Food & Beverage (related ETF: 159843) rose 0.25%, with JD.com's Double 11 liquor transaction value up 25% year-on-year, Moutai up 10% and Wuliangye up 13%, while Huangtai Liquor hit the limit up. Bank AH (related ETF: 517900) rose 0.03%, CSI Livestock (related ETF: 516670) fell 0.02%, and Consumer 80 (related ETF: 510150) fell 0.31%, all with drawdowns significantly smaller than growth-oriented sectors.
On the capital front, small-cap enhanced products attracted more than 73 million yuan in a single day, while cash flow products were bought for a fourth straight day. On-exchange subscription and redemption data showed that CSI 2000 Enhanced ETF (159552) led with net subscriptions of 60.39 million yuan, while CSI 1000 Enhanced ETF (159680) saw net subscriptions of 13.338 million yuan, for a combined total of more than 73.7 million yuan, even as their tracked indices fell 1.83% and 1.97% that day. The large subscriptions during the decline point to institutions adding positions against the trend at style lows. 800 Cash Flow ETF (159119) saw net subscriptions of 2.781 million yuan, its fourth consecutive day of net subscriptions, as defensive cash flow strategies continued to receive steady allocations. Software ETF (159899) saw net subscriptions of 2.628 million yuan and Cloud Computing ETF (159890) saw net subscriptions of 1.485 million yuan, with both AI application chains still attracting incremental capital despite falling nearly 2% to 2.6%. Net inflows were concentrated in small- and mid-cap enhanced products, defensive cash flow and AI applications, indicating equity positions were not withdrawn overall.
What do institutions think? CITIC Securities believes that AI will lift global demand for storage, logic and advanced packaging to a higher order of magnitude, and that the explosiveness and sustainability of semiconductor equipment, materials and components over the next three years have higher visibility. CITIC Securities believes that Hang Seng Tech's current NTM PE is 17.6 times, at the 16.2% percentile over the past five years, and that the Non-GAAP net profit growth of leading internet companies bottomed in the second quarter and is expected to rise 8% and 37% year-on-year in the third and fourth quarters. CICC reminds that Hang Seng Tech's odds are outstanding but its win rate is insufficient, with its dynamic PE falling to 13 times after October 22, already below the level during "924," making it more suitable for structural rebalancing among Hang Seng Tech, technology, cyclicals and dividend plays.
Thinking about the market direction ahead: in the short term, 1.93 trillion yuan in turnover combined with the ChiNext's 4.35% amplitude suggests high-level chips have seen real loosening, and an upward breakout requires new volume to absorb supply. Semiconductor equipment and domestic computing power (related ETFs: 561980, 589390, 588450) were the only direction that day with triple evidence from prices, share and export data, but the CSI Semiconductor Index has already rebounded more than 24% cumulatively since November, with crowding on the high side, so a pullback to around the 10-day moving average is preferable to chasing highs. AI applications (related ETFs: 159243, 159899, 159890) and Hong Kong internet (513220, 159125, 526050) are priced on narrative anchors rather than fundamentals. If the Nvidia turmoil is resolved in the short term and management remains unchanged, the oversold portion has room to recover; if there is a personnel change, the entire chain needs to reassess the pace of capital expenditure, and it is better to wait until then. Physical AI and robotics (related ETF: 560770) are shifting from thematic expectations to shipment validation, and the 50,000-unit estimate, below earlier expectations, will continue to pressure valuations. The pullback in commercial aerospace (related ETF: 159218) is sentiment digestion, and verification of reusable rockets at year-end is a key observation point. Precious metals and resources (related ETFs: 159690, 159197) are pressured by the rising dollar, and it is not advisable to chase a rebound before the December policy meeting concludes. On the defensive side, attention can be paid to food and beverages (related ETF: 159843), banks (related ETF: 517900), livestock farming (related ETF: 516670) and dividend cash flow (related ETFs: 515080, 159119, 159209). Small- and mid-cap enhanced products (related ETFs: 159552, 159680) received the largest net subscriptions and have good sustainability, and their elasticity after style rebalancing is worth tracking. Risk warning: the above content is for reference only and does not constitute any investment advice. Markets carry risks and investment requires caution. MACD golden cross signals have formed, and these stocks are rising well!
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