On the previous trading day (October 28), the Shanghai Composite Index rose 0.91% to 3,681.47 points, the Shenzhen Component Index gained 2.02% to 11,473.18 points, and the ChiNext Index climbed 3.40% to 2,634.76 points; combined turnover across the two markets reached 2.08 trillion yuan; 4,156 stocks advanced, 1,239 declined, 181 were flat, 67 hit the daily limit up, and 1 hit the daily limit down.
CITIC Securities believes the Fed's decision to hold rates steady in October, along with a more cautious policy stance in its statement, still points to another 25bps hike in December; Guosheng Securities notes that active equity fund stock positions declined in the third quarter, with pharmaceuticals receiving the largest active additions; Guotou Securities argues the central bank's BNSF tool helps break the negative feedback loop of redemption-driven selling and is moderately positive for the bond market over the medium to long term; Huafu Securities observes that competition in physical AI is extending toward a systematic, full-chain approach, with data collection becoming a critical link; Sinolink Securities finds that AI drug discovery can compress R&D cycles by 50-90%, offering broad industry space.
CITIC Securities: Fed's Mild October Pause with More Cautious Guidance, Another 25bps Hike Possible in December
The Fed held rates steady in October as expected, with statement language more optimistic on the pace of economic expansion but more cautious in its policy stance guidance; post-meeting remarks were more dovish than in September, mentioning that credit conditions have tightened, inflation expectations are moving in the right direction, and previewing adjustments to the FOMC meeting schedule for the next two years. The institution still expects another 25bps hike in December, with the terminal rate for this hiking cycle likely not far from current levels. New variables in the Middle East situation are not yet sufficient to provide a clear and lasting exit path for both the U.S. and Iran, high oil prices may persist until the situation becomes clearer, and further improvement in dollar liquidity requires new catalysts.
Guosheng Securities: Q3 Active Equity Fund Positions Broadly Declined, Pharmaceuticals Saw Most Additions, Electronics Most Reduced (Market Assessment)
In Q3 2026, overall equity positions in active equity funds declined: median equity positions for ordinary equity funds, partial-equity hybrid funds, and flexible allocation funds stood at 90.56%, 89.02%, and 83.55%, respectively, down 0.69, 1.47, and 3.73 percentage points from the previous quarter. By board, main board and Hong Kong stock weightings increased (+4.11 and +2.32 percentage points), while ChiNext and STAR Market weightings fell (-2.97 and -3.47 percentage points). By industry, electronics remained the largest allocation sector (34.38%) but saw the largest active reduction (-2.79 percentage points), while pharmaceuticals received the largest active additions (+1.94 percentage points); fixed income plus funds reduced electronics even more aggressively (active reduction of 5.43 percentage points). At the individual stock level, the top three by absolute allocation market value were Zhongji Innolight, Eoptolink, and WuXi AppTec (87.3 billion, 80.4 billion, and 43.1 billion yuan), while the top three active additions were WuXi AppTec, TFC Optical Communication, and Zijin Mining.
Guotou Securities: Central Bank's BNSF Tool with Zero Net Injection Blocks Negative Feedback from Redemption Selling, Medium- to Long-Term Positive for Bond Market
On October 26, the central bank established the Bond Market Non-Bank Large Redemption Swap Facility (BNSF), positioned as a crisis-management liquidity support tool with no explicit backstop: scenarios are limited to systemic stress in the bond market, counterparties are limited to wealth management subsidiaries and public fund managers with systemic influence, and usage is limited to purchasing holdings of their own products that have been redeemed; the central bank lends central bank bills rather than funds, with credit risk and valuation losses remaining with the institutions themselves. The tool provides zero net liquidity injection throughout, but blocks the negative feedback loop of "product net value drawdown—liability-side redemption—forced asset-side selling" in three ways: using central bank bills as collateral to replace "must sell bonds" with "can hold bonds for financing"; limiting purchases to holdings of their own products to internalize the externality of discounted selling; and reducing the probability of managers front-running redemption expectations once they have a liquidity backstop. Over the medium to long term, the tool helps compress liquidity tail risk premiums, with the most obvious beneficiaries being short- to medium-term high-grade credit bonds heavily held by wealth management and public funds that are prone to being sold during stress periods; since it does not inject base money or directly affect yield levels, its positive effect on the bond market is indirect and relatively limited in magnitude.
Huafu Securities: Physical AI Competition Extends Across the Full Chain, Data Collection Becomes a Key Link for Deployment
This week saw dense progress in the physical AI sector, with industry competition extending from single-point model capabilities toward a systematic full chain of "physical reasoning—simulation training—real-world deployment"; NVIDIA expanded its Isaac platform and jointly launched the Agile ONE-SN humanoid robot reference platform, promoting software-hardware collaboration and integrated development processes. As robot large models move toward real-task validation, data collection becomes a key link affecting model iteration and deployment efficiency, and data collection equipment makers, data collection companies, and robot OEMs in the data collection industry chain deserve attention.
Sinolink Securities: AI Drug Discovery Moves from Tool to Engine, Can Compress R&D Cycles by 50-90% and Save About $54 Billion
AI drug discovery can compress R&D cycles by 50-90% and save about $54 billion in costs; MNCs are accelerating their positioning, with global AI drug discovery deal upfront payments reaching $1.8 billion in the first half of 2026 and total deal value surpassing $50 billion. With AI empowerment, Phase I clinical success rates exceed 70% (versus about 50% traditionally), while Phase II-III still awaits validation. The dry-wet closed loop drives expanded demand for wet lab experiments; Twist has completed over 200,000 protein expressions and 130,000 antibody tests, and the industry is growing rapidly with broad space.
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