A-share markets staged a broad rebound on November 2, with all three major indices recovering. The indices surged before pulling back slightly, and the ChiNext Index climbed more than 3.5% at one point during the session. Combined turnover across the Shanghai and Shenzhen markets reached 1.78 trillion yuan, an increase of 109.2 billion yuan from the previous trading day.
On the board, the AI comic drama concept strengthened, with Jetsen Technology, Guomai Culture, Haikan Co Ltd, Huashi Technology, and Mango Excellent Media hitting the 20CM daily limit, while Aofei Entertainment, Dasheng Culture, Longban Media, and Zhewen Pictures hit the daily limit, and Wentou Holding staged a "floor-to-ceiling board" move; gaming stocks rallied collectively, with Dasheng Culture, Youzu Interactive, Electronic Soul Network, and Giant Network hitting the daily limit; baijiu concept stocks strengthened, with Huangtai Liquor posting two consecutive limit-ups and Shuijingfang and Jinzhongzi Liquor hitting the daily limit; major financial stocks surged, with Sinolink Securities, Pacific Securities, Yinzhijie, and Hundsun Technologies hitting the daily limit. On the decline side, precious metals concept stocks saw choppy adjustments, with Chifeng Gold and Shanjin International falling.
As of the close, the Shanghai Composite Index stood at 3,638.03 points, up 1.08%, with turnover of 847.5 billion yuan; the Shenzhen Component Index stood at 11,010.68 points, up 1.63%, with turnover of 936.2 billion yuan; the ChiNext Index stood at 2,458.70 points, up 1.87%, with turnover of 468.7 billion yuan; the STAR Composite Index stood at 1,458.50 points, up 2.62%, with turnover of 250.3 billion yuan.
On the board, sectors and concept stocks including film and cinema chains, cultural media, securities, AI video, virtual digital humans, and mobile games led the gains; sectors and concept stocks including precious metals, banking, and coal mining and processing led the declines.
Zhongtai Securities believes that full-year earnings certainty will bring steady returns for bank stocks in 2026, with short-term performance tied to market style; the economic development model will persist given strong policy resolve, and strong corporate banking business combined with persistently low risk appetite among residents will drive net interest margin to bottom out and rebound, with sustained revenue growth being a highlight and earnings certainty remaining strong. There are two main investment themes for bank stocks: first, city and rural commercial banks with regional advantages and strong certainty, in regions including Jiangsu, Shanghai, Chengdu-Chongqing, Shandong, and Fujian; second, the logic of high dividends and stability, with a focus on large banks.
China Securities notes that in 26Q3, combined cash capital expenditure of the four major cloud vendors grew 108.0% year-on-year, while operating cash flow grew 10.4%; measured by operating cash flow minus cash capital expenditure, total free cash flow fell to negative 25.04 billion USD. Microsoft's operating cash flow still covered its current investment, while the other three had negative free cash flow. Combined revenue from AWS, Google Cloud, and Azure grew 55.7% year-on-year, with increased Copilot usage, model calls, and Agent deployments, as SAP and ServiceNow advanced AI commercialization. AI demand supports infrastructure expansion, and front-loaded capital expenditure puts pressure on cash balances. Key areas to track going forward include capacity utilization, contract fulfillment, and revenue growth and cash recovery driven by application payments.
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