To The Moon

On the previous trading day (November 10), the Shanghai Composite Index rose 0.08% to 3,663.72 points, the Shenzhen Component Index gained 0.86% to 11,241.54 points, and the ChiNext Index climbed 1.46% to 2,494.40 points. Total turnover across the two markets reached 1,920.944 billion yuan, with 4,273 stocks advancing and 1,149 declining, including 86 hitting the daily limit up and none hitting the limit down.

Huafu Securities believes that with the support of market stabilization tools, A-shares are expected to continue recovering, with offensive plays in new energy, domestic computing power, and physical AI. CITIC Securities holds that October's export growth exceeded expectations on price contributions and is likely to remain resilient in November-December. Huayuan Securities argues that the Fed's pause on rate hikes does not remove inflation constraints, with the probability of a 25bp hike in December rising to 85%. Guosheng Securities suggests that physical interaction brains fill the control vacuum between large models and physical execution. Sinolink Securities notes that 3D printing is driving a surge in PLA demand, with consumable demand potentially reaching 140,000 tons by 2026.

Huafu Securities: A-Share Recovery Expected to Continue with Strong Support from Market Stabilization Tools

Last week (11/2-11/6), the market experienced a volatile rebound, with the All-A index rising 3.36%. The STAR 50 and CSI 1000 led gains, while the CSI Dividend lagged. In terms of style, advanced manufacturing and pharmaceuticals/healthcare led, while financials and real estate trailed. Among the 31 Shenwan primary industries, more rose than fell, with media, power equipment, and agriculture/forestry/fishery leading, while petroleum/petrochemicals, coal, and telecommunications lagged.

At the market observation level, the stock-bond yield spread fell to 1.5%, between +1 and +2 standard deviations. Sentiment and industry rotation intensity rose simultaneously, with large-cap style outperforming and micro-cap stocks beating the market. Theme热度 concentrated in AI short dramas, Seedance video large models, and virtual humans. On the funding side, the daily average turnover and number of trades via Stock Connect increased by 48.452 billion yuan and 2.381 million trades respectively month-on-month. Leverage funds saw a net outflow of 55.54 billion yuan, while ETFs played a greater role in offsetting outflows. Newly established equity-biased funds averaged 3.0 billion shares per day, down 45.1% year-on-year.

In terms of industry hotspots, the Lijian-2 Y2 rocket successfully launched and for the first time executed a large-scale satellite internet networking mission. Apple's HALO research achieved an average success rate of 91% in single-task tests. Qualcomm showcased its 6G terminal prototype globally for the first time. With strong support from market stabilization tools, A-shares are expected to continue recovering. Offensive directions include the new energy industry chain, which has expectations of improved policy environment after Democrats won both chambers, domestically controllable computing power, and physical AI and AI applications with industry catalysis. Meanwhile, defensive space should be retained in dividend assets with stable cash flow and sustainable dividends.

CITIC Securities: Price Increases Drive Both Import and Export Growth Above Expectations

October export growth continued to beat expectations, with prices being the main contributing factor. In terms of products, supported by price increases, October exports of electronics and AI products hit a new year-high growth rate. After refined oil export controls shifted to "limited recovery," refined oil export growth remained at a high level for three consecutive months from August to October. In October, mainland China's export growth to South Korea, Taiwan region, and ASEAN remained high, closely related to strong AI and electronics chain exports, while exports to the US and Europe continued the recovery trend since August-September.

October import growth was significantly higher than expected, outperforming the domestic manufacturing PMI, mainly due to price increases in upstream oil/gas, coal, and other commodities as well as the electronics and AI industry chain. Looking ahead, influenced by factors such as continued storage price increases upstream and potentially stable US tariffs on China after the midterm elections, exports are expected to remain resilient in November-December this year. However, under the influence of multiple factors, next year's export outlook may face greater pressure.

Huayuan Securities: Pause in Rate Hikes Does Not Change Inflation Constraints — Fed's October Meeting

The Federal Reserve kept the federal funds rate target range unchanged at 3.75%-4.00% in the early hours of October 29 Beijing time, with a 10-2 vote. Cook and Hammack both advocated for an immediate 25bp rate hike. Compared with September's unanimous 12-0 vote for a hike, divisions reappeared and clearly pointed to whether inflation should be suppressed more quickly. Although this was the first pause after September's hike, it cannot be taken as confirmation that the tightening cycle has ended.

The statement replaced the key word "action" with "information," essentially shifting the December decision from a predetermined path to data guidance. The two mandate pressures point in opposite directions, increasing decision difficulty. Rising US Treasury yields themselves constitute a source of tightening beyond the policy rate. CME FedWatch data shows that the futures-implied probability of a 25bp hike in December rose to 85.0% after the meeting (78.3% the day before). However, market probabilities are not policy commitments. The rate path after December depends on whether employment remains solid and whether inflation stickiness persists, with greater divergence than the December meeting itself.

Guosheng Securities: Physical AI's Next Super Track — "Physical Interaction Brain"

The hand-eye-brain integrated algorithm dexterous hand serves as the "last centimeter" physical carrier, with core pain points in tactile feedback and real-time force control. The essence of the physical interaction brain is to fill the control vacuum between general large models and底层 physical execution, pushing robots from "can demonstrate" to "can work." Recommendations: 1) Hand-eye-brain integration: Daimon Robotics (unlisted), PaXini (unlisted), etc.; 2) Tactile: Fulai New Materials, Jinghua New Materials, Cixing Co., etc.; 3) Dexterous hands & micro-motor modules: Moons Electric, Zhaowei Machinery & Electronics, Leadshine Technology, Zhejiang Rongtai, etc.

Sinolink Securities: Bullish on Volume and Price Rise in 3D Printing Upstream

3D printing drives PLA demand surge: PLA consumables were about 40,000 tons in 2024 and are expected to reach 140,000 tons by 2026, with a CAGR of 87%. 94% of global desktop machines are made in China, and DIY consumption in Europe and the US is exploding. Lactic acid prices have already risen (Jindan +8%), PLA capacity utilization is climbing, Hisun is at full capacity, and new capacity will not come online until at least 28H1, indicating a clear supply bottleneck. Focus on domestic lactic acid/polylactic acid leaders.