Breakfast | Technology stocks strengthen, Nasdaq leads U.S. benchmark stock indices, S&P 500 ends four-day losing streak

Market Overview

Before NVIDIA's earnings report, technology stocks strengthened, driving the Nasdaq to lead the U.S. stock benchmark indices, the S&P 500 ended a four-day decline. Google rose over 6% at one point after releasing its latest AI model yesterday. After NVIDIA's earnings announcement, it rose 6% in after-hours trading, boosting the Nasdaq 100, which rose 1% in after-hours trading. Cryptocurrency concept stocks plummeted.

The absence of the Federal Reserve's minutes and October non-farm data suppressed market rate cut expectations, with the dollar and U.S. Treasury yields rising together. The 10-year U.S. Treasury yield rose by 2.5 basis points. The dollar broke through 100, rising 0.67% during the day. The dollar surged over 1% against the yen, returning to 157 for the first time in 10 months.

Bitcoin once again fell below $90,000 during the session, then rebounded, still down over 2% for the day. Ethereum fell 8% at one point, dropping below $2,900, before rebounding. Spot gold struggled to rebound by 0.25%, briefly rising back to $4,100 during the day. Silver rose 1.3% after a pullback. Crude oil fell over 3% at one point, with reports suggesting the White House may reach a framework on Russia and Ukraine this week.

During the Asian session, A-shares fluctuated and closed higher, with lithium mining surging again. Hong Kong stocks opened high but fell, with Xiaomi leading the decline among technology stocks, and lithium carbonate futures breaking through the 100,000 mark.

Key News

Dutch officials: Have suspended interventions against ASML. Ministry of Commerce: Welcomes the Netherlands' proactive suspension of the ASML administrative order, but there is still a gap to "revoke the administrative order."

NVIDIA surprised the market, with last quarter's revenue accelerating by 62%, and this quarter's guidance exceeding expectations again. Jensen Huang stated that cloud GPUs are sold out. The CFO mentioned that the A100 GPUs shipped six years ago are still operating at full capacity this year. NVIDIA's stock rose 6% in after-hours trading.

Due to supply constraints, NVIDIA's chips have reportedly switched to mobile-style memory, analysts suggest that this move could double server memory prices next year.

Federal Reserve meeting minutes revealed serious divisions: many believe it is inappropriate to cut rates in December, while some are concerned about a disorderly decline in the stock market. "The New Federal Reserve News Agency": Decision-makers, who may hold a slight majority, feel uneasy about a rate cut in December.

U.S. October non-farm data will not be released, and the November report unexpectedly will be released after the Federal Reserve's December meeting, with the market expecting no rate cuts this year!

Saudi Arabia and the United States signed a strategic partnership in artificial intelligence. The U.S. plans to approve the sale of advanced chips to Saudi Arabia, with NVIDIA and AMD likely to supply the Middle East. AMD, Cisco, and Saudi AI company Humain are establishing a joint venture, aiming to build a 1-gigawatt data center within five years. Musk: xAI is collaborating with Saudi Arabia to build a 500-megawatt data center, with NVIDIA participating.

The sell-off of Japanese bonds is intensifying: the 10-year yield has reached a new high since the financial crisis. An advisor to the Japanese Prime Minister stated: "Fiscal first, then monetary," and there will be no interest rate hikes before March next year.

Duan Yongping Q3 Holdings: Significantly increased holdings in Berkshire, cut NVIDIA holdings by 38%, reduced Apple, Pinduoduo, Google, and established a position in ASML.

Hui Jin System takes another major action! China International Capital Corporation plans to absorb and merge Dongxing Securities and Cinda Securities.

Kuaishou Q3 revenue increased by 14% year-on-year, net profit increased by 37% year-on-year, AI revenue exceeded 300 million, and DAU has reached a historical high for three consecutive quarters.

Market Closing Report

US and European Stock Markets: The S&P 500 rose by 0.38%, ending a trend of four consecutive trading days of decline, closing at 6642.16 points. The Dow Jones rose by 0.10%, closing at 46138.77 points. The Nasdaq rose by 0.59%, closing at 22564.229 points. The European STOXX 600 index closed down by 0.03%, closing at 561.71 points.

A-shares: The Shanghai Composite Index rose by 0.18%, closing at 3946.74 points; the Shenzhen Component Index slightly declined, closing at 13080.09 points; the ChiNext Index rose by 0.25%, closing at 3076.85 points.

Bond Market: The yield on the US 10-year benchmark Treasury bond rose by 1.55 basis points, closing at 4.1289%. The yield on the 2-year US Treasury bond rose by 1.48 basis points, closing at 3.5873%.

Commodities: COMEX gold futures rose by 0.36%, closing at $4081.10 per ounce. WTI December crude oil futures closed down by $1.30, a decline of 2.14%, closing at $59.44 per barrel.

News Details

Global Highlights

Dutch Official: Intervention on ASML Semiconductor Has Been Suspended. Ministry of Commerce: Welcomes the Netherlands' Initiative to Suspend Administrative Order on ASML Semiconductor, but There is Still a Gap to "Withdraw the Administrative Order".

• According to Global Times, Dutch Minister of Economic Affairs Karremans stated on the 13th local time that a Dutch government delegation will visit China "early next week" to seek solutions regarding the issues with ASML Semiconductor, a subsidiary of Chinese company Wingtech Technology. On November 13, a spokesperson for China's Ministry of Commerce stated that since the issue with ASML Semiconductor arose, China has maintained a responsible attitude towards the stability and security of the global semiconductor supply chain, engaging in multiple rounds of consultations with the Netherlands, and agreed to the request for Dutch economic officials to come to China for discussions. We hope the Dutch side will demonstrate a sincere willingness to cooperate with China, propose substantive and constructive solutions to the problem as soon as possible, and take practical actions to quickly and effectively restore the safety and stability of the global semiconductor supply chain from the source
• According to the Ministry of Commerce, China welcomes the Netherlands' proactive suspension of the administrative order, believing it is the first step towards properly resolving the issue. However, there is still a gap to address the root cause of the global semiconductor supply chain turmoil and chaos, which is the "repeal of the administrative order." At the same time, the erroneous ruling by the corporate court, driven by the Dutch Ministry of Economic Affairs, that deprives Nexperia of control over Dutch Nexperia remains a key obstacle to resolving the issue. China hopes the Netherlands will continue to demonstrate a sincere willingness to cooperate with China and genuinely propose constructive solutions to the problem.

NVIDIA surprises, last quarter's revenue accelerated growth of 62%, this quarter's guidance exceeds expectations again, Jensen Huang states cloud GPUs are sold out. Total revenue in the third quarter saw its first year-on-year acceleration in two years, with data center revenue reaching a new quarterly high, increasing by 66% year-on-year and nearly 25% quarter-on-quarter; the median revenue guidance for the fourth quarter is expected to grow by 65% year-on-year, with a gross margin expected to be 75%, marking the first year-on-year increase in six quarters.

• Jensen Huang stated that the sales of Blackwell chips far exceeded expectations, with both training and inference computing demands growing exponentially. The CFO reiterated that new chips are expected to generate $500 billion in revenue over the next few quarters, noting that the A100 GPUs shipped six years ago are still operating at full capacity this year. The stock price rose by as much as 6% in after-hours trading.

Supply tightens, NVIDIA chips reportedly switch to mobile-type memory, analysts say: this move may double server memory prices next year. A Counterpoint report stated that NVIDIA is shifting AI server memory from DDR5 to mobile LPDDR chips to reduce power consumption, with demand equivalent to that of a major smartphone manufacturer. The current memory market is already short due to manufacturers shifting production to high-end AI chips, and NVIDIA's move exacerbates the tight situation. Analysts expect server memory prices to double by the end of 2026, increasing costs for cloud service providers and AI developers.

Federal Reserve meeting minutes reveal serious divisions: Several believe it is inappropriate to cut rates in December, some worry about disorderly declines in the stock market.

• Some participants believe it may be appropriate to cut rates in December, while many believe it may be appropriate to maintain rates this year; several believe that raising tariffs this year has limited impact on inflation, and most believe that, in the context of high inflation and a cooling job market, cutting rates may exacerbate inflation risks or be misinterpreted as insufficient commitment to reducing inflation; some are concerned about the overvaluation of financial assets, fearing that if the market suddenly reassesses the AI outlook, stock prices may decline disorderly; there is almost unanimous support for ending balance sheet reduction in December, with many supporting an increase in short-term bond holdings.
• "New Federal Reserve Communications": Decision-makers, possibly in a slight majority, feel uneasy about a rate cut in December.U.S. will not release October non-farm payrolls, November report unexpectedly after Fed's December meeting, market expects no rate cuts this year! The U.S. Bureau of Labor Statistics (BLS) announced that it will not release the October non-farm employment report, but will incorporate the relevant employment data into the November report. The November non-farm employment report will be released on December 16, more than a week later than originally planned, and will be published after the Federal Reserve's last meeting of the year. Following the announcement, investors believe the likelihood of a rate cut by the Fed in December has decreased, as the delay in official data may lead to greater divergence among policymakers regarding the outlook. Bond traders have almost abandoned bets on a rate cut in December.

Trump again criticizes Powell: wants to fire him, jokingly says Basant "only messed up the Fed issue". On Wednesday, Trump urged U.S. Treasury Secretary Basant to expedite the search for Powell's successor at the U.S.-Saudi Investment Forum held in Washington, D.C. Trump also half-jokingly pressured Basant: "Interest rates are too high, Basant, if you don't get it done quickly, I'm going to fire you."

Fed Governor Miran: Calls for prioritizing the reshaping of bank regulation, which may allow the Fed to shrink its balance sheet again in the future. Federal Reserve Governor Stephen Miran stated that he hopes the Fed will first readjust a series of regulatory provisions on Wall Street before discussing other economic issues related to the central bank's balance sheet. Easing the regulatory burden on financial institutions may allow the Fed to reduce the size of its balance sheet again in the future. He also mentioned that he originally hoped to end quantitative tightening (QT) in October.

Saudi Arabia and the U.S. sign strategic partnership in artificial intelligence. Saudi Foreign Minister Prince Faisal bin Farhan and U.S. Secretary of State Rubio jointly signed the agreement. Both parties stated in a joint statement that this move is a new milestone in the strategic relationship between the two countries, reflecting a firm commitment to advancing innovation and technological progress.

• The U.S. plans to approve the sale of advanced chips to Saudi Arabia, with Nvidia and AMD expected to supply the Middle East. Reports indicate that the U.S. plans to approve the sale of advanced AI chips to Saudi artificial intelligence company Humain, with the agreement potentially finalized as early as this week, and the number of approved chips expected to reach tens of thousands, which will open supply channels to the Middle Eastern market for chip companies including Nvidia and AMD
• AMD, Cisco, and Saudi AI company Humain establish a joint venture to build a 1 GW data center within 5 years. The initial 100 MW project is expected to start construction in 2026, with computing power fully contracted by generative video company Luma AI.
• Musk: xAI collaborates with Saudi Arabia to build a 500 MW data center, with NVIDIA participating. Additionally, Musk's xAI plans to raise $15 billion, with a valuation potentially reaching $230 billion, far exceeding the $113 billion valuation in March this year.

Bitcoin's sharp decline drags down, the world's largest spot Bitcoin ETF sees record redemptions in a single day, with nearly $2 billion net outflow in November. BlackRock's IBIT faced an outflow of $523 million on Tuesday, setting a record for the highest single-day redemption since the fund's launch in January 2024. IBIT has seen nearly $2 billion in outflows in November, while the entire U.S. spot Bitcoin ETF market has experienced over $3 billion in outflows this month.

The sell-off of Japanese bonds intensifies: 10-year yields hit a new high since the financial crisis, and demand for 20-year auctions weakens. The severe sell-off of Japanese bonds is driven by market expectations that Prime Minister Kishida's government may plan to introduce a supplementary budget far exceeding expectations, raising concerns that this massive expenditure will have to be financed through the issuance of a large amount of government bonds, thereby adding extra supply pressure to the market.

• Japan's Prime Minister's advisor: "Fiscal first, then monetary," no interest rate hikes before March next year. Goushi Kataoka, an economic advisor to Prime Minister Kishida, stated that the Bank of Japan is unlikely to raise interest rates before March next year, emphasizing that policy should prioritize boosting domestic demand through approximately 20 trillion yen in fiscal spending, followed by advancing monetary policy normalization. This statement sharply contrasts with the market's aggressive expectations for recent interest rate hikes, as the government advisory team tends to delay the timeline for monetary policy normalization amid weak economic data.

Duan Yongping's Q3 holdings: significantly increased stake in Berkshire, cut NVIDIA holdings by 38%, reduced positions in Apple, Pinduoduo, Google, and established a position in ASML. Dubbed the "Chinese Buffett," Duan Yongping announced significant adjustments to his Q3 holdings. His core operations include a substantial increase in his stake in Buffett's Berkshire, while also establishing a new position in lithography giant ASML, and reducing his holdings in NVIDIA by 38% and other tech stocks like AlibabaDuan Yongping has a deep connection with Buffett. In 2006, he spent $620,000 to win a lunch with Buffett, and this time he reduced his holdings in Apple stocks simultaneously with the "stock god."

Another major move by the Huijin system! CICC plans to absorb and merge Dongxing Securities and Cinda Securities. As a financial platform representing national will, Huijin's promotion of the integration of brokerage stocks is an important measure to implement the national financial strategy. Industry insiders believe that the small and medium-sized brokerages under Huijin, Dongxing Securities, Cinda Securities, and Great Wall Guorui Securities, may form advantages through integration to achieve regional and specialized development, and may also integrate with leading brokerages to complement each other's business capabilities.

• Huijin plays the brokerage trump card: the trillion-yuan strategy behind CICC's "swallowing the elephant". Regarding complementarity, CICC explained: The deep accumulation of resources in networks, clients, and capital by Dongxing Securities and Cinda Securities will complement CICC's comprehensive investment banking, professional investment, cross-border trading services, and wealth management capabilities.

Kuaishou's Q3 revenue increased by 14% year-on-year, net profit increased by 37% year-on-year, and Keling AI revenue exceeded 300 million, with DAU reaching a historical high for three consecutive quarters. The financial report shows that the average daily active users of the Kuaishou app reached 416.2 million, breaking historical highs for three consecutive quarters. Keling AI's Q3 revenue exceeded 300 million, and the 2.5 Turbo model topped the global text-to-video rankings, with the cost of generating a single video reduced by nearly 30%. Kuaishou Chairman Cheng Yixiao stated: "While we are firmly investing in AI strategy, we have achieved a year-on-year improvement in the overall profitability of the group, and the empowering value of AI technology on Kuaishou's content and business ecosystems is continuously being released."

Learning from history, when will the capital expenditure boom turn into a bubble burst? BCA Research reviewed four capital expenditure booms in railways, electrification, the internet, and oil, summarizing five major collapse patterns: ignoring the S-curve of technology adoption, underestimating price declines, over-relying on debt, asset prices peaking before investments, and expenditure collapses triggering recessions. The current AI boom has shown warning signs—stagnation in adoption rates, token prices dropping over 99%, a surge in corporate debt, and declining GPU costs. The report warns that the AI bubble will burst within 6 to 12 months, advising investors to maintain a neutral position in the short term and underweight stocks in the medium term, while paying attention to analyst expectations and GPU costs as leading indicators.

The bull market for power equipment is "still in the early to mid-stage," JP Morgan: The upgrade of the US power grid has not yet started, and Chinese companies have breakthroughs in the US market potential. JP Morgan believes that AI-driven growth in power consumption is accelerating, with extreme tension on the supply side and structural explosions on the demand side—the order backlog of leading power equipment companies has reached 2.5 to 2.8 times their revenue, with profit visibility locked in until 2027-2028With the ongoing global shortage and the gap in domestic production capacity in the United States, Asian and Chinese companies with cost advantages and delivery capabilities are expected to gain more market share and enjoy profit surges from high margins overseas.

Domestic Macro

People's Daily Zhongsheng: No country will tolerate threats of force from foreign leaders against its own country; the "poison" cast by Japan's Prime Minister Kishi Nobuo on China-Japan relations must be resolved by themselves! An article by Zhongsheng in the People's Daily titled "Poisoning China-Japan Relations Will Ultimately Backfire" points out that Prime Minister Kishi Nobuo's blatant advocacy for military intervention in the Taiwan Strait seriously violates the spirit of the four political documents between China and Japan and undermines the political foundation of bilateral relations. The article emphasizes that the Taiwan issue is at the core of China's core interests, and any actions that touch the red line will be firmly opposed by the Chinese people, urging Japan to immediately stop crossing the line and playing with fire, and to earnestly fulfill its political commitments to China.

Domestic Companies

AI revenue of 10 billion yuan disclosed for the first time, autonomous driving accelerates, is it time for Baidu's revaluation? Baidu disclosed for the first time in the third quarter that its AI revenue reached 10 billion yuan, a year-on-year increase of 50%, becoming the biggest highlight of its better-than-expected performance. AI cloud, AI native marketing, and AI applications are all making strides, offsetting the decline in traditional advertising and reshaping the revenue structure. Citigroup raised its target price to $181, believing that increased transparency in AI, growth in cloud business, and accelerated deployment of autonomous ride-hailing will drive Baidu's valuation recovery.

Kingsoft Cloud's Q3 adjusted net profit of 28.7 million yuan, achieving single-quarter profitability for the first time, with AI billing business revenue up 120% year-on-year.

Overseas Macro

White House National Economic Council Director Hassett: Tariff rebate checks "should be on the table for discussion." Kevin Hassett, one of the candidates for Federal Reserve Chairman and Director of the White House National Economic Council, stated on Wednesday that the U.S. has made progress in reducing debt, and Congress will have room next year to discuss including "tariff rebate checks" in the budget reconciliation bill. Some Republican lawmakers oppose this, believing it should be prioritized for deficit reduction and are concerned about inflationary pressures.

After a trillion-dollar sell-off, the divergence between bulls and bears intensifies: Goldman Sachs CEO remains bearish, former Barclays CEO says "healthy adjustment, not a bear market." The CEO of Goldman Sachs believes that the technical outlook currently favors protective operations and more downside potential, and the market may further correct. The S&P 500 index has fallen more than 3% this month, on track for its worst monthly performance since March. Investors are closely watching Nvidia's earnings report, which is seen as a key indicator for testing the sustainability of the AI boom and market stabilityThe U.S. deficit rate may approach 6.2% in 2026, with a financing gap of $5.5 trillion over the next five years, is a peak in medium and short-term bond issuance approaching? JP Morgan's report predicts that the U.S. budget deficit for fiscal year 2026 will reach $1.955 trillion, and there will be a financing gap of $5.5 trillion over the next five years. To address this, the Treasury plans to start increasing the issuance of medium and short-term bonds by the end of 2026 while maintaining stable long-term bond issuance, and the Federal Reserve will cooperate with debt absorption through secondary market operations.

The battle for critical minerals intensifies: The EU plans to establish strategic reserves to prevent the U.S. from "hijacking" supplies. The EU, having fallen behind in the competition for rare earth resources, is planning to establish a central agency responsible for unified procurement and strategic reserves to enhance the security of industrial and defense supply chains. Officials admit that the U.S. is "one step ahead" in the global scramble for critical materials, prompting the EU to accelerate cooperation with countries like Brazil and promote supply diversification. The new agency will coordinate procurement, build inventories, and strengthen economic security, but still requires approval from 27 countries.

Oil prices plummet, European defense stocks decline, report: The White House says a framework agreement may be reached this week for Russia-Ukraine! According to media reports, senior officials from the White House stated that they expect both Russia and Ukraine to reach a framework agreement to end the conflict by the end of this month, "possibly as early as this week." Additionally, according to Global Times, the U.S. government has been "secretly negotiating" with Russia to draft a new plan to end the Russia-Ukraine conflict.

Overseas Companies

Google's Gemini 3 model gains market recognition, Alphabet's stock surged over 6% to a new high. D.A. Davidson analysts stated that Gemini 3 is a truly powerful AI model capable of competing with products released by OpenAI and Anthropic. Analysts from Bank of America Securities pointed out that Gemini 3 represents another positive step for Google in narrowing the "perceived performance gap of large language models" between itself and AI competitors. As of the time of publication, Alphabet's stock has retreated to $293.76, with an increase of over 3%.

The significance of Gemini 3: AI has surpassed the "hallucination phase," approaching human capabilities, and "human-machine collaboration" will evolve from "humans correcting AI errors" to "humans guiding AI work". Ethan Mollick believes that the emergence of Gemini 3 signifies the rise of "agent models" with autonomous action capabilities. Although not perfect, the errors it makes are no longer the baseless "hallucinations" but are closer to human biases in judgment or intent understanding. As AI capabilities improve, human-machine collaboration is evolving from "humans fixing AI's mistakes" to "humans guiding AI's work."Meta's "Segment Anything" model has been significantly upgraded! "Understanding human language," processing images with hundreds of objects in just 30 milliseconds. The SA-Co benchmark test shows that SAM 3 has doubled the performance in image and video concept segmentation compared to existing models, outperforming foundational models like Gemini 2.5 Pro and professional baseline models like GLEE; user preference for SAM 3's output is about three times that of the strongest baseline model OWLv2. Meta also released the open-source model SAM 3D for 3D reconstruction. Additionally, Meta launched the Segment Anything Playground platform, allowing ordinary users without technical backgrounds to experience SAM 3 and SAM 3D.

The "culprit" destroying the AI bull market: Oracle, the "weakest link". Investors are no longer just buying into the AI narrative but are beginning to rigorously examine the financial costs companies incur to support this narrative, especially those that fund expansion through heavy borrowing. Oracle plans to reach an annual capital expenditure of $80 billion by 2030, but analysts believe its net debt is high, cash flow remains negative, and default risk is rising.

Hugging Face CEO: We are in a "large model bubble," not an "AI bubble," and this bubble is about to burst. The CEO of Hugging Face believes that all attention, focus, and funding are concentrated on the idea of building a single model using massive computing power to solve all problems, and this bubble is expected to burst next year. Large models are not suitable for all scenarios, and more customized, specialized small models will emerge in the future to solve specific problems at lower costs and faster speeds.

The most important AI application after ChatGPT! The era of "online shopping agents" is about to arrive; who will be the winners and losers? Morgan Stanley predicts that AI shopping agents will become a new revolution in e-commerce, potentially bringing up to $115 billion in incremental revenue to the U.S. market by 2030. These AI assistants, capable of cross-platform price comparison and automatic ordering, will reshape shopping patterns and advertising landscapes. Retailers with strong infrastructure, such as Amazon and Walmart, will benefit, while high-commission platforms like Etsy will face challenges.

The weight loss battle "has been decided," Eli Lilly approaches "the first $1 trillion pharmaceutical company". According to analysis, Eli Lilly's drug Zepbound has gained absolute dominance in the new prescription drug market, skyrocketing its market value to about $970 billion, while competitor Novo Nordisk has significantly lagged, with a market value dropping to about $200 billionWith the agreement reached with the U.S. government on healthcare coverage, the resolution of production capacity bottlenecks, and the upcoming launch of more convenient oral medications, Eli Lilly's leading position in the weight loss drug market is expected to be further consolidated.

Target's same-store sales have declined for three consecutive quarters, lowering full-year guidance, and the stock price has fallen back to 2019. Target's same-store sales in the third quarter fell for the third consecutive quarter, down 2.7% year-on-year, which was below expectations. The company lowered its full-year profit guidance to $7-8, reflecting weak demand, declining foot traffic, and ongoing pricing pressure. Net profit fell 21% year-on-year, and the stock price dropped 5% in pre-market trading, reaching its lowest point since mid-2019. Incoming CEO Fidelke stated that he is "not satisfied" with the current performance and plans to increase capital expenditures and promote store reforms. The company also announced a partnership with OpenAI to enhance its AI capabilities.

Today's News Preview

China's November one-year and five-year Loan Prime Rate (LPR).

China's October Swift RMB share in global payments.

U.S. September non-farm payroll report.

U.S. initial jobless claims for last week.

U.S. October existing home sales.

Germany's October PPI.

Federal Reserve Governor Cook, Cleveland Fed President Mester, and Chicago Fed President Goolsbee will speak.