China Daily Briefing

Contemporary Amperex Technology's chairman Robin Zeng maintained public confidence at a recent conference, telling attendees battery storage was becoming an indispensable new infrastructure for the power system — but analysts quoted in SCMP Business are significantly less optimistic. CATL's combination of eroding battery margin, slowing domestic EV penetration, and international market access headwinds creates a trifecta most EV supply chain peers cannot absorb simultaneously. The EV/Mobility sector's -2.1% decline today is the direct read-through; watch CATL's overseas expansion pace — their European gigafactory timeline is the near-term catalyst that either validates or kills the global scale thesis.

SMIC's data centre buildout thesis — that AI compute demand stays structurally undersupplied through 2028 — is both bullish for domestic chip fabrication and a potential accelerant for US-China chip tensions. The timing is loaded: Jensen Huang's departure from Nvidia and Trump's pre-regulation Nvidia stake purchase (reported by Guardian) are injecting political noise into an already binary trade. SCMP Business notes the scrutiny over the former Nvidia CEO threatens to trigger tighter curbs — which, paradoxically, benefits domestic players like SMIC who sit on the right side of every export tightening round. CSI 300 watchers should track STAR Market semiconductor names as the structural long in this scenario.

The weighted Morgan Stanley A-Share Sentiment Indicator returning to bearish territory reinforces what FXI and KWEB's flat Friday print already told you — no fresh institutional demand is showing up for Chinese equities this week. SCMP Business noted the investment bank is maintaining a cautious outlook, which in practice means large allocators are not adding exposure. With Northbound Stock Connect data not confirming a support bid and the Shanghai Composite lacking a fresh PBOC liquidity catalyst, the base case through November is range-bound unless NDRC issues a targeted stimulus announcement or PBOC cuts the LPR ahead of schedule.