Breakfast | Tesla's financial report is coming this week! Apple iPhone 16's sales in China exceeded expectations and increased significantly

Market Overview Last Friday

S&P 500 and Dow hit new highs again, rising for six consecutive weeks, marking the longest weekly gain of the year for S&P 500 and Dow.

Russell small-cap stocks turned lower in the afternoon. The chip index fell 2.4% for the week, with NVIDIA approaching a new high. iPhone 16's first launch in China saw a 20% surge in sales, pushing Apple to a new high. Netflix soared 11% on its first trading day after earnings, marking its best one-year gain and hitting a new high. European luxury stocks rose.

During the Asian session, A-shares traded over 2.1 trillion yuan, with the ChiNext Index surging 8%. Semiconductors and brokerage stocks led the gains, while the Hang Seng Tech Index rose nearly 6%.

Key Focus This Week

China's October LPR quotation and MLF operation rates, profits of industrial enterprises above designated size in September, preliminary PMI data for October in Europe and the United States, and Tesla kicks off the tech giants' earnings season.

In addition, the BRICS leaders' summit opens, the U.S. releases the Beige Book on economic conditions, and companies like Coca-Cola and IBM will announce their latest earnings.

Individual Stock News

Tesla Kicks Off Tech Giants' Earnings Season This Week

After the U.S. market closed on Wednesday, October 23, Tesla will announce its third-quarter earnings for this year early Thursday morning Beijing time. Musk stated, "The U.S. auto industry is very difficult," with only "Ford and Tesla not bankrupt." When asked why Tesla did not acquire competitor Rivian, Musk said he hopes Rivian succeeds, as without breakthroughs in electrification and autonomous driving, Tesla would not have succeeded.

Institutional Data Shows iPhone 16 Series Sales in China Increased by 20% in the First Three Weeks of Launch

Sales of high-end models increased by 44% year-on-year. The recovery in iPhone demand may further drive sales of Apple Watch and other accessories. However, Apple still faces strong competition pressure from brands like Huawei, Vivo, and Xiaomi.

Is NVIDIA Expensive? Wall Street: Not at all, this is a once-in-a-lifetime opportunity for a generation

Bank of America stated that NVIDIA's PEG ratio is lower than its peers, making its valuation still attractive. It is expected that by 2027, its P/E ratio will drop to 24 times; Goldman Sachs believes that NVIDIA's valuation is close to the median P/E ratio of the past three years, and compared to its peers, its historical valuation is relatively low.

OpenAI Transitions to a Profitable Enterprise, Negotiations on How Microsoft's Nearly $14 Billion Investment Will Convert to Shares Have Begun

Both Microsoft and OpenAI have hired investment banks to provide advice for this negotiation, highlighting its importance. Analysts believe that when a company transitions to a profitable enterprise, how to allocate equity is one of its biggest challenges. As the largest investor in OpenAI to date, Microsoft may receive a significant amount of equity in the company.

Media Leaks: Once OpenAI Develops AGI, Microsoft Will Lose Access to OpenAI's Technology

According to media reports, there is a clause in the contract stating that if OpenAI develops AGI, Microsoft will not be able to use OpenAI's technology. This clause is designed to ensure that tech giants like Microsoft do not misuse AGI technology. The issue is that, according to the clause, OpenAI's board of directors can decide when AGI will arrive

Google Organization Faces Major Adjustments

Gemini merges into the DeepMind team, and the head of search advertising business is promoted to Chief Technology Officer. Google's CEO stated, "The development speed of AI exceeds any previous technology. In order to continuously accelerate progress, we have made efforts to simplify the structure. This transfer will bring these teams closer together, improve the feedback loop, and allow us to quickly deploy new models to the Gemini application."

Intel's "Self-Rescue" New Move: Selling "Future Core" Altera Shares for $17 Billion

Media reports that Intel is seeking interested private equity and strategic investors this week, possibly selling the majority of Altera shares. Intel acquired Altera's programmable chip business for $16.7 billion in 2015, made it a subsidiary in February this year, and is seeking an IPO in 2026. Intel's CEO also mentioned last month that Altera is a core part of the company's future.

Li Ka-shing and His Son Once Again Sell Bulk of Postal Savings Bank H Shares

This is the third time Li Ka-shing has sold a large amount of shares of Postal Savings Bank since its listing. The cumulative reduction of Postal Savings Bank shares this year reached 278.6 million shares, allowing Li Ka-shing to receive over 1.2 billion Hong Kong dollars in cash.

TSMC's 2nm Process, Unmatched

TSMC currently has plans for a total of 7 2-nanometer fabs, making it the company's most numerous generation of processes in history, surpassing competitors Samsung and Intel. This signifies TSMC's dominance in advanced processes, portraying a one-man show.

Did a Large Model Suffer Losses of Over Ten Million Dollars Due to Intern Attacks?

ByteDance responds: The reported losses are greatly exaggerated and do not involve commercial formal projects or online businesses.

Macro News

Positive Economic Data in China

China's GDP grew by 4.6% in the third quarter, with faster year-on-year growth in September in social retail sales of consumer goods. Industrial growth, after slowing for four months, rebounded, while the growth rate of fixed asset investment stabilized and remained the same as in August. Various real estate indicators in the first three quarters showed narrowing declines.

Housing Prices in 70 Chinese Cities in September

In first-tier cities, new and second-hand housing prices accelerated their decline, while new housing prices in second and third-tier cities stabilized month-on-month. Among second-hand housing prices in first-tier cities, Beijing, Shanghai, Guangzhou, and Shenzhen saw year-on-year declines of 10.3%, 7.6%, 12.8%, and 12.0% respectively, with month-on-month declines of 1.3%, 1.2%, 1.1%, and 1.3% respectively.

People's Bank of China Launches Two Monetary Policy Tools in One Day to Support Capital Markets

The People's Bank of China officially launched the Securities, Funds, and Insurance Companies Interchange Facility (SFISF): with an initial scale of 500 billion yuan, 20 securities and fund companies have been approved, and the first batch of application quotas has exceeded 200 billion yuan. Eligible collateral includes bonds, stock ETFs, constituents of the SSE 300 Index, and public REITs, with discount rates set based on the risk characteristics of the collateral. Funds obtained through this tool can only be invested in the capital market for stocks, stock ETFs, and market-makingThe People's Bank of China officially launched the stock repurchase and increase re-lending, with an initial quota of 300 billion yuan. Starting from Friday, 21 national financial institutions can issue related loans to eligible listed companies and major shareholders, and in the first month of the next quarter, apply for re-lending from the People's Bank of China. For qualified loans, re-lending support will be provided at 100% of the loan principal, with an initial quota of 300 billion yuan, an interest rate of 1.75%, a one-year term, extendable depending on the situation, with a cumulative term estimated to reach 3 years.

During his inspection in Anhui, Xi Jinping emphasized leveraging the overlapping advantages of multiple national development strategies and striving to compose the Anhui chapter of Chinese-style modernization.

Xi Jinping pointed out that to promote Chinese-style modernization, science and technology must take the lead, and technological innovation is the only way forward. High technology cannot be begged or borrowed; it must accelerate the realization of high-level technological self-reliance. Scientific researchers are the backbone of promoting Chinese-style modernization, and they must exert the effort of "how many chances does life have" to innovate and create, contributing their wisdom to building a strong country in science and technology and writing a brilliant chapter.

The U.S. government's budget deficit for the fiscal year 2024 hits the third highest record, only surpassed by the two years during the COVID-19 pandemic.

The U.S. has seen a deficit exceeding 6% of GDP for two consecutive fiscal years; the high interest rates of the Federal Reserve are the main driver of the deficit. In the fiscal year 2024, the government's debt interest expenses increased by $254 billion year-on-year, a 29% increase to $1.1 trillion, the highest proportion of GDP since 1998; social security expenditures increased by over $100 billion in one year; total government revenue reached a record high of $4.9 trillion for the full fiscal year, an increase of $479 billion in one year, with half of the increase coming from personal income taxes