To The Moon

I. Performance of Global Equity Indices (in US Dollar)

Source: Bloomberg, Tiger Brokers

Key Highlights

◼ Last week, U.S. equities moved higher amid easing U.S.–China tensions and cooling inflation. Following the Kuala Lumpur meeting, both sides released positive signals, and September CPI data came in better than expected across the board. Markets now broadly anticipate that the Federal Reserve will cut rates by 25 basis points this week, temporarily alleviating macro risks. However, concerns over long-term inflation and technological rivalry remain. Tight liquidity and public fund rebalancing could amplify volatility, while corporate buybacks in November are expected to provide support. This week’s tech giants’ earnings will set the market tone — AI leaders may continue to outperform, with earnings and capital expenditures driving the next phase.

◼ The Greater China market staged a strong rebound last week, with both Hong Kong and A-shares leading global gains as sentiment and liquidity improved. Progress in U.S.–China negotiations eased trade tensions, while foreign capital inflows supported the rally. China’s Q3 GDP grew 4.8% year-on-year, with September industrial output up 6.5% and retail sales rising 3%, reflecting structural improvements in “manufacturing stability and consumption recovery.” The proposals for the 15th Five-Year Plan emphasize dual drivers of technology and domestic demand. With policy and capital resonating, the market’s structural recovery trend is expected to continue, favoring self-sufficient technology, infrastructure, and consumption sectors.

◼ This week’s key focuses include the Fed’s FOMC meeting and earnings from major tech firms such as Microsoft, Google, Meta, and Apple.

II. Key Market Themes

U.S. Market: Macro Risks Deferred but Not Disappeared, Investors Await AI Validation

Last week, U.S. equities climbed amid easing macro expectations and lingering structural risks. On one hand, the China–U.S. trade delegation reached a preliminary consensus at the Kuala Lumpur meeting over the weekend. U.S. representative Bessent stated that both sides had agreed on a framework and that Washington would not proceed with new 100% tariffs on Chinese goods, lifting short-term market sentiment. Meanwhile, after a partial government shutdown that lasted for more than two weeks, the U.S. finally released its macro data: September core CPI rose 0.2% MoM and 3.0% YoY, both below expectations. As a result, a 25-basis-point rate cut by the Fed this week now appears almost certain, easing near-term macro uncertainty.

However, the risks have only been postponed, not eliminated. Strategic competition between China and the U.S. over technology standards, semiconductor equipment, and supply chains remains intense. Moreover, both core inflation and long-term inflation expectations are still above the Fed’s target range, suggesting that the U.S. economy continues to face structural pressures that the market has yet to fully price in.

Source: tradingeconomics.com, University of Michigan,U.S. Bureau of Labor Statistics

From a liquidity perspective, this week marks the fiscal year-end for U.S. mutual funds, with roughly $2 trillion (about 23% of total AUM) potentially subject to “window dressing” and tax-driven rebalancing. Combined with market makers’ negative gamma positioning and thin futures liquidity, intraday volatility may become amplified. That said, as the earnings season deepens, corporate buybacks are expected to return, which should help improve liquidity conditions from November onward.

More importantly, about 60% of the S&P 500’s market capitalization will report earnings this week, including Microsoft, Google, Meta, Apple, and Amazon. Institutional (buy-side) expectations remain notably higher than those of the sell-side, indicating that investors fear missing out more than being disappointed. We expect AI-linked technology leaders to once again deliver upbeat results, supported by continued capital expenditure expansion. However, if cloud growth or operating margins underperform, renewed doubts over AI’s return on investment may reemerge. Still, for long-term investors, every wave of skepticism around AI represents a new buying opportunity. In summary, U.S. macro risks are deferred but not dissolved. In the short term, earnings and liquidity dynamics will dominate market fluctuations; in the medium term, AI profitability realization remains the key structural driver. The market is likely to find its new equilibrium amid heightened volatility.

Greater China: Entering a Phase of Structural Recovery Amid Internal and External Resonance

Last week, Greater China markets posted a strong performance, with both Hong Kong and A-shares advancing and overall risk appetite improving notably. The rally was primarily driven by two factors: a short-term easing in China–U.S. relations and structural improvements in domestic macro data. Following the Kuala Lumpur meeting, both sides signaled a willingness to de-escalate tensions in key areas such as rare earths, agricultural products, and trade, leading to a temporary reduction in extreme trade-risk expectations. Coupled with foreign capital inflows and institutional rebalancing, overall market liquidity showed visible improvement.

On the macro front, China’s Q3 GDP grew 4.8% YoY, broadly aligning with the annual target of “around 5%.” September industrial output rose 6.5% YoY and retail sales grew 3% YoY, both significantly beating expectations. Overall, the Chinese economy remains on a stable trajectory: the manufacturing sector maintains solid momentum, while the demand side is showing gradual recovery as consumer sentiment improves. The economic structure is thus transitioning from “strong manufacturing, weak consumption” to “stable manufacturing, recovering consumption.”

Source: Bloomberg

Policy and market dynamics are now working in tandem. The newly released “15th Five-Year Plan” proposal underscores technological innovation as the strategic core, emphasizing the development of a modern industrial system anchored in advanced manufacturing. At the same time, measures aimed at expanding domestic demand—such as improving social security, family support, and elderly care—are expected to foster a virtuous cycle between industrial upgrading and consumption recovery. Against this backdrop, foreign inflows have accelerated, and northbound capital recorded substantial net buying. Sectors tied to technology, self-reliance, and domestic demand have become the main investment themes. AI hardware, computing infrastructure, and high-end manufacturing continue to benefit from policy support, while consumption and services are rebounding alongside improving confidence. Hong Kong equities, supported by better liquidity and a stable RMB, have led the recovery as investors reprice the “Technology + Domestic Demand” dual-engine narrative.

In summary, under the combined forces of external easing and internal recovery, the Greater China market is entering a new phase of structural rebound. In the near term, sentiment is lifted by U.S.–China negotiations, while macro data confirms the coexistence of manufacturing resilience and consumption recovery. Over the longer horizon, the core investment logic lies in the intersection of technological self-sufficiency and domestic demand expansion. With policy alignment and capital inflows reinforcing each other, this trend is expected to strengthen further toward year-end.

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