I'm LongbridgeAI. Here is the key information I extractedA shift in the US political landscape, marked by the Democratic Party's landslide victory in the midterm elections, caused significant volatility in global stock markets. Capital flowed from Asian AI hardware stocks, particularly in South Korea, into undervalued Chinese tech stocks. Coupled with recent market-boosting measures introduced by mainland authorities, Hong Kong stocks recorded their largest single-day gain since February last year. Driven by the two heavyweight stocks, Alibaba (09988) and Tencent (00700), the Hang Seng Index rose as much as 952 points, or 3.98%, during the session, closing at 24,796 points, an increase of 877 points, or 3.67%.
The Hang Seng China Enterprises Index closed at 8,369 points, up 311 points, or 3.87%; the Hang Seng Tech Index closed at 4,154 points, up 218 points, or 5.55%; and the main board turnover for the day reached HK$356.6 billion. Mainland investors took the opportunity to take profits, with net outflows totaling HK$21.3 billion for the day. On the other hand, South Korean stocks plunged 5.28% for the day, with SK Hynix falling more than 9% and Samsung Electronics dropping nearly 8%.
The US midterm elections sparked a "blue wave," with the Democrats regaining control of both the Senate and the House of Representatives. Market expectations that the Democrats would push for a US withdrawal from conflicts involving Iran led to a sharp drop in international oil prices, cooling inflation expectations. Meanwhile, US President Trump's fiscal policies are expected to face greater constraints in the future. These two factors contributed to a decline in US bond yields.
Simultaneously, Texas, a traditional Republican stronghold, unexpectedly "flipped," with both the governorship and Senate seats going to the Democrats. Texas is a major hub for AI data centers in the US, but the governor-elect advocates for tighter regulation of data centers and the removal of preferential policies, which is likely to hit local data center infrastructure projects. Amid a reshaping of financial market narratives, Asia-Pacific capital rotated from Japanese and South Korean markets into Chinese stocks. At the same time, funds withdrew from AI concept stocks, turning their attention to value stocks and consumer stocks.
Internet platform stocks rebounded strongly: Tencent (00700) rose more than 7%; Alibaba (09988) gained about 8.5%; Baidu (09888) increased by over 5%; Meituan (03690) rose nearly 7%; KUAISHOU-W (01024) advanced 5%; and XIAOMI-W (01810) climbed nearly 9%. AI hardware stocks suffered setbacks: LENOVO GROUP (00992) plunged as much as approximately 11.5%, closing down nearly 7%, making it the blue-chip stock with the largest decline for the day; KB LAMINATES (01888) fell more than 12%; and Zhongji Innolight (03308) dropped over 6%.
The retreat of the US dollar benefited gold prices, boosting gold-related stocks: ZIJIN GOLD INTL (02259) rose nearly 5%; ZIJIN MINING (02899) gained more than 3%; ZHAOJIN MINING (01818) increased by nearly 6%; and CHIFENG GOLD (06693) rose 4%. LAOPU GOLD (06181) surged more than 8%, marking the largest half-day gain among blue-chip stocks; CHOW TAI FOOK (01929) rose nearly 3%.
Financial stocks also performed well: HSBC HOLDINGS (00005) rose more than 4%; STANCHART (02888) gained nearly 4%; and AIA (01299) advanced over 2%.