China-U.S. Policy Brief (Oct 23): Beijing Unveils "AI Plus Employment" Plan, Fed Set to Hold Next Week, A-Shares Stage Intraday Comeback

U.S. Policy: Hold Expected Ahead of Oct 27-28 FOMC; First Russian Diesel Cargo Sets Sail

• Fed meeting Oct 27-28: In blackout with no official comments; Kalshi shows a 91% chance of holding rates in October and only 8% of a hike; December hike odds around 75%. The decision comes at 2:00 p.m. ET on Oct 28, with no SEP update. The 10-year Treasury yield stood at 5.00%, the 2-year at 4.69%; gold closed around $3,995.8 (down 4.05% for the week, the worst since early June); U.S. initial jobless claims fell to 194,000, a three-month low.
• First Russian diesel shipment: The Malta-flagged Agioi Fanendes left Russia's Primorsk port on Oct 22 carrying 40,000 tons of ultra-low-sulfur diesel, expected to reach the U.S. on Nov 7 — the first Russian petroleum product imports since the 2022 ban. U.S. average diesel price: $6.32 per gallon.
• Strait of Hormuz: Houthi drone strikes hit Saudi Aramco facilities; 7-day average tanker traffic fell to 8.5 million barrels/day; WTI closed at $103.22, Brent around $116.72.
• Anthropic S-1: The "final window" of Oct 23 passed with no confirmed public filing on EDGAR; the rumor remains unconfirmed. A Nov 9 roadshow would require disclosure 15 days prior.
• OpenAI fundraising: CNBC reports the company is nearing a round of up to $30 billion at a $1.25 trillion pre-money valuation (down from $1.4 trillion last month).
• AI credit warning: CoreWeave's 5-year CDS hit 1,065.84bp (implying a ~63% five-year default probability); U.S. tech firms have issued nearly $500 billion in new debt for AI infrastructure this year.
• U.S. stocks (Oct 23 close): Dow -1.23% to 52,215.16, S&P 500 -0.52%, Nasdaq -0.21%; American Express -3.7% after announcing 5% layoffs "to prepare for AI"; Meta fell 9.4% this week. Jensen Huang met Kazakhstan's president in Astana and proposed making the country a global "Physical AI" hub.

China Policy: "AI Plus Employment" Guideline; PBOC Announces MLF Operation

• State Council "AI Plus Employment" guideline (Oct 23, published): Six areas, 18 tasks — push the "AI Plus" initiative, place AI core industries in eastern regions and data-labeling/smart-terminal manufacturing in central and western regions, nurture AI-native companies and "little giant" champions; accelerate new AI occupations (digital managers, AI engineers, AI trainers); manage the pace of AI substitution in labor-intensive industries; improve social security for new employment forms and curb algorithmic discrimination and fake job ads.
• PBOC MLF operation: On Oct 26 the central bank will conduct a 700 billion yuan 1-year MLF operation — a smaller rollover (9 trillion yuan matures in October); mid-term liquidity still shows net injection for the fourth consecutive month. LPR unchanged for 17 straight months (1-year 3.0%, over-5-year 3.5%); Governor Pan announced diversified loan-pricing benchmarks (DR001 or LPR).
• Mortgage subsidy policy: The finance ministry said at an Oct 23 press briefing that the policy is "running smoothly with initial results" — but no official nationwide summary figures have been released yet. Terms: 1 percentage point annualized subsidy, up to 5 years, 1 million yuan per household, 90:10 central-local cost sharing.
• Economic data: Q1-Q3 GDP: Shanghai +5.5% (three leading industries' manufacturing output +17.1%), Shenzhen +6.0% (industrial robots +44.1%), Guangdong +4.6%. Tax authority invoice data: AI-related IC manufacturing Q3 revenue +77.9%.
• Embodied-intelligence robots: Commerce ministry said sales rose 22.6% in the first three quarters; six national standards for humanoid robots take effect April 1 next year.
• Trade-in subsidies: CCTV refuted rumors that the home-appliance subsidy is ending — it remains in place, with the full 250 billion yuan 2026 budget disbursed.
• Buyback wave: Seven listed firms announced buyback/increase plans today (Cambricon-chain supplier InnoLight: 0.8-1.0 billion yuan; Eoptolink: 100-150 million yuan); 131 firms have announced 29.9 billion yuan of plans since September (+292.04% year-on-year).

A-Share Watchlist (long-term, 5 names)

1. Baofeng Energy (600989, coal chemicals): Q1-Q3 revenue 47.09 billion yuan (+32.47%), net profit 14.32 billion yuan (+59.97%); 3 million t/yr coal-to-olefins project in Inner Mongolia fully ramped in April 2025, total olefins capacity 5.2 million t/yr. Risk: Q3 profit fell 24% sequentially as coal procurement costs rose.
2. Unitree Robotics (688836, humanoid robots): Hit the 20% daily limit at 624 yuan, market cap back above 250 billion yuan; up 54% in six trading days. Full policy tailwinds (new AI guideline, robot standards, +22.6% sector sales). Risk: The company warns the industry is in early commercialization with valuation-reversion risk.
3. Han's CNC (300830, PCB equipment): Q1-Q3 revenue 7.84 billion yuan (+100.90%), net profit 1.54 billion yuan (+214.03%); strong orders from 800G/1.6T optical-module mSAP substrates and HDI boards. Risk: Tied to AI capex cycle.
4. Lion Micro (605358, semiconductor wafers): Reported Q3 today — Q1-Q3 revenue 3.32 billion yuan (+25.79%), net profit 174 million yuan (back to profitability); Q3 net profit 90.2 million yuan (+373.03%). Risk: Gross margin still low (13.97%), fierce wafer price competition.
5. Honghe Technology (603256, electronic glass fabric): Q1-Q3 revenue 1.98 billion yuan (+131.65%), net profit 743 million yuan (+435.63%) on volume-and-price gains. Risk: Sensitive to downstream PCB cycle.

U.S.-Stock Watchlist (4 names)

1. Tesla: Q3 EPS $0.50 beat expectations; revenue flat at $28.05 billion; FSD subscriptions lifted auto gross margin to 18.1%; CLSA raised to Hold, price target $400. Risk: Deliveries down year-on-year; valuation still rich.
2. Meta: Down 9.4% this week after Q3 results — rising capex, negative free cash flow; analyst targets KeyCorp $905 / BofA $845. Risk: AI spending continues to squeeze free cash flow.
3. Nvidia: Closed at $212.21; Huang's Kazakhstan "Physical AI" proposal vs. his warning that neoclouds "lack operating capital"; no newly published analyst target today (pending verification). Risk: Tighter AI funding environment.
4. SpaceX (SPCX): First quarterly profit — revenue +161%, net income $4.4 billion, Super Intelligence revenue +830% to $7.56 billion; closed Friday at $147.495 (+1.9%). Risk: No public analyst target; Tesla-SpaceX merger study terms undecided.

For informational purposes only, not investment advice. By: AISTIM