To The Moon

After a challenging October, investors are entering November with a mixture of optimism and uncertainty. US technology stocks have started showing signs of recovery, while Hong Kong’s technology sector is still trying to regain investor confidence.

I think this creates an interesting investment question: should investors continue concentrating on US technology leaders, or could Hong Kong stocks offer better opportunities as valuations adjust?

Three developments deserve particular attention this month.

1. US Midterm Elections: Political Changes Could Influence Market Leadership

The US midterm elections are an important event for financial markets because political control can influence fiscal policy, technology regulation and government spending priorities.

However, I would be careful about making investment decisions based purely on election results.

For technology investors, the bigger concern is whether regulatory uncertainty could affect AI development, semiconductor exports and data centre expansion.

Companies with established global businesses and strong balance sheets may be better positioned to navigate policy changes.

I would continue watching the Nasdaq, particularly whether gains are spreading beyond a handful of mega-cap technology stocks.

A broader recovery would be a healthier signal than another rally driven by just a few companies.

2. NVIDIA: The Stock That Could Set the Direction for AI Sentiment

NVIDIA remains central to the global AI investment story.

Its competitive position in GPUs and AI computing gives it exposure to one of the fastest-growing areas of technology spending.

However, there is a growing challenge for investors: expectations are extremely high.

The market is no longer interested in revenue growth alone. Investors want evidence that AI infrastructure spending can generate sustainable returns.

I would watch NVIDIA’s data centre business, supply capacity and customer spending commitments.

Another strong earnings report could support semiconductor sentiment, but any indication that hyperscalers are slowing their investment plans could affect the entire AI sector.

AMD is also worth monitoring as an alternative supplier benefiting from the expansion of AI computing.

3. Ant Group: A Potential Catalyst for Hong Kong’s Financial Technology Sector

Ant Group remains an important name in China’s fintech industry.

Its proposed IPO was suspended in 2020, but the company continues to attract attention because of its position in digital payments and financial technology.

Any credible progress towards a future listing could renew interest in Hong Kong’s capital markets.

Alibaba is particularly relevant because of its ownership interest in Ant Group and its broader exposure to Chinese technology.

However, I would distinguish between IPO speculation and actual investment fundamentals.

For Alibaba, the more important questions are whether cloud revenue can accelerate, AI investments can generate commercial returns and its core commerce business can maintain profitability.

A potential Ant listing would be an additional catalyst, not the entire investment case.

4. Hong Kong Technology Stocks: Is There a Valuation Opportunity?

Hong Kong technology shares have faced considerable pressure, and this has made valuations an important consideration.

I would pay attention to Alibaba, Tencent and Meituan.

These companies operate in different segments, but all have established businesses and significant positions in China’s digital economy.

The key question is whether weaker share prices reflect deteriorating business fundamentals or simply a reduction in investor confidence.

If earnings stabilise and domestic economic sentiment improves, some companies could attract renewed institutional interest.

However, cheap valuations alone are not enough. Regulatory uncertainty, competition and slower consumer spending remain risks.

My November Watchlist and Strategy

My preferred stocks to monitor are:

• NVDA: AI infrastructure leadership and upcoming earnings.

• AMD: Growing competition in AI accelerators and data centre processors.

• BABA: Cloud computing, AI development and potential Ant Group-related developments.

• 0700.HK (Tencent): Gaming, advertising and AI monetisation.

• 3690.HK (Meituan): Consumer spending and competitive pressure in local services.

I would not buy all five simply because they are on my watchlist.

My preference is to prioritise companies with improving earnings prospects and reasonable valuations.

For US technology stocks, I would be more cautious about chasing momentum after strong rallies. For Hong Kong technology stocks, I would look for evidence that earnings and business conditions are improving before assuming a sustained recovery is underway.

Final Thoughts

November could provide opportunities in both markets, but I suspect market leadership may become more selective.

NVIDIA represents the strength of the global AI infrastructure cycle, while Alibaba and other Hong Kong technology companies offer exposure to China’s digital economy.

The interesting possibility is that investors may eventually look beyond the most expensive US technology stocks and reconsider companies trading at more attractive valuations elsewhere.

However, valuation discounts need to be supported by improving fundamentals.

For me, the most important signal this month will be whether earnings growth can become broad enough to support both US and Hong Kong markets.

I remain interested in AI and technology, but I would rather buy sustainable earnings growth at a sensible valuation than pay any price for the next popular investment theme.

For discussion purposes only.