Recently, the performance of Chinese and US tech stocks has shown a clear divergence. The direct trigger behind this is the potential sanctions risk represented by the US FCC, which has raised concerns about future fundamentals, leading to valuation compression. At the same time, the still-crowded trading structure in the A-share market has added fuel to the fire.

After a significant correction in A-share tech stocks, prices and valuations have somewhat reflected investors' concerns about future fundamentals, but it is hard to say they have fully priced it in: A-share tech valuations are still not cheap enough, and are even higher than US stocks. (1) From the perspective of their own valuation levels, the PE TTM valuation percentiles of growth sectors represented by optical modules, PCB, and computing power chips are still above 60%, while PB valuation percentiles are even higher, all still above 85%. Although dynamic valuations may be reasonable and ROE levels have already improved, this also means higher requirements are placed on future fundamental assumptions, and the basis for these assumptions is facing various uncertainties. (2) Compared with US stocks: current A-share tech valuations are still higher than US stocks, with PB slightly higher and PE far higher. By subsector: the PB valuations of A-share optical modules/PCB are still far above US stocks; the PE valuation of A-share AI chips is far above US stocks. Chinese tech stocks' past extreme scarcity and prosperity relative to the A-share market was the driving force behind their past excess returns and faster valuation increases; but during the global tech narrowing period, it has also become a hidden concern for future performance from the perspective of horizontal global tech stock comparison.

Current US stocks are also beginning to face their own problems after hitting new highs: profits are starting to diverge due to differences in calculation standards, represented by OpenAI's revenue ($50 billion vs $70 billion). Although optimists and pessimists each hold their own views, what is clear is that the future trajectory of US AI tech stocks also carries significant uncertainty. We discuss scenarios: First, if the fundamentals of US tech stocks are proven to be fine, then stock prices will return to strength. For A-shares, we believe there may also be a recovery after a sharp decline, but the extent will not be too large, and it will likely be weaker than US stocks. The reasons are as follows: (1) The fundamental mapping relationship between Chinese and US tech stocks has weakened. The core reason is that US tech stocks have shifted from siphoning global investment funds to profit redistribution after focusing on future returns, allowing profits from the global AI industry chain to flow back to the US to support longer-term investment needs. This is an inevitable choice in a scenario of scarce overseas profit retention. Therefore, although the FCC has not yet taken effect, as long as it has not been implemented, it will create fundamental expectation pressure on Chinese sectors entering the US industry chain, represented by optical modules. (2) Trading-level issues have still not been fully digested. On Friday (2026-10-09), A-share tech stocks showed a clear rebound after a sharp decline, mainly due to ETF/market stabilization funds entering to support the market, because the margin guarantee ratio has returned to near previous lows, and the necessity for market stabilization is rising. But even so, the concentration of mutual fund holdings plus contrarian operations is the biggest factor constraining the rebound: since the end of July, during the weak rebound in tech stocks, mutual funds have shown clear contrarian operations in the electronics and communications sectors that they heavily held in Q2, namely reducing positions on rebounds and slightly adding on declines.

Second, if the fundamentals of US tech stocks also run into problems, under a declining trend in US tech stocks, A-share tech stocks may find it even harder to stay insulated, and at that point Chinese and US tech stocks may begin to move in the same direction. In this case, the siphon effect of US AI on global capital will decline, upward pressure on real interest rates will ease, and combined with a sharp drop in October rate hike expectations, pressure from rising nominal rates will also ease. At that time, the opportunity for gold allocation may instead arrive. OpenAI's signal of slowing revenue syncing again with the recent slowdown in real rate increases may be important validation of this scenario. So from the current perspective, holding a combination of US AI tech stocks plus gold may be a relatively prudent choice. But for domestic investors, A-share tech stocks' own problems have not been completely resolved. At this time, the energy sector, which has lower sensitivity to interest rates and dividend attributes, becomes a better substitute. Energy plus gold may be a better combination for A-share investors.

Against the backdrop of high overseas interest rates plus China-US tech divergence, in addition to energy plus gold, for investors who do not want to leave or cannot leave the market, domestic demand is also a potential hedging area: (1) On the one hand, after years of continuous adjustment, the dividend yield of the consumer sector has become quite considerable, and even some subsectors' dividend yields have surpassed banks. (2) On the other hand, policy has also been actively intensifying recently: on Friday, the Ministry of Finance issued the "Ministry of Finance Arranges the Use of 550 Billion Yuan of Local Government Debt Balance Limit" and the "Report on the Implementation of China's Fiscal Policy in the First Half of 2026," setting the tone of "increasing countercyclical adjustment efforts and boosting domestic demand." It is expected that infrastructure physical work volume will accelerate in the fourth quarter, providing some support for domestic demand. Nevertheless, there are also some concerns about domestic demand: September PMI data showed strong supply and weak demand, and the weakening of reality may not be over, which constrains the sustainability of stock price performance.

Since we proposed active defense, the market has clearly cooled; since we proposed comprehensive defense, market temperature has further declined. The difference between active defense and comprehensive defense is that the former recognizes market risks but is still looking for assets with excess returns, while the latter focuses on asset allocation to guard against downside risks. For overseas investors, holding US tech plus gold can still achieve effective hedging, but this does not hold for domestic investors. Gold is the dominant asset in the next scenario, and what can be sought now is the energy chain where demand has low sensitivity to interest rates and supply-side changes have been significant. Based on this, we recommend: First, the energy and chemical chain represented by oil, oil shipping, and coal will continue to benefit from global restocking demand for energy, while also being assets with dividend attributes. Second, against the backdrop of a slowing trend in the AI industry and divergence in fundamentals, combined with a sharp drop in October rate hike expectations and gradually easing pressure from real interest rates, gold is welcoming an allocation opportunity.

Risk warning: Domestic economic recovery may fall short of expectations, and the overseas economy may decline significantly. Recent performance of Chinese and US tech stocks has shown a clear divergence: while the Nasdaq index hit a new high for the year, the ChiNext index hit a new low for the year, and while the Philadelphia Semiconductor Index recovered to previous highs, the STAR 50 returned to near the position before the April rally started. We believe this is not because current fundamentals have already run into problems, but rather because potential sanctions risk represented by the US FCC has led to valuation compression from concerns about future fundamentals, accompanied by crowding in the trading structure adding fuel to the fire.

After this round of adjustment, have domestic tech stock valuations been killed enough? We analyze from two dimensions: (1) From the perspective of their own valuation levels, the PE TTM valuation percentiles of growth sectors represented by optical modules, PCB, and computing power chips are still above 60%, while PB valuation percentiles are even higher, all still above 85%, so it is hard to say they have entered a relatively cheap range. (2) Compared with US stocks: we select representative leading tech companies in China and the US as analysis samples. From an overall valuation perspective, the PE and PB valuations of A-share tech stocks have already halved from their highs in this round, but US valuations have even declined while approaching new highs/rising. Therefore, current A-share tech valuations are still higher than US stocks, with PB slightly higher and PE far higher. By subsector: the PB valuations of A-share optical modules/PCB are still far above US stocks; the PE valuation of A-share AI chips is far above US stocks; the storage sector has the same valuation. Therefore, based on the above analysis, we can draw the following conclusion: at present, after a significant correction in A-share tech stocks, prices/valuations have somewhat reflected investors' concerns about future fundamentals, but have not fully reflected them: valuations are still not cheap enough, and are even higher than US stocks.

Current US stocks are also beginning to face their own problems after hitting new highs: on the one hand, high interest rates are suppressing valuations, so basically US stocks are only rising on earnings while valuations are even declining; on the other hand, profits are also beginning to diverge due to differences in calculation standards, represented by OpenAI's revenue ($50 billion vs $70 billion). Although optimists and pessimists each hold their own views, what is clear is that the future trajectory of US AI tech stocks also carries significant uncertainty. We discuss scenarios: First, if the fundamentals of US tech stocks are proven to be fine, then stock prices will return to strength. For A-shares, we believe there may also be a recovery after a sharp decline, but the extent will not be too large, and it will likely be weaker than US stocks. The reasons are as follows: (1) The fact that US tech stock fundamentals are fine does not mean the fundamental pressure on A-shares is lifted. The fundamental mapping relationship between Chinese and US tech stocks has weakened. The core reason is that US tech stocks have shifted from siphoning global investment funds to profit redistribution after focusing on future returns, allowing profits from the global AI industry chain to flow back to the US to support longer-term investment needs. Therefore, even if the fundamentals of US tech stocks continue to improve, what lies behind it is no longer a win-win situation under a bigger pie, but a process of dividing the pie of other non-US tech stocks under forward return requirements. So although the FCC has not yet taken effect, as long as it has not been implemented, it will create fundamental expectation pressure on Chinese sectors entering the US industry chain, represented by optical modules. (2) Trading-level issues have still not been fully digested. On Friday (2026-10-09), A-share tech stocks showed a clear rebound after a sharp decline, mainly due to ETF/market stabilization funds entering to support the market, because the margin guarantee ratio has returned to near previous lows, and the necessity for market stabilization is rising. But even so, the concentration of mutual fund holdings plus contrarian operations is the biggest factor constraining the rebound: since the end of July, during the weak rebound in tech stocks, mutual funds have shown clear contrarian operations in the electronics and communications sectors that they heavily held in Q2, namely reducing positions on rebounds and slightly adding on declines.

Second, if the fundamentals of US tech stocks also run into problems, under a declining trend in US tech stocks, A-share tech stocks may find it even harder to stay insulated, and at that point Chinese and US tech stocks may begin to move in the same direction. In this case, the siphon effect of US AI on global capital will decline, upward pressure on real interest rates will ease, and combined with a sharp drop in October rate hike expectations, pressure from rising nominal rates will also ease. At that time, the opportunity for gold allocation may instead arrive. OpenAI's signal of slowing revenue syncing again with the recent slowdown in real rate increases may be important validation of this scenario. So from the current perspective, holding a combination of US AI tech stocks plus gold may be a relatively prudent choice. But for domestic investors, A-share tech stocks' own problems have not been completely resolved. At this time, the energy sector, which has lower sensitivity to interest rates and dividend attributes, becomes a better substitute. Energy plus gold may be a better combination for A-share investors.

Against the backdrop of high overseas interest rates plus China-US tech divergence, in addition to energy plus gold, for investors who do not want to leave or cannot leave the market, domestic demand is also a potential hedging area: (1) On the one hand, after years of continuous adjustment, the dividend yield of the consumer sector has become quite considerable, and even some subsectors' dividend yields have surpassed banks. (2) On the other hand, policy has also been actively intensifying recently: on Friday, the Ministry of Finance issued the "Ministry of Finance Arranges the Use of 550 Billion Yuan of Local Government Debt Balance Limit" and the "Report on the Implementation of China's Fiscal Policy in the First Half of 2026," setting the tone of "increasing countercyclical adjustment efforts and boosting domestic demand." It is expected that infrastructure physical work volume will accelerate in the fourth quarter, providing some support for domestic demand. Nevertheless, there are also some concerns about domestic demand: September PMI data showed strong supply and weak demand, and the effect of policy stimulus on demand still needs further observation.

Since we proposed active defense, the market has clearly cooled; since we proposed comprehensive defense, market temperature has further declined. The difference between active defense and comprehensive defense is that the former recognizes market risks but is still looking for assets with excess returns, while the latter focuses on asset allocation to guard against downside risks. For overseas investors, holding US tech plus gold can still achieve effective hedging, but this does not hold for domestic investors. Gold is the dominant asset in the next scenario, and what can be sought now is the energy chain where demand has low sensitivity to interest rates and supply-side changes have been significant. Based on this, we recommend: First, the energy and chemical chain represented by oil, oil shipping, and coal will continue to benefit from global restocking demand for energy, while also being assets with dividend attributes. Second, against the backdrop of a slowing trend in the AI industry and divergence in fundamentals, combined with a sharp drop in October rate hike expectations and gradually easing pressure from real interest rates, gold is welcoming an allocation opportunity.

Risk warning: Geopolitical conflicts continue to escalate: if geopolitical conflicts continue to escalate, oil price shocks will persist, and inflationary pressure will bring tightening expectations, which would be inconsistent with the interest rate assumptions in this article. The AI industry trend achieves a major breakthrough: if the AI industry trend achieves a major breakthrough, the market will return to the tech mainline, and defensive thinking will no longer apply. This message is reprinted from a Sina partner media outlet. Sina publishes this article for the purpose of conveying more information and does not mean it agrees with its views or confirms its description. The article content is for reference only and does not constitute investment advice. Investors operate at their own risk based on this information.