Daily Buzz: 26 October 2026

Moonshot Limits Model Capabilities That Could Help Hackers

Chinese AI startup Moonshot announced it has reduced the cyber-offensive capabilities of its newest model, amid growing global fears that increasingly autonomous artificial intelligence could increase hacking.

Beijing-based Moonshot announced the curbs on Saturday, while introducing Kimi K3.1 Pro, which it describes as its most capable 3-trillion-parameter-class, open-weight model. Governments, technology companies and security researchers are growing increasingly concerned that AI could make sophisticated hacking easier and cheaper, with models that write code, operate software tools and complete complex tasks helping "bad players" identify weaknesses in software programs and automate cyberattacks. China last week proposed export controls on AI-driven malware-generation and mutation technology. K3.1 ⁠Pro has a 1-million-token context window, allowing it to process very large amounts of text at once. Moonshot also released a faster version, K3.1 Pro Highspeed, which it said runs at two to three times the speed of the standard model.

Lula Wins Re-Election in Tight Brazilian Presidential Election

Incumbent Brazilian Luiz Inácio Lula da Silva, who came in second in the first round of a presidential election earlier this month, rebounded to win a runoff election on Sunday by a narrow 51.7 percent to 48.3 percent margin over right-wing challenger Flávio Bolsonaro. Leftist Lula, 80, is popular with unions and poorer residents, who have benefited from expanded social programs. He is also favored by environmentalists for reducing deforestation in the Amazon rain forest. It will be Lula's fourth term as president. Bolsonaro, 45, is the son of former president Jair Bolsonaro, who is currently under house arrest serving a 27-year prison sentence for plotting a coup after losing the 2022 election. His son has promised to pardon him and also pledged a crackdown on organized crime and drug traffickers, and big cuts in public spending. Lula has accused US President Donald Trump, an ally of the Bolsonaro family, of interfering in the election. Brazil, the largest country in South America, has about 159 million eligible voters and close economic ties with China.

Serbian Leader Concedes Defeat in Election With Record Turnout

Serbian's longstanding pro-Russian leader Aleksandar Vučić conceded defeat in Sunday's snap parliamentary election amid record-high voter turnout. He resigned as president last month after he called the election, seeking to become prime minister if his party won. The election follows two years of political turmoil fueled by student-led protests, allegations of official corruption and public outrage over the collapse of a concrete canopy at a major train station under repair by the government that killed 16 in 2024. Vučić's party has controlled the country since 2012.

US Warns Crunch Time Looming in Iran War, Oil Price Remains High

President Donald Trump said "decision time" is nigh on whether there is a peace deal with Iran or Washington resumes attacks. He earlier pledged no attacks in the runup to US midterm elections on November 3, where the war has become an issue because of higher energy prices feeding into the cost of living. His comments come as the US is reducing diplomatic and miliary personnel in the Middle East amid what the US says is intelligence pointing to attacks on Americans in the region by Iran and Iran-backed Houthi rebels in Yemen. Global benchmark Brent crude futures, which rose to a six-month high of US$117 a barrel on Friday, resumed trading Sunday night in New York priced at US$115.36.

Musk Says Starlink Access in Ukraine Fully Restored

SpaceX Chief Executive Elon Musk said Ukraine's full access to his Starlink satellite communications system has been restored. Musk, who earlier claimed disruptions were the decision of the US Defense Department, not his, now says the company restricted Ukraine's access to its high-speed technology because Kiev violated Starlink's terms of service by using it to kill people in drone strikes against Russia. Ukraine denies the allegation. Kiev relies on Starlink to direct drone operations strikes on energy infrastructure in Russia and issue public alerts about incoming Russian missiles.

China to Open Plenum on Party Discipline

The Communist Party's 20th Central Committee will open a four-day plenary session today. Its agenda covers the Politburo's work report and major issues related to sustaining strict Party discipline.

Top Business

China Sets Out Employment Safeguards for AI Deployment

China issued guidelines to support the adoption of artificial intelligent while protecting workers from unwarranted job losses. The directive calls for companies to conduct AI job-impact assessments and take a measured approach to AI deployment in labor-intensive industries, prioritizing applications in jobs facing labor shortages or hazardous conditions. They encourage companies to explore unemployment buffer periods, notify affected workers before large-scale AI deployment and provide support for retraining and job transitions.

At the same time, the guidelines support AI entrepreneurship, open-source development and new occupations in emerging industries.

EVE Energy Posts Profit Surge, Says Q4 Capacity Fully Booked

China's EVE Energy, a maker of batteries for electric vehicles, energy storage and consumer electronics, reported that third-quarter profit rose 60 percent to 1.9 billion yuan (US$289 million). Revenue increased 65 percent to 27.7 billion yuan. For the first nine months, profit rose 86 percent to 5.2 billion yuan on a 63 percent increase in revenue to 73.4 billion yuan. Management told investors that fourth-quarter production capacity is fully booked amid strong international demand, and output is expected to increase from the previous quarter.

Samsung, SK Hynix Q3 Earnings Due Out This Week

South Korea's Samsung Electronics and SK Hynix, the world's two biggest memory chipmakers, are expected to show increased profits this week when they report final third-quarter results, driven by sixth-generation high-bandwidth memory and rising prices for dynamic random-access memory. Analysts are forecasting that SK Hynix will report third-quarter revenue of 96.66 trillion won (US$72.9 billion) and operating profit at 75.97 trillion won. Samsung Electronics said in its preliminary results earlier this month that it posted revenue of 195 trillion won and operating profit of 107.4 trillion won. Its results this week will break down earnings by business segment. Market forecasts predict a possible loss of about 1 trillion won in Samsung's contract-chip manufacturing division.

China's First Regional Electricity Market Begins Formal Operations

China's southern regional electricity market has begun formal operations linking Guangdong, Guangxi, Yunnan, Guizhou and Hainan provinces under a unified set of trading rules after more than a year of trial operation. The market allows generators, electricity retailers, power users, energy-storage operators and virtual power plants to compete across provincial boundaries. Electricity from coal, hydropower, nuclear, wind, solar and gas plants trades under common rules, with spot prices updated every 15 minutes. The transition marks a step toward a unified national electricity market, allowing power resources to move more efficiently between regions with different supply and demand conditions.

First Fully AI-Animated Film Tests Public Acceptance

"Sanxingdui: Future Past," China's first fully AI-produced animated film to obtain a public screening license from the China Film Administration, grossed more than 500,000 yuan (US$75,000) in its first two days after opening last week. The 100-minute film, co-produced by Shenzhen-listed Bona Film Group, took two years to create and reportedly cost more than 10 million yuan. It explores themes of humanity in an AI-shaped future. Its box-office performance is being viewed as a test of whether audiences are willing to pay for AI-made movies.

Economy & Markets

China Warns US to Halt Further Restrictions on Outbound Investment

China's commerce ministry warned the US to stop expanding restrictions on American investments in China, saying they are discriminatory and disrupt trade ties. The admonition came after the US Treasury added Chinese biotechnology to its restricted sectors for outbound investment and comes as big US pharmaceutical makers have been expanding investments in Chinese drug discoveries. The US already restricts investments in Chinese semiconductors, quantum technologies and artificial intelligence. The ministry said in a statement that China reserves the right to take countermeasures, which weren't specified.

Chinese pharmaceutical and biotech companies are fast emerging as global competitors. So far this year, they have signed technology out-licensing deals with foreign countries valued at US$139 billion, accounting for eight of the world's 10 largest deals.

China's Active ETFs Raise US$2.25 Billion

China's first group of 18 actively managed exchange-traded funds (ETFs) attracted about 15 billion yuan (US$2.25 billion) in subscriptions in their October 23 launch last week, with three funds reaching their 2 billion yuan fundraising caps and closing early. The three funds, managed by E Fund Management, Fullgoal Fund Management and JP Morgan Asset Management, will allocate shares on a pro-rata basis after demand exceeded their initial limits. Several other funds also drew strong interest, with products from China Asset Management and Da Cheng Fund Management each raising more than 1 billion yuan on the first day, according to media reports. The funds were initially scheduled to close between this week. If all 18 reach their individual fundraising caps, they could channel up to 36 billion yuan into China's Class A share market.

China May Frontload US$470 Billion in Local Debt Issuance

China may soon announce an allocation of up to 3.12 trillion yuan (US$470 billion) in new local government debt quotas for 2027, allowing local authorities to prepare infrastructure and other investment projects beginning this year, according to analysts. The Finance Ministry said is working to enable some bond issues to begin as early as January. The government's 2026 quota is 5.2 trillion yuan. China has also approved an additional 550 billion yuan in local government bond issuance for the fourth quarter to support public services and investment.

Methodology Changes for Chinese Stock Indexes

The Shanghai Stock Exchange and China Securities Index Co announced revisions to the methodology of the Shanghai Composite Index, the SSE A-Share Index, the SSE Free Float Index and the STAR Composite Index, effective today. The revisions contain two elements: a new cap limiting any single constituent's weight to no more than 15 percent and moving up the removal date for risk-warning securities. The adjustments will affect the positioning arrangements of fund products and derivatives that track the indexes.

Corporate

Apple Foldable Phone Users Complain About Screen Durability

Apple's first foldable smartphone, the iPhone Duo that officially went on sale on Friday is running into pushback from consumers in China, the US, Japan and Australia complaining about the durability of its inner screen. One Australian user said the screen cracked about six hours after the device was unboxed. Replacing the inner display costs about US$1,200, about half of the phone's retail price. Apple has not yet issued an official statement on the possible defect.

CXMT Prioritizing Chinese Mainland Customers

Leading chipmaker ChangXin Memory Technologies (CXMT) has declined to quote Apple on dynamic random-access memory supply and has rejected a Taiwanese server maker seeking its DDR5 chips, according to Tech News, as the company prioritizes Chinese mainland customers. The company is running near capacity, with monthly wafer production capacity of about 320,000 expected to exceed 420,000 within a year. CXMT held 10 percent of the global DRAM market by revenue in the second quarter, ranking fourth behind Samsung, SK Hynix and Micron. The company earlier said it is moving into production of NAND flash chips.

Yuneng Holding Invests in Integrated Power Project

China's Yuneng Holding announced that its smart energy subsidiary plans to invest 13.9 billion yuan (US$2.1 billion) in the Puyang Integrated Energy Project, which involves coal-fired and wind power. The project is aiming to add 2,000 megawatts of coal-fired capacity and 1,200 megawatts of wind capacity.

TikTok US Operation Seeking More Computing Capacity

TikTok's US operating arm, now controlled by an Oracle-led American consortium, is exploring deals to secure several gigawatts of computing capacity over the coming years, according to CNBC with one source citing a target of four gigawatts by the early 2030s. The US platform runs mainly on Oracle cloud infrastructure. TikTok's Chinese parent ByteDance holds 19.9 percent of the US operation after a deal earlier this year that prevented the US government from closing down the platform on concerns about the privacy of user data. TikTok has over 200 million users in the US, where it is one of the most popular social media platforms.

Yichu Digital Energy Opens Subsidiary in Hong Kong

Shenzhen-based Yichu Digital Energy, backed by former parent Ganfeng Lithium, the world's biggest producer of the raw material vital in battery production, opened a Hong Kong subsidiary as it contemplates an initial public offering in the city next year. The new unit will focus on overseas business and cross-border energy asset investment, speeding up the export of China's energy storage technology. Yichu Digital has multiple large storage projects across the Chinese mainland.

Demingli Turns to Profit but Quarterly Growth Slows

Demingli, a Chinese memory chip maker, said its nine-month earnings turned to profit of 8.7 billion yuan (US$1.3 billion) from a year-earlier loss on strong growth in demand for memory chips. Revenue totaled 28.6 billion yuan, up 329 percent. However, profit of 2.7 billion in the third quarter rose only 2 percent from the prior three months. The company reported spending 478 million yuan on research and development.