China: An Equity Strategist’s Diary (H/A): Weekly wrap (11-15 May): AI trades reverse amid yield breakout; muted summit

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China: An Equity Strategist’s Diary (H/A): Weekly wrap (11-15 May): AI trades reverse amid yield breakout; muted summit

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China: An Equity Strategist’s Diary (H/A)

Weekly wrap (11-15 May): AI trades

reverse amid yield breakout; muted summit

Equity Strategy

Weekly index performance, Wax & Wane (W&W) indicator 18 May 2026

HSCEI -2.2%/CSI 300 -0.3%: Choppy price action persisted early in the week, with Equity Strategy

positioning increasingly crowded in AI themes alongside elevated turnover and margin China

trading. However, a strong open on Thursday quickly faded, giving way to a sharp unwind

in tech and a broader risk-off into Friday as the Trump–Xi summit concluded. The Table of Contents

correction aligned with a less supportive macro backdrop, with global bond yields

Indices vs RRR cut 2

breaking higher and oil price rising. The leadership summit itself was broadly in line with

Key themes update 3

muted expectations, aside from a brief sentiment uptick following Nvidia CEO Jensen

Huang’s late addition to the delegation. Materials, healthcare, and comm. services Market movements and capital flows 4

underperformed the most while utilities, real estate, and energy outperformed the most. Southbound weekly flow 5

Our W&W indicator reached 33 in the bullish zone on Thurs. Weekly and monthly average China Positioning 6

reached 23 and 30, both in the bullish zone (see chart on page 18). Earnings revisions 7

Macro: top weekly headlines & upcoming highlights Recovery trends 8 Key events 9

Week of May 18: Mon, Apr industrial production, retail sales, FAI and new home prices;

Key news 10

Wed, May 1Y & 5Y LPR; Trump-Xi summit: US, China forged ‘constructive strategic