China is experiencing an explosive growth of interest in AI chipmakers - after a historic 500% surge in Moore Threads' "Chinese Nvidia" shares, Baidu is preparing Kunlunxin for an IPO in Hong Kong with a valuation of almost $3 billion, intensifying the race for technological autonomy against the backdrop of U.S. export restrictions. U.S. Treasury debt surpassed $30 trillion for the first time. These and other topics are covered in our review of key events for the morning of December 5.
Shares of the Chinese chipmaker soared more than 500% on IPO day
AI chip developer Moore Threads, dubbed China's Nvidia, made its stock market debut in Shanghai, with shares soaring more than 500% and the company raising 8 billion yuan ($1.13 billion) - the country's second-largest IPO this year, Bloomberg reports. Demand was record-breaking, with the retail quota oversubscribed more than 2,700 times, the agency points out.
The company will use the raised funds to develop graphics processors and AI chips. The growing interest of investors is connected with Beijing's course on technological autonomy and Nvidia's withdrawal from the Chinese market, Bloomberg notes. At the same time, analysts fear possible overvaluation of the sector, although a successful listing may open the way for other Chinese chipmakers planning to enter the market.
Baidu chipmaker Kunlunxin prepares to make its debut in Hong Kong
Chinese AI chip developer Kunlunxin, spun off from Baidu, is planning an IPO in Hong Kong after a recent round of investment that valued the company at 21 billion yuan ($2.97 billion), sources told Reuters. Kunlunxin expects to apply for a listing as early as the first Ma of 2026 and go public by 2027.
The company is actively expanding sales, expecting revenue growth of more than 3.5 billion yuan this year and reaching break-even. In November, it unveiled new products - AI chips M100 (scheduled for launch in 2026) and M300 (in 2027), intensifying competition among Chinese manufacturers.
U.S. government debt in Treasury securities exceeds $30 trillion for the first time
The volume of U.S. Treasury securities exceeded $30 trillion for the first time, doubling since 2018, Bloomberg writes. The surge is attributed to pandemic borrowing and rising rates that have sharply increased the cost of debt service. In 2020, the U.S. borrowed $4.3 trillion as the deficit topped $3 trillion, and while it has since fallen to $1.78 trillion, the cost of debt service has reached $1.2 trillion, the agency explains.
Experts note that even the growth in duty revenues will not offset the scale of interest payments: "We're sinking slower, but we're still sinking," argues Jason Williams, interest rate strategist at Citigroup. The Treasury is already looking at future expansions of long paper auctions. Total U.S. government debt has reached $38.4 trillion, close to the $41.1 trillion limit.
India's central bank cuts rate to 5.25%
India's central bank cut its key rate by 25 basis points to 5.25%, unanimously noting a weakening of several economic indicators despite moderate inflation and strong GDP growth of 8.2% between July and September, CNBC reports. Industrial activity fell to a 14-month low in October, the PMI fell to a nine-month low, and U.S. exports fell for the second consecutive month. Washington's imposition of 50 percent duties has hit foreign trade. In addition, the rupee weakened, breaching the 90 per dollar mark.
Economists warn that while inflation is under control, slowing global trade and duty pressures are already taking their toll on the economy, with bank lending barely responding to policy easing. The opacity of negotiations on a trade agreement with the U.S. is adding to uncertainty, adding risks to the second half of the fiscal year, the channel points out.
What's in the markets
- Japan's broad Topix index fell 1 percent, while the Nikkei 225 fell 1.1 percent.
- Hong Kong's Hang Seng Index was little changed, while mainland China's CSI 300 index rose 0.2 percent.
- In South Korea, the Kospi index added 1.5%, while the Kosdaq lost 0.6%.
- Australia's S&P/ASX 200 rose 0.2 percent.
- Futures on the S&P 500 rose 0.2%, futures on the Nasdaq Composite - 0.4%. Exchange-traded contracts on the Dow Jones Industrial Average were almost unchanged.
This article was AI-translated and verified by a human editor
