Tesla’s Cybercab investigated, and Microsoft and OpenAI sued

Shortly after launching in Austin, Texas, the US government is investigating Tesla’s Cybercab over the company’s decision not to apply for exemptions that other robotaxi makers require.

Two publications have sued OpenAI and Microsoft for allegedly using copyrighted articles to train their AI models.

In global markets, investors seeking to diversify beyond crowded AI trades in Korea and Japan are increasingly seizing on Chinese equity derivatives.

Trading desks from Barclays Plc to UBS Group AG are seeing rising client demand for bullish options and swap contracts tied to China’s CSI indexes in recent weeks.

Meanwhile, more strategists are recommending derivative trades to position for gains, particularly in the mid- and small-cap space.

Key drivers for Chinese stocks include ongoing capital‑market reforms that support a gradual bull market, advances in self‑reliant technology and an improving earnings outlook across hardware sectors, according to BNP Paribas SA and Bank of America.

In a recent report, UBS highlighted the CSI 500 as an alternative artificial intelligence bet for investors looking to diversify their exposure.

Yet even as optimism creeps back in, traders remain cautious about the nation’s economic outlook and government support.

The CSI 1000 Index, up after posting its worst monthly loss since 2016 in July, is still 16% below its high in May.

Meanwhile, implied volatility — the gauge of options prices — has slumped back toward its one-year average, making derivative bets more appealing.

“It’s an ideal trade now because people are a bit on edge,” said Lars Naeckter, head of Asia Pacific equity-derivatives research at Bank of America. He recommends call spreads on the CSI 1000.

“Rather than piling into cash equities or futures, options make sense, especially when pricing is in your favour.”

“At some point, a catalyst will emerge, and it is often cheaper to be tactically proactive ahead of a move rather than reactive.”

The growing importance of tech in Chinese indexes is helping attract investors as the government pushes for the industry’s self-reliance, according to BNP Paribas.

It’s become the highest-weighted sector for the CSI 300 Index, and it’s increased for the mid- and smaller-cap CSI 500 and CSI 1000 gauges.

In the US, on Friday, a trader bought a huge block of bullish calls on the KraneShares CSI China Internet Fund, betting it would return to prices seen earlier this year.

China onshore offers a very different exposure to AI due to the nation’s own ecosystem. So there is a natural diversification compared to the global AI trade,” said Jason Lui, BNP Paribas’s head of Asia-Pacific equity and derivatives strategy.

“Now, having that more well-contained volatility profile also encourages more medium-term asset allocation from both domestic and international institutional investors.” [Bloomberg]

5 important things happening in tech today

Tesla Cybercab investigated: Tesla’s self-driving Cybercab recently launched in Austin, Texas, and it is already under investigation by the US government. The National Highway Traffic Safety Administration is examining the brand’s decision not to seek an exemption required by other robotaxi producers. [Wired]

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Microsoft and OpenAI sued for copyright infringement: Microsoft and OpenAI are being sued by the Seattle Times and Newsday, who allege that the companies used copyrighted articles to train AI models by bypassing paywalls. The publishers say this has reduced website traffic and advertising revenue. [Engadget]

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**Microsoft enabling Memory Integrity on more Windows 11 PCs: **Microsoft is expanding the Memory Integrity security feature to more Windows 11 PCs, starting in October 2026. Eligible systems will enable it automatically. The feature protects against malicious code, but also reduces gaming performance on some hardware. [Digital Trends]

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OpenAI rethinking what to do when its AI goes rogue: OpenAI acknowledged an incident in which its AI agents made more than 15,000 unauthorised edits on a German programming wiki. The agents used it to share methods for bypassing restrictions and avoiding technology. As a result OpenAI is developing a framework for disclosing unexpected AI behaviour. [Digital Trends]

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**Hikers rescued after taking bad advice from Google Gemini: **Rescuers saved three hikers on California’s Mount Shasta after using Google’s Gemini to plan their hike. They reached the summit 7 hours after the recommended turnaround time and became stranded overnight while descending. The sheriff’s office said Gemini told them to bring too little food and water. [TechCrunch]

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