Shanghai stock benchmark reclaims 4,000 level on domestic chip optimism
- The Shanghai Composite index was up 0.9% at 4,004.25 points
HONG KONG: Shanghai’s benchmark stock index reclaimed the psychologically important 4,000 level on Thursday, as optimism over tech self-sufficiency boosted semiconductor and artificial intelligence-related shares.
At the midday break, the Shanghai Composite index was up 0.9% at 4,004.25 points. The blue-chip CSI300 index was up 1.3%.
The Chinese government has issued guidance requiring new data centre projects that have received any state funds to only use domestically-made AI chips, Reuters reported.
This could be one of China’s most aggressive steps yet to eliminate foreign technology from its critical infrastructure and achieve its quest for AI chip self-sufficiency.
Tech sectors led the gains. The CSI Semiconductor Industry Index rallied more than 4%, with China’s top chip maker SMIC up 3.9% and Cambricon Technologies rising more than 6%.
The CSI AI sector index and the info tech sector both gained roughly 2%.
“Fresh optimism about China’s chip self-sufficiency and upcoming technological breakthroughs would continue to support the entire sector’s performance despite the rich valuation. There’s more upside to go,” said Kenny Ng Lai-yin, securities strategist at China Everbright Securities International.
In Hong Kong, the benchmark Hang Seng Index was up 1.6% at 26,361.40. The Hang Seng Tech Index jumped more than 2%.
Cathay Pacific Airways touched a three-month high after announcing it was buying back the entire remaining stake from Qatar Airways.
Pony AI and WeRide slid as the Chinese autonomous-driving developers started trading in Hong Kong.
Investors are also awaiting China’s October trade data, due on Friday. Forecasts compiled by Reuters show that exports denominated in US dollars likely slowed to a year-on-year growth rate of 3.0%.