HONG KONG: China stocks ended higher on Thursday, as tech shares resumed their record-breaking rally spurred by chip giant Micron’s blowout earnings. Hong Kong shares closed at a one-year low.
China’s blue-chip CSI300 index was up 1.6 percent, while the Shanghai Composite index ended 0.2 percent higher at 4,120.28 points.
Micron’s strong earnings and guidance alleviated market concerns and re-ignited the red-hot AI rally.
The CSI Semiconductor Index gained 3.3 percent and the CSI AI Index was up 3.7 percent. Tech-focused STAR50 Index jumped nearly 4 percent to a new record high.
Chipmaker GigaDevice jumped 10 percent, Naura Technology added 3.6 percent and SMIC gained 3.6 percent, all hitting fresh peaks during the session.
“The up-cycle in the overseas AI industry has yet to show signs of turning, and the structural trend of concentrated buying is unlikely to end any time soon,” analysts at Green Fund said in a note.
Although volatility in richly valued technology stocks may intensify in the short term, the medium- to long-term growth trends in key themes such as computing-power chips, semiconductor equipment and advanced packaging remain intact, they said.
“We remain positive on China’s AI tech hardware names for the rest of the year given strong earnings momentum, fervent retail participation and fresh capital from new IPOs which would add further fuel for the AI build-out,” James Wang, head of China strategy at UBS Investment Bank Research said.