On May 14th, domestic semiconductor stocks experienced a volatile session, initially rising before retreating. The HUABAO SHANGHAI SCI TECH INNOVATION BOARD CHIP TRADING OPEN ENDED INDEX SECURITIES INVESTMENT FUND (589190), which provides comprehensive exposure to the chip industry, touched a new intraday high in early trading before falling over 2%. It subsequently staged a V-shaped recovery, briefly turning positive, highlighting the sector's robust underlying momentum.
Semiconductor materials performed exceptionally well. China State Shipbuilding Corporation Special Gas Co., Ltd. surged, marking its third significant gain in four sessions, while Tianyue Advanced Materials Co., Ltd. hit a 20% daily limit, both reaching new all-time highs. Computing power chip stocks saw short-term fluctuations, with Hygon Information Technology Co., Ltd. down 5% and Cambricon Technologies Corporation Ltd. declining over 3%.
Overseas, U.S. chip stocks mounted a strong rally overnight. NVIDIA Corporation led the charge, propelling the Nasdaq Composite to a fresh record high, while the Philadelphia Semiconductor Index rose more than 2%. According to Taiwan Semiconductor Manufacturing (TSM), the global semiconductor market is projected to exceed $1.5 trillion by 2030, a 50% increase from its previous forecast of $1 trillion. Artificial intelligence and high-performance computing are expected to account for 55% of this total market.
Domestically, Frost & Sullivan forecasts that China's AI chip market will surge from RMB 142.5 billion in 2024 to RMB 1.34 trillion. The compound annual growth rate from 2025 to 2029 is projected at 53.7%, significantly outpacing the global growth rate for the same period.
A research report indicated that memory chips and modules are experiencing an earnings surge, with price increases expected to continue. Semiconductor equipment earnings are maintaining rapid growth, accelerated by domestic substitution. Demand for domestic computing power remains robust, alongside breakthroughs in advanced process technologies. Supply chain companies have reported Q1 2025 and Q1 2026 earnings that consistently exceed expectations, with continued optimism for AI computing hardware, the memory super-cycle, and semiconductor self-sufficiency.
Regarding market dynamics, the report noted that while the concentration level, measured by the trading volume of the top 5% of stocks relative to total volume, is approaching levels seen before the market adjustment in late September 2025, the forward price-to-earnings ratios for the technology sector remain notably lower than at that time. This is attributed to stronger-than-expected earnings significantly digesting valuations and analysts raising long-term profit forecasts amid technological iteration, leaving certain segments within the tech sector, particularly in applications and chip manufacturing, appearing relatively undervalued.
For investors seeking exposure to the chip industry's "super-cycle," high-beta instruments are a preferred choice. Public information shows that the HUABAO SHANGHAI SCI TECH INNOVATION BOARD CHIP TRADING OPEN ENDED INDEX SECURITIES INVESTMENT FUND (589190) and its feeder funds track the SSE STAR Market Chip Index. It offers a balanced, full-chain allocation to the chip industry, with over 90% weight in core segments like integrated circuits and semiconductor equipment, representing high concentrations of hard technology and strong technical barriers.
Data Sources: Shanghai and Shenzhen Stock Exchanges, etc. ETF Fee Note: When subscribing for or redeeming fund shares, subscription/redemption agents may charge a commission of up to 0.5%, which includes relevant fees charged by stock exchanges and registration institutions. Feeder Fund Fee Note: For HUABAO SHANGHAI SCI TECH INNOVATION BOARD CHIP ETF FEEDER FUND A, the front-end subscription fee is RMB 1,000 per transaction for subscription amounts of RMB 2 million or more, 0.2% for amounts between RMB 1 million (inclusive) and RMB 2 million, and 0.5% for amounts below RMB 1 million. The redemption fee is 1.5% for a holding period under 7 days and 0% for 7 days or more. HUABAO SHANGHAI SCI TECH INNOVATION BOARD CHIP ETF FEEDER FUND C charges no subscription fee. Its redemption fee is 1.5% for a holding period under 7 days and 0% for 7 days or more, with a sales service fee of 0.2%. Risk Disclosure: The HUABAO SHANGHAI SCI TECH INNOVATION BOARD CHIP TRADING OPEN ENDED INDEX SECURITIES INVESTMENT FUND passively tracks the SSE STAR Market Chip Index. The index base date is December 31, 2019, and its release date is June 13, 2022. This product is issued and managed by HUABAO Fund Management Co., Ltd. Selling agencies do not assume responsibility for the product's investment, payment, or risk management. Investors should carefully read the Fund Contract, Prospectus, Fund Product Key Facts Statement, and other legal fund documents to understand the fund's risk-return characteristics and select a product suitable for their own risk tolerance. The fund manager assesses this fund's risk rating as R4 - Medium-High Risk, suitable for investors with a suitability rating of C4 or above. The performance of other funds managed by the fund manager does not guarantee this fund's performance. Past performance of the fund is not indicative of its future results. Funds carry risks; investment requires caution. Selling institutions (including the fund manager's direct sales channels and other sales agencies) evaluate this fund's risk according to relevant laws and regulations. Investors should promptly pay attention to the suitability opinions issued by the fund manager. Suitability opinions from various sales agencies may not be consistent. The fund product risk rating results issued by fund sales agencies shall not be lower than the risk rating results determined by the fund manager. The description of the fund's risk-return characteristics in the fund contract and its risk rating may differ due to different considerations. Investors should understand the fund's risk-return profile and, considering their own investment objectives, horizon, experience, and risk tolerance, prudently select fund products and bear the risks themselves. The China Securities Regulatory Commission's registration of this fund does not indicate a substantive judgment or guarantee of its investment value, market prospects, or returns. Funds carry risks; investment requires caution.
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