On Friday (July 24th), the market underwent a period of consolidation, with all major A-share indices closing in negative territory. The ChiNext Index and the Shenzhen Component Index both fell by more than 2%. The combined trading volume for Shanghai and Shenzhen markets reached 1.93 trillion yuan, marking a three-month low and a decrease of 264.2 billion yuan compared to the previous trading day.
Amidst this backdrop, the semiconductor equipment sector showed strength, moving higher against the broader market decline. A key catalyst is the upcoming listing of ChangXin Memory Technology on July 27th. As a primary focus for wafer foundry capital expenditure, semiconductor equipment stands to be the most direct beneficiary of ChangXin's capacity expansion through its IPO. The HUABAO SHANGHAI SCI TECH INNOVATION BOARD CHIP TRADING OPEN ENDED INDEX SECURITIES INVESTMENT FUND (589190), known for its relatively lower fee structure among its peers*, saw its intraday price climb nearly 3%. Meanwhile, the Electronic ETF (515260), which concentrates on popular themes like semiconductor equipment, storage chips, and advanced packaging, saw its intraday price rise by 1.34% after attracting 10.94 million yuan in capital the previous day.
With the reconstruction of intelligent computing infrastructure through super-nodes, domestic computing power is accelerating its breakthrough. The Sci-Tech AI ETF Huabao (589520), which focuses on the domestic AI industry chain, saw its intraday price rise by 1.6% and has attracted 49.14 million yuan in the last 10 days. The Huabao Tech ETF (515000), which combines hard-tech beta with high-quality leader alpha characteristics, briefly turned positive, rising over 1% during the session. Its weekly line turned positive, ending a three-week losing streak.
Notably, the Huabao HK Connect Information Technology ETF (159131), which features a portfolio of Hong Kong stocks with an 85% hardware and 15% software allocation, has seen net capital inflows for three consecutive days, totaling 550 million yuan. Over a longer timeframe, it has amassed a staggering 1.893 billion yuan over the past 60 trading days.
How to Interpret the Recent Market Volatility?
Regarding the recent market fluctuations, Guosen Securities pointed out that historically, a shift from a bull to a bear market is driven by a deteriorating macro environment and overheated market sentiment. Since the "9·24" market rally, the macro environment has not changed, nor has sentiment overheated. As inflation gradually recedes and midterm elections approach, expectations for a US Federal Reserve rate hike are likely to cool down. Furthermore, the trend of resident funds entering the market is accelerating, suggesting the A-share market rally that began on September 24th may still have room to develop. The current decline is attributed to overseas volatility and is seen as a normal correction. As overseas disturbances subside, the critical window for positioning in the second half of the year may have already arrived.*
In terms of allocation, China Merchants Securities suggests focusing on two themes for bottom-fishing: semi-annual report performance and industry trends. For semi-annual reports, look for sectors with high or significantly improved earnings growth, such as the TMT price-increase chain, resource products where supply-demand dynamics lead to volume-price resonance, and sectors driven by exports and overseas expansion like batteries, medical devices, innovative drugs, and aerospace equipment. The recent adjustment in overseas computing power is primarily due to liquidity disturbances. The industry flywheel formed by cloud provider capital expenditure, large model iterations, and AI application penetration has not stopped, and a recovery along the lines of performance certainty is expected. Domestic computing power, supported by autonomous control, the adaptation of domestic models and servers, and infrastructure upgrades like super-nodes, remains an industrial theme worthy of medium-term allocation.*
ETF Focus Market Close Review
This section discusses the trading and fundamentals of industry-specific ETFs such as the Sci-Tech Chip ETF and the Tech ETF.
1. Sudden Intraday Surge: Low-Cost Sci-Tech Chip ETF (589190) Rises Nearly 3% Against the Trend. ChangXin Memory's Monday Listing – What's the Impact?
The Sci-Tech Chip sector showed strength against the market, experiencing a sudden intraday surge. The lower-cost HUABAO SHANGHAI SCI TECH INNOVATION BOARD CHIP TRADING OPEN ENDED INDEX SECURITIES INVESTMENT FUND (589190) saw its price spike nearly 3% before settling, ultimately closing 0.44% higher.
Leading the gains were semiconductor materials and equipment, along with chip design companies. CSIC Peric Special Gas surged over 14%, Aojie Technology-U rose over 8%, Southchip Semiconductor gained over 7%, and Zhongke Feice, Piotech, Amlogic, and Montage Technology were among the top performers.
On the trading floor, strong earnings reports remain a key catalyst. Driven by the rapid iteration of AI and high-end memory chip industries, which has led to a surge in demand for the key semiconductor consumable tungsten hexafluoride, CSIC Peric Special Gas experienced explosive revenue growth in this segment, nearly tripling its revenue and achieving a 95.63% net profit increase in the first half of the year. Amlogic expects its net profit for the first half to grow by 22.44% year-on-year, while Aojie Technology-U has turned profitable.
Currently, among the 50 constituent stocks in the index tracked by the Sci-Tech Chip ETF (589190), 13 have released their semi-annual performance forecasts for 2026. Of these, four companies anticipate a net profit increase of over 1000% year-on-year, with another five expecting growth exceeding 100%. The overall performance is notably strong.
Furthermore, on the industry front, ChangXin Memory Technology announced it will officially list on the STAR Market on Monday, July 27th. As a leading domestic IDM company with large-scale DRAM R&D and production capabilities, ChangXin's IPO proceeds are planned for capacity expansion and advanced process R&D. This will have a cascading effect throughout the industry chain, including equipment, materials, packaging & testing, and distribution.
First, semiconductor equipment is the most direct beneficiary of ChangXin's capacity expansion. Several leading domestic equipment manufacturers have already entered ChangXin's supply chain, with some product categories achieving large-scale shipments. Industry insiders point out that 2026-2027 represents a golden window for the adoption of domestic equipment.
Second, semiconductor materials are fundamental consumables for wafer manufacturing. With ChangXin's existing production lines running at high capacity and new capacity coming online, the materials sector is expected to see stable existing business and potential new demand awaiting release. Additionally, the introduction of packaging & testing and memory module products continues, which should also benefit.
Datong Securities notes that from a medium to long-term industrial perspective, the logic of AI-driven technological innovation and industrial upgrading has not been materially reversed by short-term market fluctuations. The current adjustment in the tech sector is more of an emotional sell-off on a trading level. The semiconductor cycle logic remains unchanged. Regarding the industry chain, attention should be focused on segments like semiconductor equipment, materials, and chips that have ample order books and strong semi-annual report performance certainty.*
2. Semiconductor Sector Shows Independent Strength Again. Billion-Yuan Packaging & Testing Leader Hits Daily Limit. Performance Pre-announcements, Buybacks, and Long-Term Capital Inflows Help Tech ETF Turn Positive Weekly.
Against the backdrop of a broad decline in the tech sector, the semiconductor industry chain strengthened against the market trend in the afternoon, becoming a highlight of the session. The first domestic tech leader-focused ETF, the Huabao Tech ETF (515000), briefly turned positive, rising over 1% intraday, before closing down 0.67%. Despite the daily decline, its weekly line turned positive after ending a three-week losing streak.
Performance among constituent stocks was mixed. The packaging & testing leader Tongfu Microelectronics hit its daily limit at one point before closing up 9.77%. Semiconductor equipment leader Piotech and edge AI chip leader Amlogic both rose over 6%. Storage chips and optical modules continued their adjustment, with Biwin Storage falling 5.6%, Tianfu Communication dropping over 4%, and Zhongji Innolight falling over 2%.
Currently, multiple positive factors are jointly building momentum for a tech sector recovery: a flurry of positive semi-annual performance pre-announcements from tech leaders, a rising willingness among listed companies to execute buybacks and shareholding increases, and the orderly entry of incremental capital. These factors are expected to gradually consolidate market confidence.
1. Earnings Boost: A wave of semi-annual report pre-announcements is being released, with leaders showing impressive results. Since July, over a hundred tech companies have issued performance pre-announcements. On the evening of July 24th, Amlogic disclosed its semi-annual report forecast, expecting a net profit of 608 million yuan for the first half, a 22.44% year-on-year increase. On the same day, Tongfu Microelectronics announced it expects a net profit of 1.6 to 1.8 billion yuan for the first half, a year-on-year increase of 288.26% to 336.80%, demonstrating significant earnings flexibility.
2. Buybacks and Shareholding Increases: Listed companies are actively taking action, demonstrating confidence. Recently, the trend of shareholding increases and buybacks in the tech sector has expanded. This week, several tech leaders, including Dongshan Precision, Montage Technology, Longsys, and Biwin Storage, have joined the ranks of companies announcing shareholding increases and buybacks. Wind data shows that 27 listed tech companies this week have proposed a total repurchase amount exceeding 4.5 billion yuan.
3. Capital Inflow Boost: Long-term capital is accelerating its entry, sending positive signals. China Chengtong and China Guoxin have started counter-cyclical market positioning, with an investment scale nearing 60 billion yuan, providing significant capital support. Several insurance companies have explicitly stated their intention to increase allocations to hard-tech tracks, making the signal of long-term capital entry increasingly clear. Public funds have also significantly increased their positions in the tech sector. Northbound capital achieved net inflows in the second quarter, with a notable increase in allocations to the information technology sector, indicating a rise in foreign capital appetite.
Looking ahead, foreign investors reaffirm their positive outlook on technology and AI-themed investment opportunities. UBS stated that the sharp sell-off in momentum stocks may be nearing its end, creating an opportunity for investors to rebuild positions in AI and semiconductor stocks. Following the recent drastic fluctuations in global capital markets and the release of some trading congestion in the tech sector, the technology and AI sectors are still expected to be the main market themes for the second half of the year.*
Note: Fund rates are detailed in the legal documents of each fund.
Source: Shanghai and Shenzhen stock exchanges, etc., as of July 24, 2026. Reminder: Market volatility may be significant in the near term, and short-term gains/losses do not predict future performance. Investors are advised to invest rationally based on their own capital situation and risk tolerance, paying close attention to position and risk management.
*Institutional views reference sources: Guosen Securities, July 19, 'The Bull Run is Not Over, New Scenery'; China Merchants Securities, July 24, 'Two Main Lines for Mid-Year Report Positioning: Performance Improvement + High-Prosperity Industry'; Datong Securities, July 22, 'Tech Stocks Accelerate Adjustment, Semiconductor Cycle Logic Unchanged'; UBS Securities, 'After Short-term Volatility, Continue to Favor Tech and AI as Main Themes for H2'.
Risk Warning: The Sci-Tech Chip ETF passively tracks the Shanghai Sci-Tech Innovation Board Chip Index, with a base date of 2019.12.31 and a release date of 2022.6.13. The Electronic ETF passively tracks the CSI Electronic 50 Index, with a base date of 2008.12.31 and a release date of 2009.7.22. The Tech ETF passively tracks the CSI Tech Leader Index, with a base date of 2012.6.29 and a release date of 2019.3.20. The HK Connect Information Technology ETF passively tracks the CSI HK Connect Information Technology Composite Index, with a base date of 2014.11.14 and a release date of 2017.6.23. The composition of index constituents is adjusted according to the index compilation rules. The back-tested historical performance does not guarantee future index performance. The stocks mentioned in the text are only objective displays of index constituents and are not stock recommendations. They do not represent the fund manager's or the fund's investment direction. Any information appearing in this article (including but not limited to individual stocks, comments, forecasts, charts, indicators, theories, and any form of expression) is for reference only. Investors must be responsible for their own investment decisions. Furthermore, any views, analysis, or predictions in this article do not constitute investment advice to readers. Huabao Fund is not liable for any direct or indirect losses arising from the use of the content. Investors should carefully read the fund contract, prospectus, fund product information summary, and other fund legal documents to understand the fund's risk-return characteristics and choose a product that matches their own risk tolerance. Past performance of a fund is not indicative of its future performance, and the performance of other funds managed by the fund manager does not constitute a guarantee of the fund's performance. According to the fund manager's assessment, the Tech ETF and Electronic ETF have a risk rating of R3-Medium Risk, suitable for balanced (C3) investors and above. The Sci-Tech Chip ETF and HK Connect Information Technology ETF have a risk rating of R4-Medium-High Risk, suitable for aggressive (C4) investors and above. For suitability matching opinions, please refer to the sales institution. Sales institutions (including the fund manager's direct sales and other sales institutions) will conduct risk assessments on the above funds according to relevant laws and regulations. Investors should promptly pay attention to the suitability opinions issued by the fund manager. The suitability opinions of various sales institutions may not be consistent, and the risk rating results issued by fund sales institutions may not be lower than those issued by the fund manager. The risk-return characteristics and risk ratings in the fund contract may differ due to different considerations. Investors should understand the fund's risk-return profile and carefully choose fund products based on their investment objectives, time horizon, investment experience, and risk tolerance, and bear the risks themselves. The registration of the above funds by the China Securities Regulatory Commission does not signify a substantive judgment or guarantee of the fund's investment value, market prospects, or returns. Fund investment requires caution.
Comments