The semiconductor and chip sector staged a powerful recovery today. Huabao SSE STAR Market Chip ETF (589190), which offers a comprehensive portfolio of the chip industry with a focus on core constituents, opened higher and continued to climb, experiencing a second surge in the afternoon session. Its on-market price soared 5.25%, swiftly recouping losses from the previous trading day.
In terms of market performance, the semiconductor materials segment led the gains, with silicon wafer concept stocks skyrocketing. National Silicon Industry Group and Fortune Precision surged by the 20% daily limit, while GRINM Semiconductor Materials rose over 17% intraday to hit a record high, and Shanghai Sinyang Semiconductor Materials advanced more than 12%. The semiconductor silicon wafer market is reportedly preparing for a new round of price hikes, with analysis suggesting the price transmission is now formally extending from wafer fabs downstream to material suppliers. Analog chips also moved higher, with Joulwatt Technology hitting the 20% limit and Southchip Semiconductor Technology gaining over 11%. Among major weighted leaders, Semiconductor Manufacturing International Corporation rose more than 4%, Hygon Information Technology increased over 3%, and Cambricon Technologies advanced more than 1%.
Key Drivers for the Sector's Rebound
The chip industry's return to an upward trajectory is driven by several short-term factors. Firstly, there is a strong positive signal from overseas markets. Overnight, the Philadelphia Semiconductor Index surged 5.61%. Today, memory chip stocks led a major rebound in the South Korean market, with Samsung Electronics rising as much as 9% intraday and SK Hynix soaring over 15% at one point.
Secondly, industry titans have voiced support, bolstering market confidence. Both Jensen Huang and Elon Musk have made bullish statements regarding chip demand. Huang stated that SK Hynix's plan to double wafer capacity by 2030 is insufficient. Just a day earlier, NVIDIA and SK Hynix announced a multi-year technical cooperation agreement to jointly develop memory for NVIDIA's Vera Rubin AI supercomputer and Vera CPU, and to apply AI technology to semiconductor chip design and manufacturing. Elon Musk commented that the real bottleneck lies in chip manufacturing capacity, noting that Micron Technology's current production still falls far short of actual demand.
Long-Term Industry Outlook
From a medium to long-term perspective, the supply-demand imbalance in the chip market driven by AI is becoming increasingly pronounced, sustaining high industry prosperity. The World Semiconductor Trade Statistics organization forecasts global semiconductor growth of 90% by 2026, reaching $1.5 trillion. This is expected to be primarily driven by memory chips, with a projected 250% year-on-year increase, while logic circuits are anticipated to grow 37% by 2026.
Huayuan Securities noted that the global semiconductor supply chain has entered an expansion cycle. Domestic wafer fabs are accelerating capacity expansion and supporting the local supply chain due to security considerations. Significant breakthroughs in localization have been achieved in areas like etching, thin-film deposition, and CMP, with progress also expected in segments like coating/development and metrology/inspection. The domestic self-reliance sector has shown growth momentum following related companies' earnings reports. As advanced memory and process wafer fabs advance their expansion plans, this sector is poised for a new upward cycle.
Gaining Exposure to the Chip Super Cycle
For investors seeking exposure to the chip industry's "super cycle," high-beta instruments like the 20%-limit stocks are an option. Public information shows that Huabao SSE STAR Market Chip ETF (589190) and its feeder funds track the SSE STAR Market Chip Index. While providing a balanced, full-chain exposure to the chip industry, it allocates over 90% of its weight to core areas like integrated circuits and semiconductor equipment, reflecting its high concentration in hard technology and strong offensive characteristics.
Public data indicates that Huabao SSE STAR Market Chip ETF (589190) charges a management fee of 0.3% and a custody fee of 0.08%, resulting in a total expense ratio of 0.38%, which is relatively low among ETFs tracking the same underlying index.
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