China Stocks Edge Higher as Chipmaker Rally Ends Losing Streak
Chinese stocks rose slightly on Friday, snapping a three-day losing streak, as renewed optimism over domestic semiconductor firms lifted sentiment. However, major indexes remained on course for a modest weekly loss amid subdued investor confidence and a lack of fresh catalysts ahead of a key policy meeting.
By the midday break, the Shanghai Composite Index had inched up 0.1% to 3,878.98 after spending most of the morning under pressure. The blue-chip CSI 300 Index also gained 0.1%, extending its weekly rise to 0.6%. Despite Friday’s mild rebound, the benchmark Shanghai index was still down 0.3% for the week.
Moore Threads Sparks Tech Optimism
Investor attention focused on Moore Threads Technology Co, often dubbed “China’s Nvidia.” The company’s shares surged nearly fivefold in their trading debut, underscoring strong market confidence in China’s semiconductor sector. The enthusiasm reflected expectations that U.S. sanctions could ultimately benefit domestic chipmakers as Beijing accelerates efforts to boost technological self-sufficiency.
The debut came shortly after a bipartisan group of U.S. senators proposed legislation to prevent the Trump administration from easing restrictions on China’s access to advanced AI chips produced by Nvidia and AMD for at least two and a half years. The development reinforced the geopolitical backdrop driving national investment in China’s chip industry.
Patrick Pan, China equity strategist at Daiwa Capital Markets in Hong Kong, said the country’s technological progress and rising “national pride” were likely to underpin the market’s slow bull phase over the next six to twelve months. “From a longer-term perspective, the recent pullback in China equities should have freed up more upside for the coming year,” he added.
Property Sector Drags Amid Weak Outlook
While technology stocks gained ground, the property sector continued to struggle. The CSI 300 Real Estate Index dropped more than 2%, extending losses as concerns persisted about China’s prolonged housing downturn.
According to a recent Reuters survey, home prices are projected to fall 3.7% this year and could continue declining through 2026 before stabilising in 2027. The weak real estate outlook remains a major headwind for broader market recovery.
Hong Kong Markets Mixed
In Hong Kong, the benchmark Hang Seng Index slipped 0.2% by midday but remained on track to post a weekly gain. The Hang Seng Tech Index also fell 0.2%, mirroring the cautious sentiment in mainland markets.
Despite short-term volatility, analysts said optimism surrounding domestic innovation and policy support could sustain selective gains in Chinese equities heading into 2026.
with inputs from Reuters
