Cambricon Shares Drop 12% After August Rally Triggers Profit-Taking
Shares of Chinese AI chipmaker Cambricon Technologies fell sharply on Thursday, as investors took profits following the company’s dramatic rise in August. The stock dropped around 12% during morning trade, marking its steepest intraday decline since January 2025.
Cambricon, often seen as China’s equivalent to US-based Nvidia, had more than doubled in value last month. This surge raised its weighting in the tech-heavy STAR50 Index to 15%, exceeding the 10% cap for a single stock. The breach has led to concerns about forced rebalancing when the index resets on 12 September.
Sector-wide losses weigh on markets
The sell-off in Cambricon triggered broader losses in China’s semiconductor sector. The onshore semiconductor index fell nearly 6%, while the STAR50 Index lost more than 5% in the same session.
The recent gains in Cambricon shares prompted the company to issue a cautionary statement last week. In a filing to the stock exchange, the Beijing-based firm warned investors about the risks tied to the rapid rise in its stock price, in an effort to discourage speculative trading.
AI and tech stocks lead gains — and volatility
Technology and artificial intelligence stocks have been the major drivers of China’s stock market rally in 2025. The STAR50 Index has gained 26% year-to-date, while a key AI stock index has risen 47% over the same period.
However, risk sentiment has started to cool. A recent media report suggested that Chinese regulators are considering steps to slow down the market rally, which has gained momentum since early August. The CSI300 Index, a key benchmark, climbed 10% in the past month.
