Since China launched its policy combination punch on September 24th, Hong Kong stocks have seen significant gains, with multiple indicators indicating that investor sentiment in Hong Kong stocks is very hot. Semiconductor stocks have also experienced a major explosion.

On October 8th, the semiconductor ETF closed up 9.95% with a turnover of 861 million yuan. The constituent stocks collectively rose, with SMIC, Haiguang Information, Zhongwei Company, Lanqi Technology, and Cambrian all hitting the daily limit up by 20%; Northern Huachuang, Weier Shares, Zhaoyi Innovation, and Ziguang Guowei all hit the daily limit up by 10%, while Changdian Technology rose by 9.99%.

On the news front, the semiconductor sector of Hong Kong stocks has continued to soar since October, with SMIC rising nearly 60% this month, Shanghai Fudan rising 73% this month, and Huahong Semiconductor rising 55% this month. 

This increase not only demonstrates the market's optimism towards the semiconductor industry, but also indicates that the industry may have greater development space in the future. At the same time, other semiconductor stocks also performed well, injecting strong momentum into the Hong Kong stock market.

On the news front, CMB International recently pointed out in its research report that with the government's introduction of new stimulus policies, the Chinese stock market (including A-shares and H-shares) has seen significant gains, especially in the semiconductor and communication industries. The institution predicts that the semiconductor industry may face an opportunity for a reassessment, and this market trend may continue in the short term, especially for semiconductor stocks listed in Hong Kong.

In the report, CMB International is particularly optimistic about semiconductor stocks in Hong Kong, believing that with the improvement of market sentiment and the inflow of funds, these stocks may have further upward potential. They particularly recommended SMIC, Huahong Semiconductor, and ZTE because these companies have a large market value and good liquidity, which may attract more fund investments.

In addition, the strong recovery of fundamentals is also the main reason for the influx of funds into the semiconductor sector. At present, the recovery momentum of the semiconductor industry chain continues to exceed market expectations. The latest data released by the Semiconductor Industry Association (SIA) in the United States shows that in August 2024, global semiconductor sales reached $53.1 billion, a year-on-year increase of 20.6%.

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