A-shares continued to fluctuate downward today, but the semiconductor sector opened higher. Aixuan shares, Fine Made Micro, Tech Semiconductors, Montage Technology and others rose one after another. At noon, Tech Semiconductors, Shanghai Fullhan Microelectronics, and Aixun Electronics rose by 12%, 8.49%, and 7.23%, respectively.

On the ETF side, the Tibet Dongcai Fund Chip ETF, Tianhong Fund Chip Industry ETF, Huitianfu Fund Chip 50 ETF, and Invesco Fund Chip 50 ETF all rose by 1.01%, 1.01%, 1%, and 0.99%, respectively.

According to the latest report released by Macquarie Securities, based on a supply chain survey, most of TSMC's customers have agreed to increase contract prices in exchange for reliable supply. It is estimated that TSMC's gross margin will climb to 55.1% by 2025.

News of price increases in the semiconductor industry chain are becoming more and more frequent, including companies such as Qualcomm, TSMC, SMIC, etc., covering IC design, chip manufacturing and other links.

According to the statistics of the Semiconductor Industry Association (SIA) of the United States, the global semiconductor industry sales reached 49.1 billion US dollars in May, up 4.1% month-on-month and 19.3% year-on-year, which is the largest increase since April 2022.

In addition, many semiconductor companies have recently released positive news. On the evening of July 5th, Weir Semiconductor expects to achieve a revenue of 11.904-12.184 billion yuan in the first half of 2024, a year-on-year increase of 34.38%-37.54%; and a net profit attributable to shareholders of 1.308-1.408 billion yuan, a year-on-year increase of 754.11%-819.42%.

Montage Technology expects to achieve revenue of 1.665 billion yuan in the first half of 2024, a year-on-year increase of 79.49%; and a net profit attributable to shareholders of 0.583-0.623 billion yuan, a year-on-year increase of 612.73%-661.59%.

Currently, there are multiple A-share ETF products related to the semiconductor theme, with index names including Semiconductor Materials and Equipment, Sci-Tech Innovation Chip, CSI All Share Semiconductors, Sci-Tech Innovation Chips, China-Korea Semiconductors, China National Integrated Circuit Corp. (CNI), and Chip Industry.

Looking at the changes in fund flows of semiconductor-related ETF products last week, funds are actively buying related ETF products. Among them, China United Fund Semiconductor ETF, Jiashi Fund Sci-Tech Chip ETF, Huatai Bairui Fund China-Korea Semiconductor ETF and Huaxia Fund Chip ETF had a net inflow of 554 million yuan, 208 million yuan, 201 million yuan and 102 million yuan respectively last week.

In terms of the latest scale, the semiconductor-related ETF products with the largest scale in A-shares are Huaxia Fund Chip ETF, China United Fund Semiconductor ETF and Guotai Fund Chip ETF, tracking the index names of China Chip, CSI All Share Semiconductors and China Semiconductor Chips, respectively.

The top ten weighted stocks of the CSI Semiconductor Index are Naura Technology Group, Semiconductor Manufacturing International Corporation, Weir Semiconductor, Hangzhou Silan Microelectronics, Gigadevice Semiconductor, Advanced Micro-Fabrication Equipment Inc. China, Montage Technology, JCET Group Co. Ltd., Horizon Robotics and Tsinghua Unigroup, with a total weight of 44.57%.

Looking at the top ten weighted stocks of the China Chip Index, in fact, the top nine names are the same, only the weights of individual stocks are different. The tenth weighted stock is Sanan Optoelectronics, while the tenth weighted stock of the CSI Semiconductor Index is Tsinghua Unigroup.

The biggest difference between the China Chip Index and the CSI Semiconductor Index is the uneven distribution of the top ten weighted stocks, with the concentration of China Chip being 63.5% and CSI Semiconductor Index being 44.57%.

Ping An Securities stated that according to statistics from the Semiconductor Industry Association (SIA) in the USA, the global semiconductor industry sales in May 2024 reached $49.1 billion, an increase of 19.3% compared to the same period in 2023, and a 4.1% increase compared to April 2024. Currently, there are signs of improvement in semiconductor manufacturing, and local production substitutes are thriving. Semiconductor equipment companies have ample orders, and the industry's prosperity is maintained. In addition, major manufacturers continue to invest in AI terminal products, and chips with AI capabilities are constantly emerging. It is expected to drive a new round of demand for upgrades, and it is suggested to pay attention to this industry.