Chip stocks continue to decline recently. As of the time of publication, Hua Hong Semiconductor (01347) fell by 4.69%, at HKD 20.3; Semiconductor Manufacturing International Corporation (00981) fell by 2.45%, at HKD 16.72; Shanghai Fudan (01385) fell by 1.52%, at HKD 11.64.
According to the IntelliNews app, chip stocks continue to decline recently. As of the time of publication, Hua Hong Semiconductor (01347) fell by 4.69%, at HKD 20.3; Semiconductor Manufacturing International Corporation (00981) fell by 2.45%, at HKD 16.72; Shanghai Fudan (01385) fell by 1.52%, at HKD 11.64.
On the news front, overseas chip stocks have seen increased volatility due to news that the US government is considering strengthening chip trade controls, as well as recent comments from US presidential candidate Trump. BOCOM International pointed out that potential negative effects on semiconductor manufacturers may be concentrated in Taiwan, China, rather than on domestic semiconductor manufacturing companies in the US and China, which may even benefit from the situation. In the short term, the impact of recent overseas policies on market sentiment may be greater than the actual impact. In the long term, trade controls may accelerate the development of domestically produced alternatives to China's semiconductor design.
Morgan Stanley previously pointed out that investors have a high expectation of rising prices for power, analog, and NOR Flash products. However, these products are mostly used in terminal areas with limited demand recovery. As suppliers adopt a price-for-volume strategy, it is estimated that price increases will ultimately lead to the loss of unaffordable market share for these products. In addition, Chinese wafer foundries and IDM companies will launch new backward process production capacity by 2025. Therefore, we believe that the exacerbation of oversupply does not support a significant price increase in the second half of 2024.