HK Stock Market Move | Chip stocks continue to slump, the United States plans to restrict the export of key software, institutions are optimistic about the acceleration of domestic independent and controllable process.

Chip stocks continued to decline. As of the time of writing, HUA HONG SEMI (01347) fell by 7.5% to 70.25 Hong Kong dollars; SHANGHAI FUDAN (01385) fell by 6.43% to 39 Hong Kong dollars; SOLOMON SYSTECH (02878) fell by 1.96% to 0.5 Hong Kong dollars; Semiconductor Manufacturing International Corporation (00981) fell by 1.87% to 73.45 Hong Kong dollars. On the news front, according to media reports on Wednesday citing a U.S. official and three people briefed on the U.S. government's briefings, the White House is considering restrictions on products produced using U.S. software and exported to China. This news caused further declines in U.S. stocks, with EDA software stocks plummeting. Sources said that the plan is not the only consideration and may not be implemented. It is worth noting that NVIDIA has confirmed its complete withdrawal from the Chinese AI chip market, and Micron plans to suspend the supply of server chips to China. First Securities issued a research report stating that the comprehensive export controls between China and the U.S. in semiconductors and rare earths mark a shift in trade frictions towards confrontation over upstream core technologies and raw materials. The implementation of semiconductor export controls by the U.S. will accelerate the domestic industry chain's autonomous controllability and achieve domestic substitution. CMSC believes that under the continuous strengthening of export controls by the U.S., the domestic autonomous controllable process will accelerate, and the expected expansion of semi-advanced domestic production lines by 2026 is expected to speed up, which will also drive positive expectations in the domestic equipment/component sector and the domestic substitution process.