HK Stock Market Move | Multiple bearish factors hammer optical communication concept stocks; YOFC (06869) drops over 17%, Zhongji Innolight (03308) falls nearly 12%.

Optical communication concept stocks plunged across the board. As of press time, YOFC (06869) fell 17.00% to HK$154.8; TRIGIANT (01300) dropped 14.20% to HK$2.96; Zhongji Innolight (03308) declined 11.70% to HK$1,034.0; Cig Shanghai (06166) fell 11.32% to HK$102.6. On the news front, the optical communication industry has encountered multiple major bearish factors. U.S. bipartisan lawmakers proposed a bill to ban Chinese optical modules from federal sensitive systems and listed Zhongji Innolight and Eoptolink Technology Inc. as restricted suppliers; Hengtong Optic-Electric plans to issue shares to raise no more than 6.636 billion yuan, intended for nine projects including optical communications; recently, Oracle issued a force majeure notice to data center developers, and the project may not be able to commence operations on schedule in 2028, shaking market expectations for the pace of subsequent optical module procurement. Citi believes that both Zhongji Innolight and Eoptolink Technology Inc. have insignificant business exposure in the U.S. government defense or intelligence supply chain. The five-year transition period and exemption clauses stipulated in the bill further buffer potential near-term disruptions, but political risks need to be monitored. Jefferies stated that the possibility of the U.S. banning Chinese optical modules from private data centers is very low, and the bill is currently more of a policy noise.