China’s stock markets surged today, delivering the strongest gains in over two months as regulatory pledges to stabilise markets reignited investor confidence. Local chip companies also soared, spurred by intensified US export curbs that spotlighted the strategic importance of China’s semiconductor industry.
The Shanghai Composite index rose 2.5% to 3,240.94, while the blue-chip CSI300 index climbed 2.6%, marking their best single-day performances since early November. Hong Kong’s Hang Seng Index rebounded 1.8% from a four-month low, with the tech sector jumping over 3%, reflecting renewed optimism across the board.
Investor sentiment gained momentum as Beijing announced plans to counteract a sluggish start to the year, which had seen the market languish amid geopolitical uncertainties and policy apprehensions. Pledging robust support, the China Securities Regulatory Commission (CSRC) committed to prioritising stock market stability in 2025, aiming to foster sustained upward momentum. The People’s Bank of China (PBOC) echoed this sentiment, outlining enhancements to relending and funding mechanisms introduced last year, while reaffirming its commitment to stabilising the RMB exchange rate.
According to analysts at CITIC Securities, the market’s subdued performance at the beginning of 2025, combined with rising external pressures, has created conditions ripe for additional policy interventions, potentially driving a sustained recovery.
China’s semiconductor sector emerged as a clear winner amid the rally, with the CSI Semiconductor Industry Index advancing 4.1%. Leading players, including Semiconductor Manufacturing International Corp and Hua Hong Semiconductor, posted notable gains of 4% and 3.7%, respectively. Domestic investors have increasingly backed local chipmakers as the US announced further restrictions on AI chip and technology exports, reinforcing the strategic importance of China’s homegrown tech industry.
China’s proactive measures to stabilise its capital markets and the strategic focus on its semiconductor sector underline the country’s commitment to sustaining economic resilience and technological self-reliance.
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