Market Insight | HUA HONG SEMI Surges Over 8%, Leading Chip Stocks; Taiwan Semiconductor Responds to Rumors of Wafer Price Increase, HUA HONG SEMI May Raise Prices in the Second Half of the Year

Chip stocks surged in the morning session. As of the time of publication, Hua Hong Semiconductor rose by 7.83% to HKD 24.1; Shanghai Fudan rose by 3.93% to HKD 13.22; SMIC rose by 3.02% to HKD 18.4; SOLOMON SYSTECH rose by 2.86% to HKD 0.36. On the news front, recently, Taiwan Semiconductor's stock price has been continuously rising. There are rumors in the market that Taiwan Semiconductor may intend to raise wafer prices. In response to the price hike rumors, Taiwan Semiconductor stated that the company's pricing strategy has always been strategy-oriented rather than opportunistic, and the company will continue to work closely with customers to provide value. In addition, Morgan Stanley stated that Hua Hong Semiconductor's wafer fab utilization rate has exceeded 100%, so it may raise wafer prices by 10% in the second half of the year. Furthermore, CITIC Securities released a research report stating that the establishment of the National Integrated Circuit Industry Investment Fund Phase III will promote the localization substitution process of core technologies such as materials, equipment, and chips. Guotai Junan Securities stated that in the semiconductor chip industry, the industry as a whole has passed the "active destocking" phase and entered the "passive destocking" phase. However, with the recovery of demand, the industry as a whole is expected to start actively stocking up, entering an upward cycle