Chinese Tech Stocks Surge on Huawei’s New Smartphone
Surprising Announcement
Chinese tech stocks surged on Wednesday after Huawei Technologies surprised investors with a 6,999 yuan ($960) smartphone, raising hopes for progress in domestic chips and mobile technology despite US sanctions.
The Mate 60 Pro, which went on sale online this week unannounced, caused a sensation among Chinese users who saw the gadget as Huawei’s return to the high-end market. Many users posted posts describing its high wireless performance, which gave rise to rumors that Huawei was able to realize the capabilities of 5G technology despite the ban on chip production and advanced technologies.
Shares of Chinese chip makers and Huawei suppliers, including Lontium Semiconductor, Cambricon Technologies and Anker Innovations, rose 8-11%. Biwin Storage Technology and Guangdong Leadyo IC Testing Co. increased daily limits by 20%.
Tensions and Sanctions
Huawei is one of many Chinese companies at the center of tensions between Washington and Beijing and is the target of sanctions for selling American software and electronic circuits over allegations of aiding the Chinese military.
A leading consortium of global chipmakers warned this year that Huawei is building a semiconductor manufacturing cluster across China, a shady manufacturing network that will allow the blacklisted company to avoid US sanctions and boost the country’s technology ambitions.
The online screenshots purportedly show the Mate 60 Pro running at 5G-enabled speeds, putting the device at the top of popular topics on China’s Weibo platform, similar to “X”. A Huawei spokesperson declined to comment on the device’s components, but called it “the most powerful Mate ever.”
The launch of the Mate 60 will catalyze the growth of domestic and high-end smartphones and will drive demand in the supply chain, especially amid a downturn in the semiconductor sector, analysts at Huajin Securities wrote.
