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Chinese A-shares closed higher on Friday, with the benchmark Shanghai Composite Index up more than 1.2% to close at 3,227, the Shenzhen Component Index up 1.7% to 12,269 and the tech-heavy Chinext Price Index up 1.6% to 2,683.
The tech-focused Star50 Index surged by more than 4%, the biggest one-day gain in nearly two months.
Semiconductor companies staged a strong rally, with an index tracking the sector compiled by Wind Information surging 4.4%, making it the best-performing sector in the A-share market and several companies in the sector hit limit-up.
Computer companies, telecommunication companies, software developers, precious metal companies, securities brokerages and steel makers also outperformed. Only a few sectors closed lower, including coal miners, automakers, catering and tourism companies and oil companies.
The rally in the semiconductor companies was driven by expectations of increasing domestic supply to replace imported chips, according to a note from Shanxi Securities, but it noted that “the key bottlenecks for the domestic semiconductor sector’s development remains, which are impossible to be eradicated in the short term.”