On the morning of September 8, the A-share AI hardware sector encountered a “black half an hour”, with five leading companies including Zhijiu Xuchuang experiencing a combined market value evaporation of about 190 billion yuan within a short 30-minute period. By the end of the trading day, the AI sector as a whole showed a widespread trend of decline. Analysts revealed the “hidden hand” behind the collective plunge of Chinese AI chip stocks.
During the first 30 minutes of trading on September 8, the AI hardware sector saw a sharp decline. Zhijiu Xuchuang, Xinyisheng, Tianfutongxin, Seng Hong Technology, and Industrial Fulian, the five leading companies, all experienced stock price declines of over 10%, resulting in a total market value loss of approximately 190 billion yuan. Among them, the market value evaporation of the optical module leader Zhijiu Xuchuang alone exceeded 60 billion yuan, accounting for one-third of the total loss.
By the close of trading, segments of the AI industry chain involving optical modules, GPUs, and PCBs all saw a sharp decline, with few individual stocks in the sector escaping. Concept stocks such as Xinyisheng in CPO (co-packaged optics) fell by over 10%, Liantek Technology, Guangkoo Technology, and Zhijiu Xuchuang dropped by over 9%, while Tianfutongxin fell by more than 7%. In the server and GPU fields, Industrial Fulian fell by over 7%, and Cambrian Technology dropped by nearly 5%. In the PCB (printed circuit board) field, Seng Hong Technology fell by nearly 10%, and Shanghai Electric Corp fell by nearly 6%.
The sharp decline in AI stock prices occurred against the backdrop of several months of strong gains in the AI sector. Data shows that Zhijiu Xuchuang had a maximum increase of over 400% within the year, while Xinyisheng saw a surge of over 600% during the same period.
Analysts believe that on that particular day, funds clearly flowed out of overvalued AI sectors and shifted to sectors like healthcare, agriculture, and aerospace with relatively reasonable valuations and stronger policy expectations. This reflects market concerns about the overvaluation of the AI sector and a “fear of heights” mentality among investors.
Citing market analysis, “First Financial” pointed out that leveraged funds typically exhibit characteristics of both boosting and pulling down stock prices.
Since August, leverage clients have massively increased their positions in the technology industry, with the financing balances of companies like Zhijiu Xuchuang, Xinyisheng, and Seng Hong Technology all doubling in the past month to over 7 billion yuan each; Industrial Fulian’s financing balance also increased by 3.538 billion yuan, representing a 119% increase.
Analysts believe that during the upward trend, leveraged positions push up stock prices, creating a feedback loop. However, once the market shifts, leveraged positions may hit liquidation lines, forcing further sell-offs and exacerbating the decline, forming a negative feedback loop.
Meanwhile, the A-share market has recently experienced a thrilling rollercoaster ride. On the afternoon of August 27, the Shanghai Composite Index surged to 3,887.20 points intraday, only to rapidly decline, ultimately dropping 1.76% and barely holding above the psychological barrier of 3,800 points. The Shenzhen Component Index and the ChiNext Index also swiftly turned around after hitting their peak levels, falling by 1.43% and 0.69% respectively.
The trigger for the market turmoil was attributed to the AI chip leader, Cambrian Technology. On August 28, Cambrian Technology’s stock price once again soared, surpassing Guizhou Maotai to become the king of A-shares. Fueled by frenzied market enthusiasm, Cambrian Technology’s price-to-earnings ratio has reached an astonishing 595 times. However, on September 4, Cambrian Technology’s stock price dropped by 14.45%, resulting in a market value loss of over 160 billion yuan in the six trading days following the peak on August 28.