Trump's AI chip ban has fueled a blistering rally in China's chip and tech stocks — and sparked overheating concerns

Group 1 - The US ban on advanced AI chip exports has significantly boosted China's chip stocks, leading to increased investment in domestic companies [1][6] - The Hang Seng Tech Index has surged 67% in 2025, reversing previous weaknesses, despite ongoing challenges such as a property crisis and trade tensions with the US [2] - Chinese firms are reportedly accessing high-end chips through unconventional means, while also developing their own chips to reduce reliance on US technology [3][4] Group 2 - Cambricon, a key player in China's AI chip market, reported a remarkable revenue increase of 4,300% to 2.88 billion Chinese yuan (approximately $403.3 million) in the first half of 2025, with its stock nearly doubling this year [7] - Major companies like Alibaba and Tencent are also contributing to the tech sector's resurgence, highlighting a competitive landscape among local chipmakers [6][5] - China's localization strategy in AI hardware manufacturing positions it as a strong competitor globally, ranking second only to the US in the AI sector [5]