HK Stock Market Move | Semiconductor Manufacturing International Corporation (00981) fell by more than 4% again, as JP Morgan pointed out that increased demand for AI is driving up prices, with expectations that consumer electronics demand will weaken in the second half of the year.

Semiconductor Manufacturing International Corporation (00981) fell by more than 4%, dropping by 4.71% to 67.8 Hong Kong dollars with a trading volume of 7.202 billion Hong Kong dollars as of the time of this publication. On the news front, Semiconductor Manufacturing International Corporation's first-quarter revenue reached 2.55 billion US dollars, an increase of 11.5% year-on-year, while net profit attributable to shareholders was 503 million US dollars, a decrease of 0.4% year-on-year. JP Morgan pointed out that although AI-related demand and localization trends have driven some product price increases, which have been reflected in the first quarter, it will be further reflected in the second quarter. However, it is expected that consumer electronics demand may weaken in the second half of the year due to advance supply in the first half and terminal product price increases. The bank stated that although there are risks to consumer demand in the second half of the year, given the wider-than-expected range of price increases, JP Morgan has upgraded its investment rating on SMIC from "underweight" to "neutral" with a target price raised from 57 Hong Kong dollars to 67 Hong Kong dollars. The bank believes that a clearer path to profit margin recovery is needed to further re-evaluate the stock price, while downside risks come from weaker-than-expected consumer demand suppressing pricing.