Believe in the light! "Yi Zhongtian" hits a new high, the Hwabao WP SZSE ChiNext Artificial Intelligence ETF sees both volume and price soar! Hong Kong stocks in the chip sector are booming, 159131 hits a new record volume! Major players bet 23.2 billion on electronics

On May 28th, technology stocks suddenly surged in the afternoon, driving the major A-share indices to a strong rebound! The Shanghai Composite Index briefly fell nearly 1% during the session but ultimately closed up; the Shenzhen Component Index and the ChiNext Index both pulled up from deep water, closing up 0.8% and 1.96% respectively. The total market turnover was CNY 2.99 trillion, a slight decrease compared to the previous period. Optical module CPOs led the charge, with the three giants "Yi Zhongtian" (NewEase, Zhongji Xuchuang, Tianfu Communication) all reaching historical highs in stock prices. The optical module CPO content exceeds 50% and the "Yi Zhongtian" content is high in the Hwabao ChiNext Artificial Intelligence ETF (159363), which surged 3.16% to set a new closing high, with a total turnover of CNY 1.902 billion, a new high for the year, and "light chasers" violently subscribed for 922 million shares! Hard technology followed closely, covering 50 high-growth leaders in the ChiNext + STAR Market with the Hwabao Dual Innovation 50 ETF (588330) rising 2.89% to set a new historical closing high. The chip industry chain rebounded strongly, with the Hwabao STAR Chip ETF (589190), which is fully positioned in the chip industry, increasing 2.6% on high volume, having previously increased its holdings by over CNY 140 million during the last two days of decline. Amid the tech wave, the electronics industry received significant favor from main funds, with net inflows exceeding CNY 23.2 billion, ranking first among 31 Shenwan primary industries. Representative ETFs in the industry also attracted substantial capital, with the Hwabao Electronic ETF (515260), which gathers core leaders in the electronics sector, collecting CNY 225 million in the past five days! The Hong Kong stock market also saw some recovery in the afternoon, with the Hang Seng Index and the Hang Seng Technology Index both pulling up from below 2%, ultimately closing down 1.27% and 0.39%. The chip chain led the market against the trend, with HUA HONG SEMI soaring 11.55% to set a new historical high, while the largest and most liquid Hwabao HK Connect Information Technology ETF (159131) closed up 2.18%, with trading remaining hot at CNY 2.7 billion, marking the fifth consecutive day of historical high volume, having previously increased holdings by over CNY 426 million in the last two days! Where is the technology market, represented by AI computing power and the chip chain, currently heading? Huatai Securities' latest view indicates that the core main line of the market in the second half of the year may still be the AI revolution and the transformation of new and old driving forces in the Chinese economy. The long-term logic of the AI market remains unchanged, but short-term trading appears somewhat crowded, suggesting a balanced allocation. In terms of funds, the relocation of household deposits and the expansion of absolute return products constitute incremental main forces, while the listing of "Two Deposits" (Changxin Technology, Changcun Group) may only be a pulse disturbance, not altering the liquidity trend.* [ETF All You Need to Know Hot Review] Let's focus on the trading and fundamentals of several thematic sectors, including ChiNext Artificial Intelligence, Hong Kong Stock Connect Information Technology, and Electronics. 1. Optical Modules Soar! "Yi Zhongtian" Reaches New Heights! ChiNext Artificial Intelligence has skyrocketed 220% in the past year, with the largest scale in its category at 159363, both volume and price soaring! Optical Module CPOs are rising across the board, with Zhongji Xuchuang up 7.79%, Tianfu Communication up 4.42%, and Xinyi Sheng up 3.36%. "Yi Zhongtian" stocks have all hit historical highs! Additionally, Lian Te Technology hit the daily limit up of 20%, and Guangku Technology surged over 12%. In terms of popular ETFs, the ChiNext Artificial Intelligence ETF Hwabao (159363), which has over 50% exposure to Optical Module CPOs and a high concentration of "Yi Zhongtian," rose 3.16% in the market, reaching a new closing high, with daily trading exceeding 1.9 billion yuan, setting a new high for the year, and accelerated net inflow of funds at the end of the day, with a net subscription of 22 million shares throughout the day. On the news front, U.S. optical communication leader Mellanox Technologies has significantly raised its revenue expectations for optical interconnects! Mellanox expects its optical interconnect business to grow over 70% by the end of fiscal year 2027, a substantial increase from the previous expectation of 50%. Keen Insight Securities stated that the current optical interconnect sector is experiencing threefold benefits: on the computing infrastructure side, NVIDIA's performance expansion trend is clear, with capital expenditures reaching new highs; on the computing application side, Anthropic has achieved profitability for the first time, validating the economic profitability loop of large models; on the computing interconnect side, the application process of CPOs is accelerating, and high-barrier upstream segments are undergoing value reconstruction. Under the resonance of these threefold logic, the importance of optical interconnects has significantly increased, and it is recommended to pay close attention to leading optical module companies. Guosheng Securities indicated that as we enter June, the demand expectations for 2027 are gradually becoming clear, and the supply shortage of core upstream optical communication components is expected to gradually ease, with leading companies like Zhongji Xuchuang and Xinyi Sheng likely to accelerate performance release. It is recommended to return to the "Big Light" main line. Driven by the strong performance of overseas computing chains such as optical modules, ChiNext Artificial Intelligence continues to lead similar AI thematic indices! As of May 28, the high "light" ChiNext Artificial Intelligence ETF Hwabao (159363) has seen its underlying index accumulate nearly a 220% increase over the past year, significantly outperforming the overall market's similar AI thematic indices, continuing to show excess performance! Note: The Hwabao WP SZSE ChiNext Artificial Intelligence ETF passively tracks the ChiNext Artificial Intelligence Index, with a base date of December 28, 2018, and a release date of July 11, 2024. The annual returns of the ChiNext Artificial Intelligence Index from 2021 to 2025 are: 17.57%, -34.52%, 47.83%, 38.44%, and 106.35%. The composition of the index constituents is adjusted in a timely manner according to the index compilation rules, and its backtested historical performance does not predict future performance. One-click layout for optical module CPO leading opportunities, it is recommended to focus on the largest and most liquid Hwabao WP SZSE ChiNext Artificial Intelligence ETF (159363) and the off-market connections (Class A 023407, Class C 023408). The latest optical module content of the target index exceeds 50%, with a high "Yizhongtian" content, about 30% of the position is allocated to AI applications, which is not only the core of computing power but also a representative of AI applications. It is worth noting that as of May 27, 2026, the latest scale of Hwabao WP SZSE ChiNext Artificial Intelligence ETF (159363) has reached 7.435 billion yuan, ranking first in the entire market for the dual innovation AI track! The average daily trading volume in the last 6 months exceeded 800 million yuan, ranking first in the entire market for the AI track. II. Hong Kong stocks hard technology intraday "V-shaped" reversal! The largest Hong Kong Stock Connect Information Technology ETF Hwabao (159131) surged 2.18% with a transaction amount exceeding 2.7 billion yuan, setting a new historical high. The market trend is extremely polarized, with Hong Kong stocks hard technology experiencing an intraday "V-shaped reversal." Driven by the two major foundries "SMIC + HUA HONG," the Hong Kong Stock Connect Information C Index rose by 1.48%, strongly outperforming the Hang Seng Technology Index (which fell by 0.43%). The largest and most liquid \ Hong Kong Stock Connect Information Technology ETF Hwabao (159131) surged 2.18% with a single-day transaction amount exceeding 2.7 billion yuan, setting a new high since its listing!* It is noteworthy that during the recent two-day pullback, the Hong Kong Stock Connect Information Technology ETF Hwabao (159131) has continuously attracted explosive buying of over 430 million yuan, with another 5 million shares subscribed today. In terms of constituent stocks, HUA HONG SEMI surged over 11% to reach a historical high, while Hongteng Precision and Jiantao Group rose over 6%. SMIC, Lenovo Group, and Jiantao Laminates, among others, rose over 3% Great Wall Securities research report points out that the dual drivers of storage capacity expansion + domestic substitution have led to a high prosperity realization period for equipment and materials, the local capacity expansion of Changchun Changxin drives opportunities in the domestic supply chain. The shortage in the storage industry is expected to continue until 2027, and the upward trend in storage contract prices is also expected to persist, with industry chain companies likely to continue experiencing high growth. Dongxing Securities believes that the AI squeeze effect is reshaping the supply side, leading to a structural mismatch in storage supply and demand. The enormous demand for AI computing power has not only spurred an explosion in HBM demand but is also severely encroaching on the effective supply of traditional DRAM due to its extremely high consumption of wafers. At the same time, the original manufacturers on the NAND side shifting to high-level QLC production has also resulted in a structural tightening of overall capacity. Under the dual pressure of strong AI demand and controlled traditional capacity, the supply-demand tightness in the storage chip market may continue for several years. Since bottoming out and rebounding on March 31, the Hwabao Hong Kong Stock Connect Information Technology ETF (159131) has seen its benchmark index—the CSI Hong Kong Stock Connect Information Technology Composite Index—accumulate a rise of over 41%, while the gains for the Hang Seng Tech and Hong Kong Stock Connect Tech indices during the same period were 4.63% and 2.30%, respectively, showing significant lead in sharpness and elasticity. Statistical period: 2026.3.31-2026.5.27. The annual historical returns of the Hong Kong Stock Connect Information Technology Index from 2021 to 2025 are: -9.54%, -34.47%, -0.25%, 21.58%, 39.30%. Past performance of the index does not predict future results. Supports T+0 trading! Targeting the super cycle of Hong Kong stocks in chips—the first in the market, the largest in scale, and the most liquid Hong Kong Stock Connect Information Technology ETF Hwabao (159131), with the off-market connecting fund code026755**, the benchmark index is composed of “70% hardware + 30% software”, heavily investing in Hong Kong stocks in “semiconductors + electronics + computer software”, covering 52hard techcompanies in Hong Kong, among whichthe content of storage chips exceeds 26%, especiallythe combined weight of SMIC + HUA HONG SEMI exceeds 23%,making it the index with the highest weight of advanced wafer manufacturing in the entire market. The index constituents do not include large-cap internet companies like Alibaba, Tencent, and Meituan, making it sharper and easier to capture the Hong Kong stock AI hard tech market. (As of 2026.5.22) 3. Over 23 billion main funds surge! Triple good news resonance, Hwabao Fund Electronic ETF (515260) hits a new high and rises another 1.25%! In the past 5 days, it has attracted 225 million! The electronic sector saw a net inflow of over 23.2 billion from main funds throughout the day, ranking first among 31 Shenwan primary industries in terms of capital absorption. The electronic ETF Hwabao (515260) constituent stock Industrial Fulian received a net inflow of over 3.9 billion from main funds, dominating the A-share capital absorption list. In the semiconductor sector, leading integrated circuit manufacturer SMIC, Jinghe Integration, and China Resources Micro all hit historical highs; PCB leader Huadian Co. refreshed its listing high, and MLCC concept stock Sanhuan Group rose over 7%. In terms of popular ETFs, the Electronic ETF Hwabao (515260), which aggregates core leaders in the electronic sector, saw its on-market price rise another 1.25% today following yesterday's historical high, accompanied by a hot market, with funds actively entering! This ETF has continuously attracted capital over the past 5 trading days, totaling 225 million! In terms of news, focus on three major catalysts: 1. NVIDIA may ignite the PCB revolution The next-generation Rubin platform from NVIDIA is expected to increase the value of a single PCB by more than double. The upgrade in computing power is transitioning from "single chip" to "whole cabinet system hardware." PCB, HBM storage, MLCC, and high-speed switch chips are becoming the core incremental links in the AI infrastructure upgrade. 2. Huawei's "Tao (τ) Law" accelerates domestic substitution Huawei's "Tao (τ) Law" is referred to as the "DeepSeek Moment" that transcends Moore's Law. Companies in the tool layer that help implement Huawei's "Tao (τ) Law" are worth paying attention to, with EDA, semiconductor equipment, and advanced packaging being the three indispensable "shovel sellers" on the path of the Tao Law. The electronic ETF Hwabao (515260) includes EDA leader Huada Jiutian, semiconductor equipment leader Tuojing Technology, and packaging testing leaders Changdian Technology and Tongfu Microelectronics ** 3. TSMC Raises Prices for 3nm, Benefiting Domestic Foundries TSMC plans to raise the wafer foundry prices for its 3nm process again in the second half of 2026, with an increase of up to 15%, and may further increase by 5% to 10% in 2027. Industry insiders point out that this will benefit SMIC, JCET, Huazhu Microelectronics, and other domestic foundries with mature processes through a threefold mechanism of advanced process order spillover, elevated industry pricing expectations, and deepening domestic substitution from the perspectives of order acquisition and profit improvement. Looking ahead, CITIC Securities is optimistic that “price increases + AI + self-control” is expected to become a strong main line throughout the year for the electronics sector. The prosperity of the electronics industry is expected to continue, with AI remaining the biggest driving force. Firmly optimistic about the overall future market of the electronics sector. * 【Embrace Tech Giants, Seize Development Opportunities】 Electronic ETF Hwabao (515260) and its linked funds (Class A: 012550/Class C: 012551) passively track the Electronic 50 Index, heavily investing in the semiconductor and consumer electronics industries, focusing on popular sectors such as AI chips, automotive electronics, 5G, and printed circuit boards (PCB). Major stocks include Luxshare Precision, Cambricon, Foxconn Industrial Internet, and SMIC. Additionally, this ETF is a margin trading + stock connect target, serving as an efficient tool for one-click allocation of core assets in the electronics sector. Data Source: China Securities Index Company, Shanghai and Shenzhen Stock Exchanges, etc. Note: The “first in the entire market” refers to the Hwabao Hong Kong Stock Connect Information Technology ETF, which is the first ETF in the entire market to track the CSI Hong Kong Stock Connect Information Technology Composite Index. As of May 27, 2026, the latest on-market scale of the Hong Kong Stock Connect Information Technology ETF Hwabao is 1.321 billion yuan, making it the largest among the seven ETFs tracking the CSI Hong Kong Stock Connect Information Technology Composite Index; the average daily trading volume of the Hong Kong Stock Connect Information Technology ETF Hwabao this year has been 300 million yuan. \* Institutional viewpoints reference materials source: Huatai Securities Mid-term Investment Summit from May 27 to 28, 2026. 1: Open Source Securities “Silicon Photonics & CPO ‘Four Key Points and Four Small Dragons’ Welcome Good News Again”; Guosheng Securities “Return to Great Light”. 2: Great Wall Securities “AI-Driven Storage Price Increase Trend Continues, Longsun and Changxin Local Capacity Expansion Brings Opportunities for Domestic Chain”. Dongxing Securities “In-depth: AI Infrastructure Drives Storage Prosperity, Supply and Demand Resonance Highlights Profit Elasticity”. 3: CITIC Securities released on May 7 “Electronic Industry Q1 2026 Performance Summary—Industry Prosperity Continues to Rise, Firmly Optimistic About Four Major Directions” Note: ETF funds do not charge a sales service fee. When investors subscribe to or redeem fund shares, the brokerage firm acting as the subscription and redemption agent may charge a commission not exceeding 0.5%, which includes relevant fees charged by the stock exchange, registration agency, etc. For details on fund rates, please refer to the legal documents of each fund. Risk Warning: The individual stocks mentioned in this article are only an objective display of index constituent stocks and do not constitute any stock recommendations, nor do they represent the views of the fund manager or the investment direction of the fund. 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According to the fund manager's assessment, the risk levels of the Hwabao ChiNext Artificial Intelligence ETF, Hwabao SSE STAR Chip ETF, Hwabao Double Innovation 50 ETF, and Hong Kong Stock Connect ETFs are all rated R4 - medium to high risk, suitable for aggressive (C4) investors and above. The risk levels of the other funds mentioned in the article are rated R3 - medium risk, suitable for balanced (C3) investors and above. Suitability matching opinions should be based on the sales institution. Sales institutions (including direct sales institutions of the fund manager and other sales institutions) conduct risk assessments of the above funds according to relevant laws and regulations. Investors should pay attention to the suitability opinions issued by the fund manager in a timely manner. 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