ST is in fine form, with excitement building ahead of Unitree Robotics’ listing

(Il Sole 24 Ore Radiocor) - Tech shares are still performing strongly in Europe, following on from developments in Asia and ahead of the IPO of Unitree Robotics , the Chinese humanoid robotics group that could make its debut on the Shanghai Stock Exchange this week. In Milan, Stmicroelectronics has shot to the top of the index, closely followed by Prysmian. Outside the main index, Technoprobe is rising; the share is also benefiting from the fact that on Friday the company announced formal progress in its partnership in China: according to analysts at Banca Akros, the progress regarding the Chinese joint venture is ‘positive, but expected’; in any case, ‘strengthening its presence in the Chinese market in the medium term could represent an opportunity’ for the group. Turning back to European shares, Infineon Technologies in Frankfurt, whilst in Amsterdam ASML Holding, BE Semiconductor and ASM International are leading the way. 

To begin with, this morning technology shares drove the Nikkei in Tokyo higher (+0.74 per cent), thanks to strong demand linked to artificial intelligence, which continued to underpin the prospects of companies integrated into the global semiconductor supply chain. This momentum spread to China, with the Shanghai market closing 1.4 per cent higher, where chip stocks outperformed. Cambricon Technologies jumped 5.7 per cent, SMIC gained 2.9 per cent and Foxconn Industrial Internet rose 3.1 per cent. Alibaba rose by 1.3%, remaining in the spotlight following reports that it is seeking to sell its gaming division, Lingxi Games, in a deal that could value the studio at more than $1.5 billion. CXMT posted a brilliant performance: the memory chip manufacturer’s shares closed the session up 11.7 per cent, with the weighting of the Chinese hardware sector — which includes CXMT — having temporarily overtaken both the retail and software sectors this year in the MSCI China All Shares Net Total Return Index, according to data compiled by Bloomberg.

All this whilst we await the IPO of Unitree Robotics, the Chinese group that had attracted frenetic demand from retail investors, with the tranche reserved for small investors oversubscribed by more than 5,500 times. Both the humanoid robot company and Cxmt are closely linked to Beijing’s efforts to catch up with and overtake the United States in a technology with the potential to transform economies. Unitree is expected to begin trading in Shanghai as early as this week, putting investors’ appetite for AI-related hardware to the test. Cxmt, now in its third week of trading, has risen by over 500 per cent since its debut. Confidence in China’s prospects in the AI race is growing; however, most bets on this growth are focused on hardware suppliers, which offer more immediate visibility on revenue and profits.

It must be said that technology shares have proved volatile in the age of artificial intelligence, and market sentiment can shift dramatically. At present, however, the market seems to have regained confidence – a confidence that has spread from Asia to Europe – whilst we wait to see whether it will also take hold in the United States.