TiandF Communications plunges over 10%, an unexpected heavy hit to the computing power sector! Huabao Fund's GEM Artificial Intelligence ETF drops 4%, sparking a rush of fund accumulation! Is the market overreacting?

Why did Nvidia’s breakthrough at GTC cause a pullback in the computing power sector?

On Tuesday (March 17), the computing power sector unexpectedly plummeted, with optical module CPO experiencing a sudden correction. Leading stocks like Guangku Technology, Changxin Bochuang, and Tianfu Communications fell over 10%, while many others such as Taichen Optoelectronics, Zhishang Technology, Ruijie Networks, Liantech, and Yixinsheng declined more than 5%.

Regarding popular ETFs, the AI-focused Growth Enterprise Market (GEM) Artificial Intelligence ETF (159363), which heavily invests in optical modules, weakened sharply in the afternoon, with intraday prices dropping 4.34%, marking the largest single-day decline in nearly four months. It broke below the 60-day moving average, with a daily trading volume of 574 million yuan, and saw funds pouring in at lows, totaling 50 million shares.

At the GTC conference, Nvidia announced multiple technological breakthroughs. However, the A-share computing power and optical module sectors surprisingly declined, attracting market attention. Analysts pointed out that Nvidia’s new rack design, possibly combining “optical and copper” solutions, led to a systemic revision of market expectations for AI interconnection routes. Nvidia’s new generation chips are expected to be launched around 2028, with a longer implementation cycle and limited short-term performance support, which disturbed market sentiment.

From a medium- to long-term perspective, the recent decline is more likely due to short-term emotional adjustments and capital flow rhythms, and the industry’s long-term growth logic remains unchanged.

Huaxi Securities stated that currently, external geopolitical risks persist, and market risk appetite has decreased, which may impact short-term market volatility. However, AI remains a key investment theme in the near term. AI development is still in the scale-up and acceleration phases, and as the supply system for related computing chips gradually enriches, we believe application development continues to drive demand for tokens. The underlying infrastructure, such as optical modules, is still expanding.

Seize opportunities from AI hot events by quickly deploying the “computing power + AI applications” theme through the GEM Artificial Intelligence ETF (159363) and off-exchange connections (Class A 023407, Class C 023408), directly benefiting from the explosive growth of AI commercialization. Sector-wise, about 60% of the GEM AI ETF’s holdings are in computing power (leading optical module and IDC companies), and about 40% are in AI applications, representing not only core “computing power” but also genuine “AI application” leaders.

Data sources: Shanghai and Shenzhen Stock Exchanges, etc.

ETF-related fee disclosures: When investors subscribe or redeem fund shares, the subscription or redemption agency may charge a commission up to 0.5%. On-exchange trading fees are based on the actual charges by securities firms; no sales service fee is collected. For the connection funds: The GEM Artificial Intelligence ETF Launch-Style Connection C does not charge a subscription fee; redemption fee within 7 days is 1.5%, after 7 days (inclusive) is 0%; sales service fee is 0.3%. The GEM Artificial Intelligence ETF Launch-Style Connection A charges a subscription fee of 1% for amounts below 1 million yuan, 0.6% for 1-2 million yuan, and a flat 1,000 yuan for amounts above 2 million yuan; redemption fee within 7 days is 1.5%, after 7 days (inclusive) is 0%; no sales service fee.

*Institutional opinion reference: Huaxi Securities “Focus on Major AI Conferences and Exhibitions This Week”

Risk warning: The GEM Artificial Intelligence ETF Huabao passively tracks the GEM AI Index, which is based on the index date of December 28, 2018, and was published on July 11, 2024. The annual gains and losses of the GEM AI Index from 2021 to 2025 are 17.57%, -34.52%, 47.83%, 38.44%, and 106.35%, respectively. The index components are adjusted periodically according to the index rules, and past backtest performance does not predict future performance. The index components shown are for display purposes only; individual stock descriptions are not investment advice and do not reflect holdings or trading activity of any fund managed by the manager. The risk level of this fund, as assessed by the fund manager, is R4—medium-high risk, suitable for active investors (C4) and above. Suitability matching opinions are subject to the sales institution. All information in this article (including but not limited to individual stocks, comments, forecasts, charts, indicators, theories, or any form of expression) is for reference only; investors are responsible for their own investment decisions. Furthermore, any opinions, analyses, or forecasts in this article do not constitute investment advice and the fund manager is not responsible for any direct or indirect losses resulting from the use of this content. Fund investments carry risks; past performance does not guarantee future results. The performance of other funds managed by the fund manager does not imply performance guarantees. Invest cautiously.