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Chinese optical stocks fall on report of potential US data center import ban
Zhongji Innolight, a major transceiver supplier, dropped as much as 14% in Shenzhen before paring losses, while Eoptolink fell 11% as investors weighed potential hit to growth tied to the US AI buildout.
Chinese optical and data center component stocks slid after a Reuters report said the US is drafting an import ban on some Chinese data center components aimed at protecting AI infrastructure, according to LiveMint Markets.
LiveMint Markets reports that Zhongji Innolight Co. led the move, falling as much as 14% in Shenzhen before trimming its loss, while peer Eoptolink Technology Inc. fell 11%, with concerns centered on how a US regulatory action could affect Chinese firms’ outlook given their exposure to AI infrastructure spending.
The article notes the selloff also reflects worry about the FCC’s proposed ban, which targets risks such as installing malware or stealing data from data centers that are central to the AI boom.
LiveMint Markets adds that industry groups and market participants expect the news to act as a near term overhang for Chinese optical module suppliers, potentially delaying new product rollouts in the US and slowing capacity expansion plans, while the longer term response may require accelerated innovation and improved competitiveness.