A staff member works at a workshop of a semiconductor company in Shanghai, east China, Feb. 10, 2020. (Xinhua/Ding Ting)

China's semiconductor-related shares closed higher on Friday — with some even rising by the daily limit — as the market is buoyed by media reports claiming the Chinese government is preparing to fully support the development of the third-generation semiconductor industry between 2021-2025. 

The upswing trend stands in stark contrast to the "freefall" of US stocks on Thursday, led by a slump in chipmakers' shares. Investors showed concern that the rise of China's homegrown chip industry could weaken the revenue of US semiconductor producers, some of which are heavily dependent on the Chinese market.

On Friday's closing, Shares of Chinese chip designer Xiaocheng Tech rose 20 percent, the daily ceiling, while shares of Techsem climbed 16.28 percent. 

The rally comes after Bloomberg reported on Thursday (US time) that a suite of measures including research, education and financing that are designed to bolster the development of third-generation semiconductors will be added to the China's 14th five-year plan (2021-2025). 

Industry observers expect the plan will lay a "top-down" design for the development of China's semiconductor industry and speed up the growth of the domestic industry amid US restrictions on China's tech companies.

In contrast to China's A-share market, major US chipmakers posted one of their worst performances in recent months. Shares of Nvidia Corp tumbled 9.3 percent, while Broadcom Inc and Qualcomm dropped by 6.1 percent and 5.5 percent, respectively.

Global Times