Mainland stocks surged to a fresh decade-high on Friday, with the Shanghai benchmark climbing above the 3,800 mark as renewed optimism over domestic artificial intelligence added more fuel to the liquidity-driven rally.

In Hong Kong, the benchmark Hang Seng Index ended trading for the day up 234 points, or 0.93 percent, at 25,339.

The Hang Seng China Enterprises Index climbed 1.17 percent to end at 9,079 while the Hang Seng Tech Index soared 2.71 percent to end at 5,647.

Across the border, the benchmark Shanghai Composite Index ended up 1.45 percent at 3,825 – the highest level since August 2015, pushing the weekly gain to 3.5 percent in its best run since November 2024 – while the Shenzhen Component Index closed 2.07 percent higher at 12,166.

The combined turnover of these two indices was 2.55 trillion yuan, up from 2.42 trillion yuan on Thursday.

Stocks related to semiconductors and securities trading firms led gains while stocks related to steel and banks suffered major losses.

The ChiNext Index, tracking China's Nasdaq-style board of growth enterprises, increased 3.36 percent to close at 2,682.

"Both individual and institutional investors are accelerating the asset reallocation and shifting money away from bonds to stocks," said Cheng Yu, a portfolio manager at the China fund unit of Allianz Global Investors.

"There's growing consensus that we're seeing a bull market in the making."

Domestic AI-related shares led the surge onshore on Friday, with the CSI Semiconductor Industry Index up 9.5 percent and the CSI Artificial Intelligence Index up 6.6 percent.

Chip maker Cambricon Technology and Hygon Information Technology each climbed by the 20 percent daily limit to record highs. Industry giant SMIC jumped over 14 percent.

The tech rally gained momentum after a report that Nvidia has asked Foxconn to suspend work on the H20 chip, the most advanced model the US company is currently allowed to sell in China.

That came after DeepSeek released an upgrade to its flagship V3 AI model on Thursday with domestic semiconductors supports, underscoring Beijing's push toward chip self-sufficiency. (Reuters/Xinhua)