China’s Showcase of AI Chip Prowess Triggers $240 Billion Rally

From Huawei Technologies Co. to Alibaba Group Holding Ltd., China’s biggest tech firms have vied with each other this month to tout their latest AI chip advancements. Their growing public swagger is gaining investors’ attention, igniting a $240 billion stock market rally.

On Thursday, Huawei for the first time publicly laid out its three-year roadmap for chip development, boasting of “super clusters” and vastly faster AI chips intended to supplant restricted Nvidia Corp. accelerators. A day prior, state media showcased Alibaba’s growing footprint within the country’s No. 2 wireless operator.

The twin developments follow a panoply of revelations about ...