(Yicai) Sept. 5 -- Shares of Star Market-listed Cambricon Technologies, the Chinese artificial intelligence chipmaker which doubled in value last month, rebounded after tumbling in the wake of the market’s stock index provider announcing plans to rejig constituent weightings.

Cambricon [SHA: 688256] closed 6.6 percent lower at CNY1,281.46 (USD179.54) in Shanghai today, after a 14.4 percent plunge yesterday. The stock has retreated 19 percent since setting a record closing price of CNY1,587.91 on Aug. 29, when Cambricon pushed out multi-year leader Kweichow Moutai to become the Chinese mainland's most expensive stock.

The Shanghai Stock Exchange and the China Securities Index Company announced yesterday that the benchmark Star 50 Index will undergo a regular index adjustment after the market closes on Sept. 12. The rebalancing is usually carried out once per quarter.

Cambricon's weighting in the Star 50 Index had surged to 14.9 percent at the end of trading on Sept. 3, following its recent rally. But according to regulations, a single stock should not have a weighting of more than 10 percent, with the top five stocks combined limited to 40 percent.

As Cambricon's weighting is around 15 percent, and Semiconductor Manufacturing International Corporation's is 10.2 percent, both will be adjusted on Sept. 12, brokerages told Yicai. Star 50 exchange-traded funds are also expected to rebalance, which will impact the stock prices of both Cambricon and SMIC.

Funds tracking the Star 50 Index had combined assets of CNY184.5 billion (USD25.8 billion) as of Sept. 3, according to data from Wind Information. Based on Cambricon's index weighting of 14.9 percent on that day, and the 10 percent single-stock weighting cap, funds would need to sell Cambricon shares worth more than CNY9 billion (USD1.3 billion).

Editor: Futura Costaglione