Hong Kong stocks sink with Meituan, Alibaba losses amid tech clampdown concerns, slower Chinese manufacturing
- Hang Seng Index logged biggest drop in a month as Meituan, Alibaba Group and Tencent pulled tech stocks lower
- A government report on Friday showed Chinese manufacturing slowed this month by more than economists expected
Meituan fell by 3.6 per cent to HK$298, while Alibaba Group Holding retreated 2.8 per cent to HK$225, among the worst performers of Hang Seng constituents. Tencent Holdings slipped 1.4 per cent to HK$623. The Hang Seng Tech Index slumped 2.2 per cent.
“The increased scrutiny of tech companies will be a global and long-running issue now,” said Jin Xiangyi, an analyst at Huachuang Securities. “Against this backdrop, the leading market players will boost investments for structural growth opportunities, which will further intensify competition among them.”
The Hang Seng Tech Index has lost more than HK$2.2 trillion (US$283 billion) in market value from its February 17 peak.
Those concerns were a blemish to an otherwise big recovery for Hong Kong stocks this month, when the benchmark reached the highest level since March 18. They conspired to trim the Hang Seng Index’s advance in April fuelled by recovering sentiment, after a 2.1 per cent loss in March.
Stocks also weakened today after China’s statistics bureau said the Purchasing Managers’ Index (PMI) on manufacturing fell to 51.1 this month from 51.9 in March. The decline was larger than the median estimate of 51.8 in a survey of economists by Bloomberg.
Three companies started trading for the first time on mainland bourses. Jiangxi GETO New Materials Corp surged 225 per cent from its initial public offering price to 48.10 yuan in Shenzhen as the best performer. Zhejiang Huasheng Technology and Jiahe Foods Industry both advanced by 44 per cent in Shanghai.
Markets in mainland China will close from Monday to Wednesday next week for public holidays.