Hong Kong stocks clobbered with tech index in record plunge on China regulatory fears, US investment concerns

Tencent and Meituan led losses among tech stocks in Hong Kong as traders opted to avoid the unknown in China’s ongoing regulatory clampdown

Offshore investors dumped mainland stocks by the most in a year on Monday amid market meltdown

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An investor looks at computer screens showing stock information at a brokerage in Shanghai. Photo: Reuters

Published: 10:44am, 27 Jul 2021Updated: 11:38pm, 27 Jul 2021

Hong Kong stocks sank to an eight-month low, with the market’s technology barometer suffering a record crash on its first anniversary, as investors dumped their holdings to avoid growing risks in China’s regulatory rampage. Concerns about US investment ban accelerated losses.

The Hang Seng Index fell 4.2 per cent to 25,086.43 at the close of trading, the most in 14 months. The slide has now snowballed to just shy of 10 per cent over three days, dragging the benchmark to the lowest since November. The Hang Seng Tech Index tanked 8 per cent, the most since it was introduced a year ago.

Stocks in mainland China markets also slumped after offshore funds exited the market at the fastest clip in a year while state-run media attempted to talk up the market. The onshore yuan and Hong Kong dollar fell to 6.5040 and HK$7.7810, their weakest against the US dollar in more than three months, according to Wind and Reuters data.

Tencent Holdings tumbled 8.9 per cent to HK$446.00, the biggest drop in nearly a decade, leading losses among tech index peers. Meituan plunged 17.7 per cent. Alibaba Group Holding, the owner of this newspaper, fell 6.4 per cent after earlier slipping below its November 2019 IPO price of HK$176. All but two of the 30 tech constituents declined.

Today’s losses added to more than US$570 billion of value destruction on Monday in indices of Chinese stocks from onshore markets to Hong Kong and New York. China launched a new nationwide campaign to purge what it deems problems in the internet industry, which has been battered for months in an almost continuous crackdown from different government bodies.

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