Tech stocks sink in Hong Kong on renewed concerns about regulations as China slows the approval for online games
- Hang Seng Index tumbled 2.3 per cent, the biggest drag in more than six weeks as tech giants paced losses
- Tech benchmark sank 4.5 per cent after Beijing summoned Tencent, NetEase and others, and said to slow the approval for new online titles
The Hang Seng Index tumbled 2.3 per cent to 25,716 on Thursday, the most since a 4.2 per cent setback on July 27. The city’s tech benchmark sank 4.5 per cent, also the biggest loss since July 27. The Shanghai Composite Index climbed 0.5 per cent to 3,693.13, reversing an earlier decline.
Tencent Holdings, China’s biggest developer of online games, led losses with a 8.5 per cent slide while its closest rival NetEase slumped 11 per cent. Alibaba Group Holding, the owner of this newspaper, lost 5.8 per cent while Meituan fell 4.8 per cent.
“The regulatory policies are showing that government is imposing more control in the tech [sector], particularly online gaming,” said Edison Pun, senior market analyst at Saxo Markets. “The Hang Seng and tech stocks are facing strong resistance, so the upside will be very limited given the current situation.”
Education tech companies also slumped. Scholar Education slipped 7.8 per cent while New Oriental Education and Technology lost 5.5 per cent.