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China stock market
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Hong Kong stocks fall most in two months amid concerns about China tech giants Meituan and Didi, new coronavirus variant

  • Hang Seng Index caps steepest loss since September 20, ahead of Meituan’s earnings and on media reports about Didi’s possible US delisting
  • Meituan’s third-quarter loss may have widened to 7.04 billion yuan (US$1.1 billion), according to a consensus estimate

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Media reports that Chinese regulators had asked ride-hailing giant Didi Global to delist its shares trading in the US have added to an already bearish mood as far as Chinese technology stocks are concerned. Photo: AFP
Zhang Shidong
Hong Kong stocks dropped the most in two months on Friday, on mounting concerns about the Chinese technology sector and a new variant of the coronavirus of which two cases were reported in the city this week.
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The Hang Seng Index sank 2.7 per cent to 24,080.52 at the close, posting its steepest loss since September 20. The 60-member benchmark’s decline was broad-based, with 59 stocks falling. It declined 3.9 per cent for the week, the most in two months.

The Hang Seng Tech Index slumped 3.3 per cent on Friday, while China’s Shanghai Composite Index slid 0.6 per cent.

Sentiment around local stocks has taken a beating amid expectations that third-quarter losses at Meituan, whose result are due later on Friday, probably widened, and because of media reports that Chinese regulators had asked ride-hailing giant Didi Global to delist its shares trading in the US because of a possible leak of sensitive data.

Meituan, China’s biggest on-demand services delivery firm, slid 3.9 per cent to HK$263.60. Its losses may have widened to 7.04 billion yuan (US$1.1 billion) from the second quarter based on the US accounting standard, according to a consensus estimate by 14 analysts tracked by Bloomberg.

The reports about Didi have added to an already bearish mood as far as Chinese technology stocks are concerned. These shares have rattled the market over the past few weeks after a flurry of surprise earnings misses. While some investors had earlier argued that these stocks were already cheap enough to buy after Beijing’s regulatory crackdown, worsening earnings situations have thrown this idea into doubt.

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