Hong Kong stocks slip as PDD’s profit slump rattles Alibaba, e-commerce rivals
PDD’s overnight slump in New York infected e-commerce stocks amid concerns price discounting will erode margins
The Hang Seng Index fell 0.5 per cent to 23,258.31 on Wednesday, while the Hang Seng Tech Index slipped 0.2 per cent. On the mainland, the CSI 300 Index lost 0.1 per cent and the Shanghai Composite Index was little changed.
Alibaba Group Holding retreated 2 per cent to HK$115.70 and JD.com slid 1.4 per cent to HK$126.50, while Meituan lost 0.5 per cent to HK$131.40. Among other loss leaders, Hansoh Pharmaceutical slumped 3.4 per cent to HK$25.65, EV maker BYD weakened 2.7 per cent to HK$407 and chipmaker SMIC retreated 2.5 per cent to HK$40.80.
PDD, the owner of Pinduoduo and Temu platforms, reported a 47 per cent slump in first-quarter earnings as growth in sales slowed, both trailing market consensus, a filing on Tuesday showed. Its Nasdaq-listed shares tumbled as much as 18 per cent in New York overnight.
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Sub-par results from some bellwether companies may upend a rebound in the Hang Seng Index, which has risen 17 per cent from an April low. Analysts said earnings reports from more Hang Seng Index members would have a bigger sway on the city’s stock market direction, as concerns over the US-China tariff war eased.