Tech stocks from Meituan to Alibaba lead losses in Hong Kong as Chinese ride-hailing giant Didi prepares for US delisting
- Losses were exacerbated by US regulators finalising plans for a new law that could see Chinese companies booted off American bourses
- The Hang Seng Index retreated on Friday, reversing two days of gains and putting it on track for a weekly loss
The Hang Seng Index retreated 0.1 per cent to 23,766.69 at the close of Friday trading, reversing a two-day gain to finish the week down 1.3 per per cent. That was its third straight weekly loss. The Hang Seng Tech Index slid 1.5 per cent on Friday, while China’s Shanghai Composite Index rose 0.9 per cent.
Alibaba, the owner of this newspaper, sank 2.6 per cent to HK$119.40, deepening a rout as it continues to trade at a record low. Food delivery platform operator Meituan declined 2.7 per cent, while online gaming giant Tencent lost 2.3 per cent.
03:07
Stop offering ‘untrusted’ Chinese apps like TikTok and WeChat, Washington urges US tech companies
“Declines in the Hang Seng Index have been led by Chinese tech stocks following weak overnight returns. More broadly, US markets have been weak on Omicron concerns and the Fed chair’s hawkish comments,” said Stephanie Leung, head and deputy chief investment officer at wealth management firm StashAway HK.
Blighted by poor third-quarterly earnings reports last month, tech giants are now suffering losses sparked by concerns that Chinese companies could soon be booted off American bourses. The Securities and Exchange Commission (SEC) moved closer to passing a new law on Thursday that would aim to ensure foreign firms, in particular Chinese companies, comply with audit requirements.
Since its peak on February 17, successive sell-offs in the Chinese tech sector have wiped out about US$1 trillion of market value in the Hang Seng Tech Index. The Nasdaq Golden Dragon China Index, which tracks US-listed Chinese stocks, sank to its lowest in almost 19 months on Thursday.