Weibo among US-listed Chinese tech stocks rattled by index's biggest one-day drop in four years

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Chinese tech stocks listed on the New York Stock Exchange have lost some of their lustre in recent days. Photo: AFP

Published: 4:45pm, 7 Jul 2015Updated: 2:45pm, 20 Oct 2020

US-listed Chinese tech firms like microblogging site Weibo saw their fortunes dip on Monday as the Bloomberg China-US Equity Index took its biggest hit in four years following a rout of the Chinese stock market last week.

The index sank 5.1 per cent to 121.36 in New York, the steepest drop since September 2011, according to Bloomberg.

In addition to Weibo, big Chinese tech players like software provider Xunlei, online games operator Changyou, and online real estate portal SouFun Holdings all fell by more than 12 per cent, after Beijing's latest efforts to reduce volatility in the Chinese markets apparently did little to calm investors' nerves.

The Chinese market has dropped by a third in the last couple of weeks. In a bid to stabilise the market, Beijing has cut interest rates, suspended IPOs and organised stock purchases by state-run financial firms, among other measures.

Beijing hopes that by putting IPOs on ice, it will increase demand for listed shares.

But while it has created a 120 billion yuan (US$19 billion) stock investment fund by marshalling the resources of its financial firms, the effect may be limited as the fund amounts to less than one-fifth of daily trading volume on the Shanghai Stock Exchange.

The state-run firms will invest up to 15 per cent of their total net assets in blue chip-based exchange traded funds (ETF), according to a joint statement by all 21 brokers.

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