Hong Kong stocks hit six-week low as Alibaba, Meituan lead tech slump on earnings concerns
Hong Kong stocks dropped for a fifth day to the lowest level in six weeks amid lingering concerns about poor earnings from Chinese technology juggernauts.
The Hang Seng Index slumped 1.1 per cent to 24,674.40 in early Tuesday trading, heading for the lowest close since October 6. The Hang Seng Tech Index slid 1.6 per cent, while the Shanghai Composite Index gained 0.2 per cent.
Techtronic Industries and sportswear maker Li Ning were the worst performers on the Hang Seng Index, falling by at least 3.7 per cent. Kuaishou, the biggest constituent on the Hang Seng Tech Index, dropped 2.6 per cent and Meituan sank 3.3 per cent. Alibaba Group Holding tumbled 2.8 per cent.
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Sentiment soured again before the quarterly report card from Kuaishou Technology later Tuesday. The short-video sharing platform operator probably incurred a loss of 8.6 billion yuan last quarter, while loss at Meituan may have widened to 5.25 billion yuan from the previous three-month period, according to analysts tracked by Bloomberg.
The past week has been chastening for investors who deemed the worst for Chinese technology companies has passed. A slide in earnings at Alibaba, the owner of this newspaper, triggered another bout of sell-off, lopping US$163 billion off such stocks listed in Hong Kong and New York.
Other major markets in Asia all retreated except Australia, taking cues from an overnight decline in US equities. The reappointment of Jerome Powell as Fed chair fanned speculation about faster tapering, sending Treasury yields higher.
This article originally appeared on the South China Morning Post (SCMP), the leading news media reporting on China and Asia. For more SCMP stories, please download our mobile app, follow us on Twitter, and like us on Facebook.
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