Tech stocks hit new all-time low in Hong Kong
06:12, 6 December 2021
Technology stocks listed in Hong Kong took a heavy beating on Monday as souring investor sentiment following DiDi Global’s US delisting continued to weigh down the sector.
Hang Seng TECH Index hit a new all-time low of 5749.75 points, dropping over 2.8% by Monday afternoon. The index was down nearly 30% in 2021, as of Monday afternoon.
China-based ride-hailing company DiDi Global last week announced its decision to delist from US markets and instead pursue a Hong Kong listing following intense scrutiny from Beijing authorities. DiDi stock plunged over 22% to $6.07 on Friday in New York.
Evergrande likely to default
Weakness in tech stocks dragged Hong Kong’s benchmark Hang Seng Index 1.2% lower to 23,476 points on Monday. The benchmark index was on track to close at its lowest since 30 September 2020.
Cash-strapped property developer Evergrande fell to an 11-year low on Monday after the company flagged the likelihood of a default, saying “there is no guarantee that the Group will have sufficient funds to continue to perform its financial obligations”.
On Monday, e-commerce giants Alibaba Group and JD.com were among the top 10 worst performer on the benchmark index, down 5.1% and 3.5%, respectively. Hong Kong-listed shares in Alibaba Group are down over 50%, as of Monday afternoon.
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SoftBank Group on a seven-day losing streak
Elsewhere, Nikkei 225 Index fell 0.4% to 27,908 on Monday as Vision Fund manager SoftBank Group emerged as the biggest intraday percentage loser on the benchmark index.
SoftBank Group slumped over 8% and was on track to close lower for the seventh consecutive day on Monday.
Masayoshi Son-led SoftBank Group’s recent slump in share prices is due to downturn in the fortunes of its investment in DiDi Global and Alibaba Group. Regulatory setback in its sale of UK-based semiconductor firm Arm to US-based chipmaker Nvidia has further dragged SoftBank Group stock to near one-and-an-half year low.