China’s double-listed tech giants have lost around $ 60 billion together

Alibaba founder Jack Ma attends the 5th World Zhejiang Entrepreneurs Convention on November 13, 2019 at the Hangzhou International Expo Center in Hangzhou, Zhejiang Province.

VCG | Getty Images

China’s double-listed tech giants – Alibaba, Baidu, and Netease – have lost a total of billions in market value in just a few days.

The losses are due to the risk of possible de-registration from US exchanges.

At the close of trading on Friday in Hong Kong, the market capitalization of the four listed technology stocks fell by $ 468.64 billion (approximately $ 60.31 billion) in three days. This is evident from CNBC calculations of data accessed through Refinitive Eikon.

Here’s a list that shows how much each of the companies that are also listed in the United States lost in market capitalization.

Between Tuesday and Friday in Hong Kong:

  • Alibaba: Hong Kong $ 303.1 billion ($ 39 billion) lost
  • Baidu : HK $ 107.54 billion lost
  • HK $ 30.674 billion lost
  • Netease: HK $ 27.334 billion lost

Notable among them is Baidu, China’s largest search engine, which made a lackluster debut on Tuesday in its secondary listing in Hong Kong. The share ended unchanged on the first day of trading.

On Wednesday, the US Securities and Exchange Commission passed a law that threatens to remove companies from US exchanges if they do not meet US auditing standards.

The law, known as the Holding Foreign Companies Accountable Act, was passed by the administration of former President Donald Trump.

Companies identified by the SEC must be vetted by a U.S. watchdog and proven that they are not owned or controlled by a government agency in a foreign jurisdiction. Corporations must also designate all board members who are Chinese Communist Party officials, the SEC said in a statement Wednesday.

In addition to these regulatory uncertainties, China’s tech firms face potential challenges domestically as Beijing gains a tighter grip on the fast-growing sector and enacts antimonopoly laws for financial technology and e-commerce.

Reuters reported earlier this week that the founder of the Chinese tech conglomerate Tencent met with Chinese antitrust officials this month to discuss compliance with his group.

In a high-profile move last year, Ant Group’s IPO, touted as the largest in the world, was abruptly suspended a few days before its debut. Alibaba’s billionaire founder Jack Ma is the controller of Ant Group.

Aside from these concerns, the entire tech sector around the world has also come under pressure as bond yields have risen. Rising returns hurt growth stocks, many of which are in the tech sector, as they decrease the relative value of future earnings.

If optimism rises about a possible global economic recovery after the pandemic, investors could try shifting their portfolios away from technology and into other areas like stocks, which rise as the economy recovers.

– CNBC’s Arjun Kharpal contributed to this report.

Source link

Posted in Tech

Leave a Comment

Thanks for visiting get comfortable with the space, consider donating all donations big or small entitle you to a free gift with free shipping.