China’s Tech Stocks Dip to a New Low – Led by Alibaba
Stocks of Chinese technology fell for the third consecutive session; Against the backdrop of new concerns over the sector’s Beijing regulatory plans. The Hang Seng Tech Index fell 1.9% on Tuesday. It thus reached its lowest closure since its inception in 2020. Alibaba was among the biggest losers. The Hang Seng index dropped 2.7%. This sought to undermine the impact of the large-scale Chinese crackdown on private enterprises. HSBC Holdings Plc also announced a tax related to its exposure to its Chinese commercial real estate; While global stocks are under pressure due to escalating tensions in Ukraine.
Meituan decreased by 5.1%; After Beijing on Friday ordered him to cut taxes. Tencent Holdings has eliminated trading losses. After denying that, It faces a new audit of its core business. The Hang Seng index halved from a peak in February last year; With the Beijing Antitrust Campaign for the second year in a row.
The question is how much it will affect the revenue of large internet companies in the long run and if they are required to take on increasing social responsibility. The growth rate of the technology sector has been going on for decades. Until the common well-being suddenly stopped. The attack, which began in late 2020, took place in almost every corner of the industry; From digital business, data security, online games, and overseas applications.
World Stocks and Tension
According to reports, members of the Hang Seng Tech Index lost a total of $1.6 trillion after the peak in February last year. The impact on technical profits will appear again on Thursday; When Alibaba has to make an estimated 60% drop in quarterly profits. It is worth noting that global funds and analysts were more optimistic about the sector by the end of 2021. However, the shares sustained a loss in 2022; Recent new measures have made global funds more cautious.
The MSCI Asia Pacific Index fell 2.1%. In total, it dropped to a minimum in three weeks. After the Russian president recognized the two self-proclaimed separatist republics in eastern Ukraine. Also ordered peacekeeping forces in the regions. The US government has warned that the accumulation of troops near Ukraine signals a possible invasion, which the Kremlin repeatedly denied. The Nikkei 225 Stock Average lost 1.7%. All sectors of the MSCI Asia Pacific Railroad have fallen. It is worth noting that energy has suffered the least due to rising oil prices. The US condemns Russia’s move to the UN and calms down Kyiv. Britain and the United States have also said they will impose additional sanctions on Russia in response to Putin’s move. This hampered European-mediated peace talks; The State Department also forced the evacuation of personnel. Analysts expect increased levels of financial instability in global markets. Rising prices could stifle demand and lead to higher inflation.
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