As expected, Wednesday’s tech selloff on Wall Street spread to Asia, denting the high-flying Hang Seng and sending Tencent tumbling the most since August.
The Hang Seng – which no one should feel sorry for, because it’s still up 33% YTD – has fallen for four straight sessions, the worst streak since June:
That came in no small part courtesy of Tencent, which has now fallen more than 7% from the record high hit earlier this month:
The Hang Seng Composite Info Tech Index dove 3.2%. “The technology sector is under pressure after the overnight selloff on the Nasdaq,” DBS Bank’s Frank Lee remarked, adding that “the index correction will probably be short lived as capital rotates to the traditional financial industry, rather than leaving the market.” Thanks, Frank.
Here’s some further color from SCMP:
Tencent Holdings was pushed out of the half-a-trillion-dollar club after just 10 days, as declines in tech stocks spread from the United States to Asia on Thursday.
The Chinese internet giant had US16.5 billion wiped off its value after its shares fell by 3.3 per cent to HK$398 (US$51) at close of trade in Hong Kong.
The company became Asia’s first company to exceed half a trillion US dollars in capitalisation on November 21. On Thursday its market cap stood at US$484 billion.
It also contributed 118 points — or 26 per cent — towards the losses on the Hang Seng Index, which dropped 446.48 points, or 1.5 per cent, to finish at 29,177.35 on Thursday. Shares worth HK$22.4 billion changed hands, the most for a single stock on the Hong Kong market.
Meanwhile, on the mainland, things got ugly in the afternoon session. The SHCOMP closed 0.6% lower and notably, November was the worst month for the index since December:
Here’s a look at the benchmarks on the month with the Shenzhen the worst and the CSI 300 essentially flat:
As you might imagine, Samsung was hit on Thursday as was the Kospi – another reaction to the Wednesday Wall Street tech turmoil (also note that the BoK hiked rates, as expected overnight, although it was widely seen as a hike of the “dovish” variety):
“Today’s turmoil in the region’s tech stocks was sparked by the sell-off in their peers on Wall Street last night,” First Shanghai Securities’ Linus Yip, told SCMP. “The year-to-date surge in the sector has been a bit too fast and too much. A consolidation is reasonable.”
Ok, so no more FANG fumbling please, because clearly, big cap tech is the rug that really ties the room together, does it not?
