Asia stock market just experienced a “black Monday” – with the Hong Kong market being the biggest loser, wiping out HK tech index’s gain in the past year.
Loser?! What happened?
For the past few days, the Chinese government has been cracking down on local giants. From slapping fines to putting out restrictions… and even turning them into non-profit.
- Antitrust, again and again. During the weekend, Tencent was ordered to give up its exclusive music streaming rights and pay a fine for supposed anti-competitive behavior.
- Meituan, the local food delivery giant, was also ordered to improve compensation for their drivers, harming their business model.
- The summit didn’t look good 🤯 Yesterday’s US-China summit had a harsh opening. This made investors concerned that the US-China relationship may further deteriorate.
Plus, the super shaky crackdown on the local education sector – almost destroyed the sector. Investors can hardly be happy with so many negatives.
So the whole market was down, down, and down…
Company: Reflecting the education crackdown, nearly all education firms saw their shares plunge by 30%+. TAL Education (TAL.US) plummeted by 80% in 2 days.
- Impacted by the antitrust concern, Meituan lost 15%, Alibaba lost 6%, and Tencent lost 7%. Other tech stocks were also down. 📉
Overall: Hong Kong’s Hang Seng Index fell 4%, leading the loss across Asia. The city’s Hang Seng Tech index lost almost 7% – nearly back to its starting point last year. China’s onshore market was also dragged down by 3%.
Just want to say: 🤦