Hong Kong stocks fall in volatile session on US move to restrict Chinese tech investment

The Hang Seng Index recovers ground after trading lower earlier in the session

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People cross the street in Central. Photo: Edmond So

Published: 10:39am, 25 Feb 2025Updated: 4:37pm, 25 Feb 2025

Hong Kong stocks swung wildly in a volatile trading session on Tuesday, as geopolitical tensions flared up following the US’ move to restrict Chinese investment in American technology and infrastructure.

The Hang Seng Index fell 1.3 per cent to 23,034.02 at the close after dropping by as much as 2.7 per cent earlier in the day. The Hang Seng Tech Index, which has recently benefited from euphoria over DeepSeek’s artificial intelligence (AI) breakthrough, ended the day down 1.6 per cent after trading 4.4 per cent lower earlier.

On the mainland, the CSI 300 Index slid 1.1 per cent and the Shanghai Composite Index retreated 0.8 per cent.

Alibaba Group Holding tumbled 3.8 per cent to HK$130.60, following a 10 per cent plunge in its American depositary receipts overnight. The company said it would invest at least 380 billion yuan (US$52.4 billion) in its cloud computing and AI infrastructure over the next three years. That would be China’s largest-ever computing project financed by a single private business. Alibaba owns the Post.

Tencent Holdings lost 2.5 per cent to HK$484.80. Meituan slid 4.7 per cent to HK$158.60 and Baidu dropped 3.9 per cent to HK$86.

The Nasdaq Golden Dragon China Index, which tracks US-listed Chinese tech companies, tumbled more than 5 per cent overnight after US President Donald Trump unveiled a memorandum last week that seeks to curb investments from China in critical industries. The memorandum said the administration would “use all necessary legal instruments”, including the Committee on Foreign Investment in the United States, to block China-affiliated investments in technology, critical infrastructure, healthcare, agriculture, energy, raw materials, or other strategic sectors.