Hong Kong stocks slammed by JD.com after share placement deal while market waits for Meituan earnings surprise
- JD.com to pick up US$692 million worth of new shares in JD Logistics; other investors to buy US$398 million block at 10 per cent discount
- Meituan and SenseTime are both due to issue their earnings report cards after close of trading today
The Hang Seng Index slid 2.5 per cent to 21,404.88 at the close of Friday trading, sending the benchmark to 0.1 per cent loss for the week. The Tech index slumped 5 per cent, while the Shanghai Composite Index slid 1.2 per cent.
The logistics unit plunged by a record 14 per cent to HK$19.84. The firm separately raised US$398 million by selling 150.5 million new shares to outside investors. Both placements were priced at HK$20.71 each, a 10 per cent discount to the market, according to stock exchange filings.
Elsewhere, WuXi Biologics and Alibaba Health each plunged more than 8 per cent, while Tencent Holdings slipped 2.6 per cent to HK$356.40 for a second day of losses after reporting slower revenue and earnings last quarter. Alibaba Group Holding dropped 5.6 per cent to HK$107.40.
“After the decent rebound we have seen, corporate results and [listed companies’] business outlook is now becoming the focus and test for the market now,” said Ping An Securities in a report.
Meituan slid 8.2 per cent to HK$135 before its earnings report card later Friday. China’s biggest on-demand delivery platform operator is expected to narrow its fourth-quarter loss to 7.2 billion yuan (US$1.1 billion) from 10 billion a quarter earlier.
Sentiment weakened after the US said it was premature to expect a deal with China regarding the status of Chinese companies listed in US exchanges. The Public Company Accounting Oversight Board on Thursday said it’s uncertain if Beijing would allow a full review of their audit papers.
Guangzhou Lushan New Material, which makes adhesive material, surged 44 per cent to 37.14 yuan on the first day of trading in Shanghai. Another debutant Changzhou Xiangming Intelligent Drive System jumped 64 per cent to 48.62 yuan in Shenzhen.
Other Asian markets were mixed, as traders continued to weigh the fallout from surging inflation following a spike in commodity prices. US stocks rose overnight on a strong employment report.