Chinese tech stocks fell as Hong Kong markets reopened after holiday, facing renewed worried on growth and regulatory risks triggering another round of sell off.
The Hang Seng Tech plunged as much as 7% early Tuesday before paring losses. Key equities gauges across the region all slumped, with an index of Chinese firms in the city sliding more than 4%.
In China, “economic figures to be released in coming weeks can be quite ugly given the Covid lockdowns,” said Banny Lam, head of research at CEB International Investment Corp.
“The situation may calm down in Shanghai in May or June, but still, the Covid controls are worrying investors. The road will remain bumpy.”
Meantime, Chinese regulators further tightened their oversight on the internet industry over the weekend, banning younger users from sending virtual gifts on livestream platforms.
While Hong Kong’s market was shut for a public holiday on Monday, Chinese Premier Li Keqiang warned of a “complicated and grave” employment situation as Beijing and Shanghai tightened curbs on residents in a bid to contain recent outbreaks. Chinese exports also weakened to the slowest pace since the early days of the pandemic, capturing the impact of Covid restrictions on the trade and manufacturing hub of Shanghai.
BlackRock Inc. said it’s jettisoning its bullish stance on China given the lockdowns.
Chinese authorities have made repeated promises in the past couple months to support the economy and stabilize markets, but that’s so far failed to give a sustainable boost to stock prices.