Hong Kong stocks dropped on Tuesday, led by declines in technology companies and automakers, as investors took profits amid a lack of strong market drivers. This came despite solid gains in the U.S. markets the previous day.
The Hang Seng Index fell 2.1% to 23,395.31 by 11:34 a.m., while the Hang Seng Tech Index dropped 3.4% to 5,543.28. On the mainland, both the CSI 300 Index and the Shanghai Composite Index saw a slight decline of 0.2%.
The biggest losses came from BYD Electronic International, a chipmaking division of BYD, the world’s largest electric vehicle manufacturer. BYD Electronic plummeted 9.1% to HK$42.70. BYD itself fell 3.4% to HK$389.60, even after reporting a 73% increase in its fourth-quarter profit, which reached a record 15 billion yuan (US$2.1 billion).
Xiaomi, which makes smartphones and electric vehicles, dropped 5.2% to HK$50.4. The company had raised US$5.5 billion in a share sale, selling 800 million shares at HK$53.25 each to fund its car-making business expansion.
Other electric vehicle companies also saw declines. Xpeng dropped 7.8% to HK$78.90, Geely Auto fell 4.9% to HK$16.8, and Li Auto slid 4.1% to HK$100.90.
Ivan Li, a fund manager at Loyal Wealth Management in Shanghai, noted that “skittish investors chose to cash out to lock in their gains, expecting volatility ahead.” He added that most investors are still likely to continue investing in Chinese technology and EV stocks.
Two companies began trading on Tuesday. Nanshan Aluminium International Holdings lost 3.4% to HK$25.7 in Hong Kong, while Wintech-Nano Suzhou surged 198.5% to 27.10 yuan in Shanghai.
Across the Asia-Pacific region, markets were mixed. Japan’s Nikkei rose 0.6%, Australia’s S&P/ASX 200 gained 0.3%, and South Korea’s Kospi fell 0.4%.
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