MSCI China Enters the Bear
On 2021-05-13 (Thursday), MSCI China Index slid 3%, extending losses from its mid February high to more than 20%. This is the 2nd time MSCI China Index fallen into a bear market in a little over a year. Last March, major equity benchmarks slumped following the spread of the Covid-19 pandemic.
Stock benchmarks in Hong Kong and on the mainland are among the world’s worst performers since February as Beijing cracks down on heavyweight tech firms over monopolistic practices, further worsening investor sentiment already soured by concerns of liquidity tightening in China.
According to Bloomber, Tencent Holdings Ltd., Alibaba Group Holding Ltd. and Meituan have accounted for more than 40% of the index’s decline since the February high.
Alibaba tumbled to the lowest in almost a year in New York, after reporting its first quarterly loss since 2012 on Thursday. Investors were disappointed about its results and concerned that its spending outlook could pressure margins.
Meituan, on the other hand, fell for the 10th straight session after an influential consumer group voiced criticism, and its shares are down by almost 50% since February high.
Reference
- Bloomberg, 2021-05-14, “MSCI China Enters Bear Market After Tech Selloff; Alibaba Slumps”
- Bloomberg, 2021-05-11, “Meituan Shares Drop for 10th Session on Consumer Group Criticism”
