Hong Kong stocks slipped amid a sell-off in Alibaba Group Holding after a report suggested its major investor SoftBank Group is preparing to sell all its stake in China’s biggest e-commerce platform operator. Tencent Holdings and BYD extended losses.
The Hang Seng Index lost 0.3 percent to 20,249.04 as of 10.40am local time. The Tech Index declined 0.8 percent while the Shanghai Composite Index of onshore equities was little changed.
Alibaba Group sank as much as 4 percent to HK$92.25, erasing HK$79 billion (US$10.1 billion) from its market value before recovering to HK$93.95. Tencent slid 2.2 percent HK$349.20 and BYD also weakened 2.2 percent to HK$217.80, adding to losses on Wednesday as corporate insiders retreated. JD.com fell 5.3 percent to HK$145 and Meituan slipped 3.3 percent to HK$126.70.
What moved the Hang Seng Index?
SoftBank has decided to sell almost all of its remaining interest in Alibaba Group and limit its exposure to China, the Financial Times reported on Thursday. The investor will eventually trim its stake to just 3.8 percent based on prepaid forward contracts based on regulatory filings, the report said.
The Tokyo-based investor last reported owning 5.07 billion ordinary shares in Alibaba Group and 633.4 million of its American depositary shares, according to recent company reports, giving it an effective 23.9 percent stake in the Chinese company. Alibaba is the owner of this newspaper.
The Hang Seng Index has lost 1.9 percent so far this week, pressured by reports that major investors are exiting from some of the biggest Chinese companies. Amsterdam-listed Prosus is preparing to further cut its stake in Tencent, while Berkshire Hathaway sold another block of BYD shares on March 31.
Major Asian markets traded lower. The S&P/ASX 200 in Australia dropped 0.3 percent and the Nikkei 225 in Japan declined 0.1 percent while the Kospi in South Korea was little changed.