JD.com sinks 8.7% in Hong Kong as Walmart dumps shares, slamming Chinese tech stocks
- US retail giant raised US$3.6 billion by selling 144.5 million US-listed shares in JD.com at 11 per cent below market price, according to a Bloomberg report
The Hang Seng Index fell 0.7 per cent to 17,391.01 on Wednesday, erasing all of this week’s advance. The Tech Index tumbled 1.8 per cent, while the Shanghai Composite Index dropped 0.4 per cent.
JD.com sank 8.7 per cent to HK$102.40, erasing HK$28.7 billion (US$3.7 billion) from the company’s market capitalisation in Hong Kong. US retailer Walmart Inc raised US$3.6 billion from the sale of its stake in the the Chinese firm, Bloomberg reported. It sold 144.5 million shares at US$24.95 each in New York, an 11 per cent discount to the market price, to end a relationship cemented since 2016.
JD.com has been a “valued partner”, Reuters reported, citing a Walmart statement. The impending sale will allow the US retailer to focus on its own China operations and deploy capital towards other priorities, the report said.
05:46
Why investors can expect more market volatility after recent global stock sell-off
Other Chinese tech stocks slumped in tandem on the news. Short-video platform owner Kuaishou Technology crashed 9.9 per cent to HK$40, Alibaba Group Holding slipped 0.6 per cent to HK$79.95 and smartphone maker Xiaomi retreated 0.9 per cent to HK$17.52.
“The news affected the overall sentiment on tech stocks,” said Dickie Wong, executive director at Kingston Securities. “Investors, including the well-performing fund managers, are turning conservative” because many Hong Kong-listed tech companies also have big foreign shareholders, he added.
