The Hang Seng Index fell 1 percent to 17,332.06 at 2:23 p.m. local time, erasing all of this week’s gains. The Tech Index tumbled 2.3 percent, while the Shanghai Composite Index slipped 0.3 percent.
JD.com fell 10 percent to HK$101.10. U.S. retailer Walmart Inc. has raised $3.6 billion by selling its stake in U.S.-listed shares of the Chinese e-commerce platform operator, Bloomberg reported on Wednesday, citing people familiar with the matter. The company sold 144.5 million shares at $24.95 each, an 11 percent discount to the market price, ending a business relationship that had been in place since 2016.
JD.com is a “valued partner,” Reuters reported, citing a Walmart statement. The impending sale will allow the U.S. retailer to focus on its own China business and deploy capital for other priorities, the report said.
Other Chinese technology stocks fell in lockstep following the news. Short video platform owner Kuaishou Technology plunged 10.8 percent to HK$39.60, Alibaba Group Holding lost 1.4 percent to HK$79.30 and smartphone maker Xiaomi lost 1.5 percent to HK$17.42.
“The news has affected the general sentiment on technology stocks,” said Dickie Wong, managing director of Kingston Securities. “Investors, including successful fund managers, are becoming conservative” because many Hong Kong-listed technology companies also have large foreign shareholders, he added.
Instead, investors are looking for undervalued stocks and those that support buyback programs, Wong said. Share buybacks in Hong Kong have hit a historic high of HK$164.8 billion (US$21.2 billion) this year, surpassing last year’s total by 30 percent, according to benchmark creator Hang Seng Indexes Company.
Sunny Optical Technology limited its losses, rising 7.5 percent to HK$48.85 after its quarterly profit beat estimates.
Other Asian markets also weakened, posting losses overnight after the US stock index ended an eight-day winning streak. Japan’s Nikkei 225 lost 0.4 percent and South Korea’s Kospi lost 0.1 percent, while Australia’s S&P/ASX 200 fell 0.3 percent.