Hong Kong Market Dips to 5-Week Low Amid Meituan’s Slump on Demand Slowdown

Hong Kong's stock market witnessed a notable dip, continuing its downward trend for the fourth consecutive day, as Meituan, the leading food delivery platform in China, issued a warning about an expected decrease in demand. This news prompted investors to sell off shares, contributing to the stock's steep decline.

Meituan Faces a Sharp Decline

Meituan saw its share price fall dramatically, down 10.4 percent to HK$92.25, marking the lowest it has been since April 2020. This share drop came shortly after the company indicated a likely cooling off in its food delivery sector in the imminent quarter. Other tech giants such as Alibaba Group, JD.com, Baidu, and BYD also experienced declines amid market worries over competitive pressures.

Impact on the Hang Seng Index

The Hang Seng Index felt the weight of the bearish sentiment, dropping by 1.5 percent to 17,087.42, the weakest since late October. The broad selloff has effectively nullified the index's gains from November and exacerbated the 15 percent decrease seen over the prior three months, highlighting concerns about China's tepid economic rebound.

Mainland Chinese investors seem to have retreated, with net sales of Hong Kong stocks through the Stock Connect reaching over HK$2.7 billion this week, continuing the trend from last week's net selling.

Other Market Movements

While Meituan and other tech stocks faced downward pressure, some companies like Alibaba Health managed to secure a rise, with a 2.4 percent increase following strategic corporate moves.

The debut of the CSOP Saudi Arabia ETF, a unique exchange-traded fund tracking top Middle Eastern firms, marked a significant occasion, witnessing gains on its initial trading day in Hong Kong.

Other key Asian markets presented a mixed view, with Japan and South Korea's indices showing marginal movement and Australia recording a slight increase.

Meituan, HangSeng, Slowdown