China tech stocks rise after Meituan hit with antitrust fine
GUANGZHOU, China — Meituan shares surged over 7% on Monday, main China expertise shares increased, after the meals supply big was slapped with a high quality because of an antitrust probe.
On Friday, China’s State Administration for Market Regulation (SAMR) said Meituan abused its dominant position within the nation’s on-line meals supply market. The market regulator mentioned Meituan pushed retailers to signal unique cooperation agreements with them and carried out punitive measures for those who did not.
The SAMR slapped a 3.44 billion yuan ($534.3 million) high quality on Meituan and ordered it to hold out rectification measures, concluding a months-long probe.
In a notice on Sunday, funding financial institution Jefferies mentioned the high quality has eliminated an “overhang” on Meituan.
“We consider the SAMR choice addresses market considerations and Meituan (MT) has been speaking with authorities and upgrading its enterprise operations,” Jefferies mentioned.
Meituan was up greater than 7% in early Hong Kong commerce.
The high quality equated to three% of Meituan’s 2020 income.
In a separate anti-monopoly probe, Alibaba was slapped with a $2.8 billion high quality — about 4% of 2019 revenue the e-commerce giant was forced to pay as part of an anti-monopoly investigation in April.
Different Hong Kong-listed Chinese language tech firms additionally rose in early commerce. Tencent was increased by 3% whereas Alibaba jumped greater than 6%.
“General the truth that Chinese language fairness markets are undoubtedly … buying and selling rather more enticing relative to most different nations right here in Asia,” Ken Wong, Asia fairness portfolio specialist at Eastspring Investments, instructed CNBC’s “Avenue Indicators Asia” on Monday.
“Chinese language markets … are buying and selling at considerably decrease valuation ranges,” he mentioned. “We’re seeing buyers backside fishing a bit.”
Wong mentioned that any constructive sentiment popping out of China towards the expertise sector ought to result in “extra shopping for” of the associated shares.
China has been growing scrutiny on its home expertise firms over the previous 12 months, wiping billions of dollars of value off tech stocks.
Regulators have targeted on tightening rules around unfair competition and data protection however have even gone additional than different jurisdictions by turning their consideration to regulating algorithms.