Hong Kong stocks took the lead in declines across the Asia-Pacific region, with Alibaba’s shares observing a substantial dive in early trading. The Hang Seng index in Hong Kong fell by 2.12% in the final hour of trading, and the tech-focused Hang Seng Tech index dropped 1.7%, largely influenced by the heavyweight Alibaba, which experienced a close to 10% decline.
Despite this, the Hang Seng index was on track to conclude the week with gains of about 1.5%.
Alibaba’s decline was attributed to the company’s announcement that it would not proceed with the full spinoff of its cloud group due to U.S. chip export restrictions.
The news added a layer of complexity to an already volatile market, impacting investor sentiment.
Investors in the region also grappled with the outcome of high-level discussions between the United States and China. Furthermore, economic data in the region played a crucial role in shaping market sentiments throughout the day.
Wall Street experienced a breather from the rally seen earlier in the month. In Japan, the Nikkei 225 closed 0.48% higher, while the Topix added 0.95%, recording weekly gains of 2.33%.
South Korea’s Kospi ended 0.74% lower, while the Kosdaq fell 1.50%. Australia’s S&P/ASX 200 closed 0.13% lower but registered a 1% rise for the week.
Mainland China’s CSI 300 index was the only major market in Asia that registered a weekly fall, closing down by about 0.6%.
Overnight in the U.S., the Dow Jones Industrial Average closed lower, breaking a four-day run of gains, slipping by 0.13%. The S&P 500 ticked higher by 0.12%, and the Nasdaq Composite inched up by 0.07%.
As markets recalibrate and react to global economic events, the impact of Alibaba’s significant decline on Hong Kong stocks underlines the connection of international financial markets and the influence of geopolitical factors on investor confidence.
