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US-listed Chinese shares fall as home market teeters
[NEW YORK] US-listed Chinese equities fell on Tuesday as stock markets in China tumbled again and raised worries of broader financial problems in the world's number-two economy.
E-commerce giant Alibaba was the most heavily traded individual stock on the New York Stock Exchange, falling 0.8 per cent after earlier diving to an all-time low.
Internet search company Baidu lost 0.8 and online retailer JD.com fell 4.0 per cent. Small companies suffered significantly bigger drops: Qihoo 360 Technology (-7.1 per cent), social networking platform Renren (-7.0 per cent) and streaming video provider Youku Tudou (-6.7 per cent).
The losses came on the heels of a bursting bubble in Chinese stocks that have bled an estimated US$3.2 trillion in value since mid-June.
In an effort to stem further sell-off, Chinese officials on Sunday ordered a halt to initial public offerings and moved to pour funds into the market.
On Monday, the benchmark Shanghai Composite Index finished 2.41 per cent higher helped by the announcement of support, but then fell 1.29 per cent on Tuesday.
The Shenzhen Composite Index, which tracks stocks on China's second exchange, dropped 5.34 per cent Tuesday, and Hong Kong followed its 3.18 per cent plunge on Monday with another 1.03 per cent loss on Tuesday.
Peter Donisanu, global research analyst at Wells Fargo Investment Institute, said Chinese stocks could have further to fall.
"Right now what we're seeing in the sell-off comes down to a lack of confidence in the government's ability to prop up the markets like they did at the start of the year," he said.
The slide is the flipside of a rally earlier in 2015 that was "sentiment-based and speculative" and came despite a weakening economy.
"The Chinese economy has been slowing for quite some time," he said.
Mr Donisanu said Tuesday's drop in US-listed Chinese stocks was "more of a knee-jerk reaction" to try to get ahead of negative momentum and was not based on the fundamentals of the Chinese economy.