Tencent shares' US$35b loss shows depth of China gloom

Hong Kong

FOR a clue on how bearish foreign investors have become about Chinese stocks, take a look at Tencent Holdings Ltd.

The Shenzhen-based technology giant has tumbled 13 per cent from its September record, wiping US$35 billion off the value of its shares, as overseas funds pulled money from Hong Kong and Chinese equities. The company's large weighting on the Hang Seng Index - at 10 per cent - helped make Hong Kong's benchmark stock gauge one of the world's worst performers last quarter.

The company, which has more "buy" ratings than any other in Hong Kong, is a victim of fund redemption pressures, according to Asset Management One Singapore Pte. Investors pulled about US$409 million from exchange-traded funds (ETF) that buy Chinese and Hong Kong stocks in the week till Dec 21 as concern grew over a weakening yuan and tighter liqui…