Tencent loses US$140b of market value since Jan peak

SHANGHAI: If you thought the slump in United States technology stocks was bad, take a look at Tencent Holdings Ltd.

The firm has shed 25 per cent from its January peak, erasing about US$140 billion (RM568.71 billion) of market value.

That’s the biggest wipeout of shareholder wealth worldwide, as measured from the date of each stock’s 52-week high.

Facebook Inc is the secondbiggest loser with a US$136 billion slump over the past three trading sessions.

Investors are beginning to question whether the best days are over for technology stocks – the leaders of a nine-year boom in global equities.

Tencent, Asia’s second-largest company after e-commerce behemoth Alibaba Group Holding Ltd, has also been dogged by concern that growth in its mobilegaming unit is slowing.

The stock, down 2.7 per cent yesterday and 9.2 per cent in July, is poised for its biggest monthly retreat since 2014.

“Investors are increasingly pricing in lower expectations for Tencent’s interim results,” said Linus Yip, a strategist at First Shanghai Securities in Hong Kong.

“Overall, tech companies are facing a similar problem. They have been enjoying fast profit growth in the past few years, so it will be difficult for them to maintain similar growth in the future as the competition grows and some segments are saturated.”