China stocks slump as Huawei shakes sen­ti­ment

Mint ST - - MARK TO MARKET -

A gauge of Chi­nese stocks in Hong Kong posted its big­gest two-day drop in 10 months as the ar­rest of Huawei Tech­nolo­gies Co. Ltd’s chief fi­nan­cial of­fi­cer (CFO) dealt frag­ile in­vestor sen­ti­ment an­other blow and deep­ened un­cer­tainty over China’s re­la­tions with the US. The Hang Seng China En­ter­prises In­dex dropped 2.6%, while the Shang­hai Com­pos­ite In­dex fell 1.7%. Tech­nol­ogy stocks were among the hard­est hit in both mar­kets as Huawei sup­pli­ers tum­bled. Huawei CFO Wanzhou Meng is fac­ing ex­tra­di­tion to the US after her ar­rest in Van­cou­ver in con­nec­tion with po­ten­tial vi­o­la­tions by the com­pany of US sanc­tions on Iran, ac­cord­ing to Canada’s depart­ment of jus­tice.

Drug­mak­ers tum­bled amid con­cern over price cuts, while the yuan fell for a sec­ond day. Chi­nese drug stocks fell the most since 2009 as in­vestors wor­ried the gov­ern­ment is driv­ing down prices for their prod­ucts via a cen­tral­ized pro­cure­ment pro­gramme. The MSCI China Health Care In­dex plunged 8.4%. BLOOMBERG

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