The Hang Seng index nosedived on Tuesday after China pledged to tighten its rules on unfair internet competition. The rules were published by the State Administration for Market Regulation (SAMR). The HSI index declined by more than 1%, with most companies being in the red. Other Asian indices like the Nikkei 225 and Shanghai Composite also declined.
Tech stocks lead Hong Kong stocks lower
The Hang Seng index has been left behind this year. While its peer indices in the United States and Europe have surged, the index has declined by more than 6% year-to-date. This performance is mostly because of China’s battle with its technology companies.
This war continued today when SAMR announced a new draft as it sought to stop unfair competition in the tech sector. The companies will now need to face more rules such as not providing false data like the number of clicks. Also, operators should not conceal negative reviews as they promote positive ones. Also, the rules bared operators from using data and algorithms to collect and analyze competitors trading information.
Therefore, the Hang Seng index declined sharply today. The worst performers were WuXi Biologics, ANTA Sports, Haidilao, Tencent, Alibaba, and HKEX. These firms shares declined by more than 4%. The best performers today were companies like Sunny Optical, AIA Group, China Unicom, and China Resources Land.