Leading Chinese tech stocks retreated Tuesday as the sector lost ground along with the broader market that felt the impact of another scorching hot U.S. inflation report.
Before the start of trading, the Consumer Price Index report for August was released, which showed a gain of 8.3% compared to the same month a year ago, and above expectations of a rate of 8.1%. The core CPI also rose 6.3% from a year ago, while expectations were for 6.1%.
All the major U.S. stock indexes dove into the red following the CPI report, with the Dow Industrials (DJI) down more than 1,200 points on the day, the Nasdaq Composite (COMP.IND) off by more than 5% and the S&P 500 (SP500) falling by more than 4%.
It was a case of guilt-by-association for Chinese tech stocks, as decliners ruled the day’s stock-trading activity.
Alibaba (NYSE:BABA) shares gave up more than 5%, Tencent Holdings (OTCPK:TCEHY) slipped by 3%, Baidu (BIDU) fell almost 6%, Weibo (WB) gave up more than 4%, Pinduoduo (PDD) fell more than 5%, JD.com (JD) shed more than 7% and Bilibili (BILI) ended the day down by more than 8%.
The KraneShares CSI China Internet ETF (KWEB) shed 4.6%.
NetEase (NASDAQ:NTES), which had been one of the few gainers earlier in the day, also dipped into the red. NetEase (NTES) had originally gotten a lift after the Chinese government gave its OK to one of the company’s mobile games this month. It was the first time a NetEase (NTES) got Chinese officials’ approval for a game since July 2021.