China’s intensifying regulatory crackdown crushed tech stocks for a second day on Tuesday.
The Hang Seng HSI, -4.22% dropped 4.2% after falling 4.1% on Monday, in what’s been the steepest fall for the index since the coronavirus pandemic hit global markets in March 2020. The selling in Hong Kong accelerated toward the end of trading.
China’s multi-pronged attack on its high-flying companies extended to Meituan 3690, -17.66%, which fell 18% after new rules were issued requiring online food platforms to ensure their drivers are paid at least the minimum wage.
China’s technology giants continued to reel, with Tencent Holdings 700, -8.98% losing 9% and Alibaba Group 9988, -6.35% BABA, -7.15% losing 8%. Alibaba Health Information Technology 241, -18.52% dropped 19%.
The late dive for the Hang Seng pressured U.S. stock market futures ES00, -0.46%, which turned negative. Futures on the Nikkei 225 NIY00, -0.91% also turned lower after a positive close for the Japanese market NIK, +0.49%.
“A sense of caution is likely to linger across markets as investors adopt a guarded approach due to the Asian volatility and Federal Reserve policy meeting on Wednesday,” said Lukman Otunuga, senior research analyst at FXTM.
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