Chinese tech stocks are extending losses on Tuesday in the pre-market session, seeing further erosion of their already-weakened valuations.
A few things are working in the minds of investors ahead of the market open in the United States. The cues from Hong Kong, which opened after Monday's public holiday, are not very encouraging. Alibaba Holdings, Inc. BABA shed over 4% in Hong Kong and Tencent Holdings Limited TCEHY ended 2.78% lower.
The weakness seen in premarket trading is attributable to regulatory risk that has continued to pressure these stocks since the start of 2021.
Chinese ride-hailing giant DiDi Global Inc. DIDI confirmed over the weekend that its shareholders would vote on a proposal for voluntarily delisting its shares from the U.S. exchange. The stock plunged close to 19% on Monday.
Additionally, China's Central Cyberspace Administration announced over the weekend that it is launching a two-month special action to clamp down on illegal content seen in the live broadcasting and short-video industries.
In premarket trading on Tuesday, Alibaba shares dropped 1.90% to $92.91.
Bilibili Inc BILI stock was down 2.23% at $22.82.
Baidu Inc. BIDU shares slipped 1.27% to $125.12.
JD.com Inc. JD pulled back 1.74% to $56.50.
Related Link: Is Charlie Munger's Patience Wearing Off? Daily Journal Cuts Alibaba Holdings By Half In Q1
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