Shares of Chinese stocks, including Nio Inc - ADR NIO and Alibaba Group Holding Ltd - ADR BABA, are both trading lower amid continued overall weakness in global markets on US Fed policy tightening concerns.
Chinese growth stocks tradable on US exchanges, including e-commerce and EV names, continue to sell off in anticipation of Fed policy tightening in 2022. The technology industry has also been pressured by a recent rise in Treasury yields, together with Fed tapering concerns.
The 10-year US Treasury yield is hovering around a two-year high at 1.785% Monday morning, which has pressured valuations. When interest rates rise, the value of future cash flows is reduced for growth stocks, which in turn lower the value of the stock.
Nio is trading lower by 11.8% at $24.12.
Alibaba is trading lower by 3.6% at $118.82.
© 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.