Alibaba, JD Fall In Hong Kong As Another Chinese Property Developer Defaults On Debt Payment, No End To Power Crisis In Sight

Shares of Alibaba Group Holding Limited BABA, JD.Com Inc. JD, Baidu Inc. BIDU, Xpeng Inc. XPEV, Li Auto Inc. LI and Tencent Holdings Inc. TCEHY are all trading lower in Hong Kong on Tuesday.

What’s Moving: Chinese e-commerce giant Alibaba’s shares traded more than 1% lower at HKD 135.60 in Hong Kong, while technology company Baidu’s shares are down more than 2% to HKD 142.90 and e-commerce company JD.com’s shares are down almost 0.4% to HKD 273.60.

Meanwhile, electric vehicle maker Xpeng’s shares have lost almost 1.5% to HKD 134.60 and peer Li Auto’s shares are down 1.4% to HKD 99.55.

See Also: How To Buy Xpeng Motors (XPEV) Stock

Tech conglomerate Tencent Holdings’ shares traded more than 1% lower at HKD 452.20.

Hong Kong’s benchmark Hang Seng Index opened lower on Tuesday but is up almost 0.3% at the time of writing as it attempts to stage a recovery following two consecutive days of losses. The index closed almost 2.2% lower on Monday.

Why Is It Moving? The Hang Seng Index opened lower as risk appetite waned amid worries about the outlook for China’s property sector. A power shortage in the world’s second-largest economy also continued to weigh on investor sentiment.

It was reported by Bloomberg that Chinese property developer Fantasia Holdings Group Co. Limited failed to repay a $205.7 million bond that was due Monday, sparking fears about widening default among heavily leveraged property developers.

Meanwhile, highly-indebted property developer China Evergrande Group EGRNF is seeking to raise more than $5 billion by selling a majority stake in its property management unit Evergrande Property Services Group Limited EVGPF, Reuters reported. Trading in shares of both companies was halted on Monday.

China needs to boost its coal supply to tide over the power crisis and avert a slowdown in the fourth quarter, but geopolitical tensions with coal exporters Australia are a roadblock, CNBC reported, citing investment bank Mizuho.

Shares of Chinese companies closed sharply lower in U.S. trading on Monday after the major averages in the U.S. ended deep in the red.

Alibaba’s shares closed 3.2% lower, while Nio’s shares ended down by 5.6%.

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