The shares of Chinese companies listed in the U.S., commonly known as “Chinese stocks”, are in big shock! Foreign media reports, Goldman Sachs on Friday, acting as a block trade in the United States to sell shares worth up to 10.5 billion U.S. dollars (about 81.9 billion Hong Kong dollars), including the mainland search engine Baidu Group (09888), helmed by Robin Li, scandals continue, and led to a number of shares from Chinese technology to the United States media companies market value evaporated 35 billion U.S. dollars in a single day. Baidu on Friday in the U.S. closing market although inverted, but after the city extended trading hours put pressure continued, equivalent to about 199.8 Hong Kong dollars, compared with the Hong Kong stock market closing last Friday, about 7% lower, in other words, today’s share price in Hong Kong fear of losing 200 Hong Kong dollars.
Reportedly, Goldman Sachs in the United States last Friday before the market opened, sold $6.6 billion worth of Baidu, Tencent Music (TME) and Vipshop, and then sold $3.9 billion worth of U.S. media companies ViacomCBS, Discovery, Farfetch, Baidu’s Aiki, and with who learns. Sources said Morgan Stanley also sold on behalf of one or more shareholders, with individual companies being sold with shares worth more than $1 billion.
These transactions have led to share price volatility and a sharp increase in trading in the shares involved, as the market speculates on the identity of the mystery seller and worries that the wave of selling may not be over, especially since the SEC just announced the Foreign Controlled Companies Liability Act, which puts pressure on Chinese stocks to exit the market.
Among them, Baidu on Friday in the U.S. share price once dipped 14.9% to a low of $ 174.05, after gradually recovering lost ground, closing slightly up 1.97%, but after the market fell 1.74% to $ 204.97, equivalent to the price per share in Hong Kong about 199.84 Hong Kong dollars, meaning that last week in Hong Kong after the listing of the stock price “see bear “Baidu, may face further selling pressure. As for other shares involved, Akiyon closed in the U.S. on Friday plunged 13.2%, with who learns more plunged 41.5%, ViacomCBS and Discovery fell 27.3% and 27.4%, respectively, Tencent Music also closed 1.2% lower.
While block trades are commonplace and sometimes negotiated off-exchange, the size of sub-block trades and the practice of launching them in batches during normal trading hours is rare. Traders are surprised by this, but also whether there are hedge funds or Family investment office “trouble”, and therefore need to be forced to sell goods speculation. Archegos took a long position in Viacom, Discovery, Baidu, Tencent Music and other related stocks, and used high leverage, but after Viacom announced a stock placement on March 23, the stock price plummeted.
It was alleged that the fund was chased by an investment bank to collect the deposit, and the shares held by the bank were liquidated because it could not fulfill the result. Just as Viacom shares plummeted, the fund’s holdings in Chinese stocks received bad news, such that Baidu, Tencent Music, Aiki and Vipshop started to fall, triggering a chain of chopped positions.
Nevertheless, U.S. stocks closed higher on Friday, with the Dow up 453 points at 33,072, a new closing high with the S&P. U.S. President Joe Biden plans to announce an infrastructure investment plan this week, the U.S. stock market closed on Friday for the holiday, but the latest employment data out that day is still worth watching.
In the market, the “King of Crocodiles” Dalio warned that the U.S. stock bubble has not yet reached the level of 2000 and 1929, but may have been halfway, so from the value point of view, I believe that compared to other assets, stock market returns will shrink.
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