Chinese tech stocks suffer fresh hit as US drags Tencent, CATL into military sphere

Some of China’s biggest private technology companies took a fresh hit in the stock market after the US added Tencent Holdings and Contemporary Amperex Technology or CATL, to a list of Chinese military entities, heightening geopolitical tensions before Donald Trump takes office later this month.

Tencent, the operator of super-app WeChat, slumped 5.2 per cent to HK$388.20 in Hong Kong, tracking a 7.6 per cent slide in its American depositary shares in New York overnight. CATL, the world’s biggest maker of electric-vehicle batteries, sank 2.7 per cent to 249.72 yuan in Shenzhen.

The Hang Seng Index tumbled 1.7 per cent, dragging the benchmark gauge to the lowest level since November 26. Tencent and CATL called the move a mistake and misunderstanding.

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The register does not have the effect of a trade ban or sanction and companies can ask to be removed from the “blacklist”, although the move is likely to raise caution among investors. President-elect Donald Trump, who ordered a ban on American investments in such entities in 2020, will return to the White House on January 20.