The MSCI China Index is on track for a bear market, dropping as much as 2.1% Thursday to bring its decline from its October 2 high to 20%. Alibaba Group Holding Ltd. and Tencent Holdings Ltd. were the biggest drags on the day, while the Hang Seng China Enterprises Index fell almost 3%. The selloff in Internet and e-commerce stocks deepens on dim earnings prospects and sluggish domestic demand, with China's retail spending contracting in May for the first time since the pandemic. The index remains dominated by Internet and consumer companies listed in Hong Kong, missing out on the global AI-fueled rally that has pushed markets like Taiwan and South Korea to record highs. The Hang Seng China Enterprises Index is the second-worst performer among more than 90 indexes tracked by Bloomberg globally, and the Hang Seng Tech Index tumbled into a bear market earlier this year.
Tencent Holdings LtdDim earnings prospects and sluggish domestic demand, with China's retail spending contracting in May, hurt Tencent's revenue outlook.
Alibaba Group Holding LtdDim earnings prospects and sluggish domestic demand, with China's retail spending contracting in May, hurt Alibaba's revenue outlook.