Chinese equities trading in New York fell for a fourth week, the longest stretch of declines since January, as data showed that a slowdown in the world’s second- largest economy is deepening.
The Bloomberg China-US Equity Index slid 2.9 percent in the five days, extending its slump for the past month to 11 percent. Travel-booking website Ctrip.com International Ltd. sank for a fourth week amid concern protests in Hong Kong will crimp revenue. Alibaba Group Holding Ltd., which completed a record $25 billion initial public offering in September, posted its second weekly drop after surging 38 percent on its first trading day.
Chinese companies traded in the U.S. and Hong Kong retreated as a September government index of service industries fell while a manufacturing gauge remained flat. To prevent a deepening housing slump from hampering growth, policy makers this week eased property restrictions for the first time since the global financial crisis. Pro-democracy protests in Hong Kong have fueled the city’s biggest stock-market selloff in eight months.
“China’s slowdown is certainly a concern to markets, especially as it’s a developing economy,” Timothy Ghriskey, chief investment officer at Bedford Hills, New York-based Solaris Asset Management LLC, said by phone. “The geopolitical issue in Hong Kong is a big overhang, that’s the real concern here.”
Alibaba climbed 1.2 percent to $88.10 as of 3:10 p.m. in New York, cutting its slump over the past five days to 2.6 percent. It retreated 3.7 percent the previous week. The Bloomberg U.S.-China gauge added 1.9 percent yesterday.
“Alibaba’s inexpensive valuation at IPO was a factor for weakness in the China Internet space,” Brendan Ahern, managing director at New York-based Krane Fund Advisors LLC, which oversees three Chinese exchange-traded funds, said by e-mail.
Alibaba’s IPO price of $68 was 26 times 12-month forward profit as of Sept. 18, compared with 29 for Baidu Inc., China’s largest online search engine, and a multiple of 30 for Hong Kong-listed Tencent Holdings Ltd., according to data compiled by Bloomberg.
Ctrip, China’s biggest online travel agency, slid 6.3 percent for the week to near a four-month low.
China’s tourism board stopped approving mainlanders’ group tours to Hong Kong from Oct. 1 as pro-democracy demonstrations spread in the city. Group tours account for 8 percent to 10 percent of Chinese visitors, said Joseph Tung, executive director of the Hong Kong Travel Industry Council.
Trina Solar Ltd., China’s biggest profitable panel maker, tumbled 16 percent this week, the most since June, after the Changzhou-based company sold $100 million of convertible notes and an additional 10 million American depositary shares.
The iShares China Large-Cap ETF, the largest Chinese exchange-traded fund in the U.S., climbed 1.8 percent yesterday to $38.13, trimming its weekly decline to 2.7 percent. The Hang Seng China Enterprises Index added 0.4 percent, paring a loss during the holiday-shortened week to 2.2 percent.
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