Alec Hogg: Fresh Gupta-related heat on HSBC
Chinese regulators last night scrambled to contain the plunge in Hong Kong-based tech stocks, helping Tencent regain around a third of the past week's price plunge. The piece from the Financial Times provides detail of the secretive conference call with 12 of Wall Street's finest including BlackRock, Fidelity, Goldman Sachs and JP Morgan.
As a direct result, share prices rebounded in Hong Kong this morning. Leaving aside the obvious issue of insider trading, the real question is whether the call was sanctioned by the Chinese Communist Party's hierarchy – and if so, whether Beijing is willing or even able to reverse its escalating attack on internal capitalists. After reading in the WSJ this morning how an outspoken Chinese industrialist was yesterday sentenced to 18 years in jail for speaking up for farmers and rural businesses, I doubt it.
We sold China-related Naspers and Discovery out of the BizNews Share portfolio at this month's update on Tuesday, a decision with which I remain comfortable despite yesterday's bounce. The fundamentals have changed for investors in China. Not so for Spotify, which last night reported quarterly results. Mr Market focused on Spotify's slower growth in new users rather than a doubling in ad revenue – knocking the shares back 6%. A buying opportunity for long-term investors.
___STEADY_PAYWALL___