Chinese suspension of Didi app weighs on APAC markets

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 Chinese suspension of Didi app weighs on APAC markets
Image source: A stock market ticker shows financial gains and losses. © Embe2006 | Megapixl.com

The equity markets in Asia Pacific (APAC) region started the week on a mixed note as investors eagerly awaited the outcome of the OPEC+ meeting. The markets in APAC were also hit after China suspended Softbank-backed Didi app from play stores alleging that it illegally collected users’ personal data.


This mixed sentiment in APAC markets stood in contrast to global sentiments – which were buoyed after the US reported better-than-expected employment data on Friday.

Tech shares in Hong Kong were battered after the Didi app was suspended from the app stores. Tech shares in Asia were mostly lower. The Hang Seng TECH Index shed 3.22% in the morning as shares of the tech companies listed in the Hong Kong tanked. Tencent Holdings Ltd shares fell 3.92% while Alibaba Group Holding Ltd dropped 2.36% and Meituan slipped 5.46%.

The broader Hang Seng Index was down 56 basis points.

“The app can no longer be downloaded in China, although existing users who had previously downloaded and installed the app on their phones prior to the takedown may continue using it,” Didi said in a statement, reacting to the suspension.

In Japan also, the shares of SoftBank Group Corp crashed by 5.12% due to the impact of the ban. As a result, Nikkei 225 was trading 55 basis points down. On the other hand, the Topix was relatively doing better, just 28 basis points down.

                         

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In the Mainland China, stocks edged higher as the Shanghai Composite Index was trading 16 basis points higher, while the Shenzhen Component was trading near the flatline, up 2 basis points.

The Caixin/Markit services Purchasing Managers’ Index for June, that was released Monday, clocked 50.3 — a visible decline from May’s reading of 55.1.

In Australia, the ASX200 was up 12 basis points, despite the Australian Bureau of Statistics (ABS), reporting a jump of 40 basis points in the retail sales. However, the lockdown in New South Wales, owing to a spike in COVID-19 cases, limited the gains on Australian shares.

Meanwhile, the OPEC countries and their allies are set to meet again on Monday as all the members except the United Arab Emirates (UAE) seem to have agreed to an easing of cuts and their extension to the end of next year, according to the meeting. The outcome will largely determine the sentiments in markets.

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