Chinese smartphone maker Xiaomi and tech company Tencent lost ground on the Hong Kong Stock Exchange on Thursday despite better-than-expected profits from both companies. The technology companies were also under pressure on the other Asian exchanges after the strong exchange losses of American peers. Investors traded their tech shares for companies that are expected to benefit more from the recovery from the coronavirus crisis.

The Hang Seng index in Hong Kong recorded 0.2 percent in the min. Xiaomi dropped 4 percent. In the fourth quarter of 2020, the world’s third largest producer of smartphones recorded more profit than expected. The turnover was a bit disappointing. The company also warned of higher costs due to the global chip shortage, which now affects consumer electronics manufacturers alongside the automotive industry.

Tencent, in which the tech investor Prosus, quoted in Amsterdam, has a large stake, lost 2.7 percent. The Chinese tech group, known for the popular chat service WeChat, recorded significantly more revenue and profit in the last quarter of last year. However, investors are concerned that the Chinese government will restrict Tencent’s payment and lending activities. Peking already addressed its competitor Alibaba in this respect.

The US stock exchange watchdog SEC also announced that it would introduce rules that would remove foreign companies from Wall Street if they did not comply with US accounting rules. This could affect double-listed Chinese companies. The Chinese tech group Baidu and Webshop Alibaba, both listed in Hong Kong and New York, lost 8.5 and 3.8 percent.

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