Home Capital Investing Strategies

China ADR game over with onset of 'super bear' market

Wong Kok Hoi
Wong Kok Hoi3/15/2022 5:5 PM GMT+08  • 10 min read
China ADR game over with onset of 'super bear' market
Right now, we believe the China ADR game is over
Font Resizer
Share to WhatsappShare to FacebookShare to LinkedInMore Share
Scroll to top
Follow us on Facebook and join our Telegram channel for the latest updates.

Something freakish took place in China ADRs last week. Almost every once-beloved American Depositary Receipt seemed to be infected with a panic-selling “virus”.

Over just two days, Alibaba Group Holding’s stock price dropped 14%, Meituan -20%, JD.com -23%, PinDuoDuo (PDD) -26%, and Didi Global -50%. The indiscriminate selling was not limited to just a handful of stocks, as the KraneShares CSI China Internet ETF — which tracks the CSI Overseas China Internet Index — dropped 19% over two days.

This bizarre behaviour of the sellers had not been seen in the past. There wasn’t any earth-shattering event last week that could be pinned down to explain the frenzied panic selling. The most common explanation we heard from market participants was the US Securities and Exchange Commission singling out five ADRs for failing to submit their auditor notes.

For more insights on corporate trends...
Sign In or Create an account to access our premium content.
Subscription Entitlements:
Less than $9 per month
Unlimited access to latest and premium articles
3 Simultaneous logins across all devices
Bonus unlimited access to online articles and virtual newspaper on The Edge Malaysia (single login)
Loading next article...
The Edge Singapore
Download The Edge Singapore App
Google playApple store play
Keep updated
Follow our social media
Subscribe to The Edge Singapore
Get credible investing ideas from our in-depth stock analysis, interviews with key executives, corporate movements coverage and their impact on the market.
© 2022 The Edge Publishing Pte Ltd. All rights reserved.
Unlock unlimited access to premium articles with less than $9 per month. Subscribe Now