Guangzhou, China — Meituan After an antitrust investigation fined a food delivery giant, Monday’s share price surged more than 7%, surpassing China’s tech stocks.
On Friday, China’s National Immigration Administration (SAMR) said Meituan abused its dominant position In the country’s online food delivery market. Market regulators said Meituan urged merchants to sign exclusive cooperation agreements with them and took punitive measures against those who did not.
SAMR fined Meituan 3.44 billion yuan ($ 534.3 million), ordered corrective action to be taken, and completed a month-long investigation.
In a note on Sunday, investment bank Jeffreys said the fine had removed Meituan’s “overhang.”
“We believe SAMR’s decision addresses market concerns, and Meituan (MT) is in contact with authorities to improve operations,” Jeffreys said.
Meituan rose more than 7% in early Hong Kong trade.
The fine is equivalent to 3% of Meituan’s 2020 revenue.
With another antitrust probe, Alibaba was slapped with a $ 2.8 billion fine — about As part of an April antitrust investigation, e-commerce giants were forced to pay 4% of 2019 revenue..
East Spring Investments’ Asian Equity Portfolio Specialist Ken Wong told CNBC’s “Street Sign Asia” on Monday that “China’s stock market is undoubtedly … far more than most other countries in Asia. The fact that we have an attractive deal. “
“The Chinese market … is trading at a fairly low rating level,” he said. “Investors are seeing a bit of bottom fishing,” he said.
Wong said China’s positive sentiment towards the tech sector should “buy more” on related stocks.
China has increased its scrutiny of domestic tech companies over the past year. Wipe out billions of dollars in tech stocks..
China’s tech stocks rise after Meituan is fined for antitrust violations
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