HK Stock Market Move | TENCENT (00700) falls more than 2%, plans to launch a reconsideration process to correct the error made by the US Department of Defense, investing 1.5 billion Hong Kong dollars in share buybacks.

TENCENT (00700) fell more than 2% again, plunging over 7% yesterday. As of the time of writing, it dropped 2.48% to HK$370.2, with a trading volume of HK$16.504 billion. On the news front, on the evening of January 7, TENCENT officially announced that the US Department of Defense mistakenly listed the company as a Chinese military enterprise and will initiate a review process and take necessary measures. According to documents from the Hong Kong Stock Exchange, TENCENT's major shareholder, Prosus, reduced its stake in TENCENT from 24.01% to 23.99% on January 6, selling about 367,000 shares for a total of about HK$150 million. In addition, on January 7, TENCENT spent HK$1.501 billion to repurchase 3.93 million shares at a price range of HK$376.8-392.4 per share. Citigroup pointed out that investors are usually more sensitive, so TENCENT's stock price may be affected in the short term, but the overall growth prospects and business fundamentals remain unchanged. The bank said it understands the market's panic reaction, but also believes that being listed does not necessarily mean there is enough evidence to support the decision. The bank believes that TENCENT will work with the US Department of Defense to address any misunderstandings and notes that several companies successfully removed from the list last year after providing effective explanations.