Chinese stocks traded in New York fell the most in a week, led by telecommunications operators, after Alibaba Group Holding Ltd. said it’s seeking to offer phone services.
The Bloomberg China-US Index of the most traded Chinese stocks in the U.S. dropped 1.5 percent to 103.94 yesterday. China Unicom (CHU:US), the nation’s second-biggest wireless carrier, retreated the most since October and China Mobile Ltd. (CHL:US), the biggest operator, slumped. China Petroleum and Chemical Corp., Asia’s largest refiner, fell to the lowest in six weeks as China raised gasoline standards.
China’s Ministry of Industry and Information Technology said in May that private companies could submit applications for a two-year trial ending in December 2015 to become mobile virtual network operators. Alibaba, China’s largest e-commerce operator, is applying for a license, according to Florence Shih, a spokeswoman for the company.
“This will definitely increase existing competition in the telecom sector,” Di Zhou, a Santa Fe, New Mexico-based equity analyst at Thornburg Investment Management, said by phone yesterday. “Internet companies like Alibaba and electronics retailers can attract more customers by packaging phone services with their current services and products.”
The iShares China Large-Cap ETF (FXI:US), the largest Chinese exchange-traded fund in the U.S., tumbled 2.3 percent to $37.59 in New York, the lowest close in a month. The Standard & Poor’s 500 Index slipped less than 0.1 percent as investors assessed data on home sales and jobless claims.
American depositary receipts of China Unicom dropped 2.7 percent to $15.01, the biggest decline in eight weeks. That extended this year’s retreat to 7.9 percent.
China Mobile slipped 1.4 percent to $51.85 and China Telecom Corp., the smallest of the three state-owned wireless carriers, slipped 1.1 percent to $49.70.
Licenses to resell wireless capacity to consumers may be issued as soon as this month, though the government hasn’t released a timeline or specified the rates carriers can charge to lease spectrum, according to the ministry.
China Petroleum (SNP:US), known as Sinopec, slumped 3.1 percent to a one-month low of $80.97, while PetroChina Co., the country’s biggest oil producer, retreated 1.6 percent to $109.56. Offshore crude explorer Cnooc Ltd. fell 1.7 percent to $183.30.
China will start implementing the “China V” standard for gasoline, an equivalent to the Euro V standard, as part of efforts to reduce vehicle emissions, the Xinhua News Agency reported yesterday, citing the Standardization Administration.
Muddy Waters Research LLC, founded by short-seller Carson Block, offered to pay for an accounting firm to evaluate an independent committee’s investigation into NQ Mobile Inc., according to a letter published yesterday. In an Oct. 24 report, Muddy Waters alleged that NQ Mobile, a Chinese Internet security company, inflated sales.
Beijing-based NQ denied the allegations and said last month its independent special committee retained the law firm Shearman & Sterling LLP to review Muddy Waters’s report.
Independent committees “are not effective ways of investigating possible wrongdoing in companies,” Carson Block, the founder of Muddy Waters, said in an interview with Bloomberg Television yesterday.
ADRs of NQ Mobile climbed 5.2 percent to $11.84, gaining the most this week. The ADRs are still 48 percent below their Oct. 23 level.
Vipshop Holdings Ltd. (VIPS:US), a Guangzhou-based online clothing retailer, jumped 6.7 percent to $80.69, rising the most since Nov. 12. LightInTheBox Holding Co., a web retailer of lifestyle goods based in Beijing, rallied 5.7 percent to $8.12 in New York, the highest in a month.
The Hang Seng China Enterprises Index in Hong Kong sank 1.7 percent to 10,777.91, the lowest level since Nov. 15. The Shanghai Composite Index slipped 1 percent to 2,127.79, dropping for an eighth day, the longest stretch of declines in six months.
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