Chinese Online Education and Entertainment Stocks Drop, Oil Up
TAL Education Group (NYSE: TAL). joins Luckin Coffee Inc. (Nasdaq: LK) in a week of scandals for Chinese U.S. listed companies.
Zai Lab Ltd. (Nasdaq: ZLAB) gained 7% to $55.11 per share on Wednesday. The company Wednesday announced a strategic collaboration with Regeneron Pharmaceuticals, Inc. for the development and commercialization of REGN1979 in mainland China, Hong Kong, Taiwan and Macau.
China SXT Pharmaceuticals, Inc. (Nasdaq: SXTC) jumped 5%. The company engages in the research, development, manufacture, marketing, and sale of traditional Chinese medicine piece tablets in China.
ECMOHO Ltd. (Nasdaq: MOHO) rebounded after a 16% loss on Tuesday. The Shanghai-based company operates as an integrated solution provider in the non-medical health and wellness market.
Shares in another biopharma giant China Biologic Products Holdings, Inc. (Nasdaq: CBPO) soared 7% to $106.70 per share .The company offers human plasma-based biopharmaceutical products to hospitals and inoculation centers in China.
BeiGene, Ltd. (Nasdaq: BGNE) gained 3% to $140.40 per share. The Beijing-based company provides molecularly-targeted and immuno-oncology drugs for the treatment of cancer in China.
Crude oil futures jumped over 10% to $26.14 per barrel, which helped both oil stocks as well as some Chinese new energy companies. Solar energy company Daqo New Energy Corp. (NYSE: DQ) gained 6%, Canadian Solar Inc. (Nasdaq: CSIQ) up 4% and ReneSola Ltd. (NYSE: SOL) rose 5%.
Chinese education companies declined after an uptick on Tuesday, as TAL uncovered financial fraud by a "certain employee."
One of China's largest education providers said in a statement that the employee overstated the sales at TAL's Light Class segment and forged contracts and other documentation. v
GSX Techedu Inc. (NYSE: GSX) lost 6%.The Beijing-based company offers online K-12 after-school tutoring services in China.
LAIX Inc. (NYSE: LAIX) lost 9% to $3.01 per share. The Shanghai-headquartered company provides online English learning services through its Liulishuo mobile app.
Youdao, Inc. (NYSE: DAO), which also offers online learning services, lost 7%, closing at $18.89 per share.
Shares in iQiyi slid to as low as $15.71 per share, then rebounded, closing at $16.51 per share, down 5%. California-based activist research firm Muddy Waters Research and New York-based short seller Wolfpack Research LLC posted a short report on Tuesday via Twitter, which claimed that iQiyi inflated its revenues in 2019 by 27% to 44%.
The stock price of its controlling shareholder Baidu Inc. (Nasdaq: BIDU) dropped 4% along with it.
JOYY Inc. (YY) lost 4% to $57.29 per share, while shares in DouYu International Holdings Ltd. (Nasdaq: DOYU) dropped 4% to $7 per share. Both are leading games and entertainment live streaming platform in China.
U.S. stocks rose Wednesday. The Dow Jones Industrial Average added 780 points to 23,434, or 3.44%. The S&P 500 gained 91 points or 3.41% to 2,750, and The Nasdaq Composite rose 2.58% to 8091.
Despite the HK$138 billion ($18 billion) COVID-19 relief package Hong Kong announced on Wednesday, the Hang Seng Index in Hong Kong dropped 1.17% by 283 points to 23,970.
The Shanghai Composite declined 0.19% to 2,815 and The Shenzhen Composite slid 0.41% to 10,387.