By Gina Lee
Investing.com – Weibo Corp (HK:9898) shares fell as they debuted on the Hong Kong Stock Exchange on Tuesday, with investor caution amid China’s regulatory crackdown on the internet sector set to continue.
Shares were trading at HK$254.2 ($32.6) by 10:58 PM ET (3:58 AM GMT) after falling as low as HK$253.6 earlier in the session. However, the Chinese social media giant raised $385 million through the offering.
Goldman Sachs Group Inc., Credit Suisse Group AG, Citic Securities Co. and China International Capital Corp. were joint sponsors.
Despite Weibo’s weak debut comes, global technology shares are enjoying a recent rebound as China pledged to increase economic support as the economy continues its recovery from COVID-19. Receding fears that the new omicron COVID-19 variant will impact the global economic recovery also boosted investor sentiment.
Weibo's U.S. shares (NASDAQ:WB) were up 4.69% to $33.48 at the end of Tuesday’s session, halting a four-day fall.
Weibo’s Hong Kong debut compares with a 15% average gain on the first session for 52 Chinese companies that started trading in the city in 2021 after raising more than $100 million each, according to Bloomberg data.
“China’s internet sector will continue to be weighed by regulatory uncertainty in 2022 after the rapid and broad-reaching moves by authorities in 2021 across a wide spectrum of companies,” Bloomberg Intelligence analyst Matthew Kanterman said in a note.
“The increased threat of delisting of U.S. shares by both U.S. and Chinese regulators as well as the broader regulatory overhang may keep valuations depressed,” the note added.
Launched by Sina (NASDAQ:SINA) Corp. in 2009, Weibo quickly gained millions of registered users who post messages of 140 characters or less. The Twitter Inc (NYSE:TWTR).-liked company was listed on the Nasdaq board in 2014.