(Bloomberg) -- Tencent Holdings Ltd. shares found some respite Friday, bouncing off a key technical level after their worst start to a year since the company’s 2004 listing.
Tencent rebounded 2 percent at 9:20 a.m. in Hong Kong, following overnight gains in the U.S. as the latest bout of earnings buoyed sentiment in the technology sector. The stock on Thursday briefly dropped below its 200-day moving average for the first time since 2016, taking losses since a January peak to $114 billion.
The Nasdaq Composite Index finally rebounded following a five-day rout. Risk-averse traders had been dumping tech and Internet stocks worldwide for weeks, unwinding one of last year’s most profitable trades amid concern over lofty valuations. Increasing evidence of a slowing smartphone market had added fuel to the selloff, as did a reported U.S. investigation into China’s Huawei Technologies Co. following a ban on ZTE Corp.
Shenzhen-based Tencent, Asia’s biggest company by market value, has still tumbled 18 percent from its Jan. 23 high. The stock has been a favorite among investors and analysts alike -- it hasn’t had a single sell rating in more than two years. While breaching the 200-day moving average shows just how bearish sentiment turned on global tech, it doesn’t necessarily spell danger for Tencent, which more than doubled in 2017 after the last time it touched that level.
©2018 Bloomberg L.P.