U.S.-Listed Chinese Companies' Shares Drop as Exports Decline

U.S.-listed shares of Chinese companies experienced a downward trend during Tuesday's premarket trading session. This drop came as data revealed a sharp decline in exports during July, indicating a potential slowdown in global economic growth.

China's export figures for July were lower than expected due to weakened global demand, and this decline was also reflected in vehicle sales within the country. While retail sales of passenger cars slipped by more than 2% in July, retail sales of new-energy cars saw a positive increase of nearly 32%.

Impact on Chinese Internet Stocks

The premarket activity on Tuesday showed a decrease in American depositary receipts for Chinese internet stocks. Huya Inc., iQiyi Inc., Bilibili Inc., JD.com Inc., Baidu Inc., and Alibaba Group Holding Ltd. experienced declines of 5.4%, 4.2%, 4.0%, 3.5%, 3.0%, and 2.8% respectively.

Additionally, the KraneShares CSI China Internet ETF saw a decrease of 2.7%.

Examination of Chinese Economy and e-Commerce Impact

Investors eagerly await Alibaba's announcement of its June-quarter results, which will shed more light on the state of the Chinese economy and its influence on e-commerce. In a late July note to clients, a Truist Securities analyst expressed optimism, expecting the results to demonstrate significant improvement in China's online commerce and service sector amidst a recovering macroeconomic environment.

Decline of Chinese Electric Vehicle Companies' Shares

Chinese electric vehicle companies also experienced a decline in premarket trading on Tuesday, despite Li Auto Inc. reporting positive financials for its latest quarter.

Li Auto's American depositary receipts saw a decrease of 5.6% in premarket action, while Nio Inc.'s shares were down 4.5% and XPeng Inc.'s shares declined by 4.3%.

These developments suggest a cautious sentiment among investors regarding the performance of Chinese companies in the current economic landscape.