The US dollar strengthened against the offshore yuan, climbing 0.9 per cent to trade at 6.733 per dollar. The US Dollar Index, which measures the greenback against a basket of major currencies, gained 0.3 per cent. Gold retreated 1.1 per cent to US$1,893.73 per ounce.

Alibaba, which owns a third of Ant Group and this newspaper, slumped 7.5 per cent to HK$277.20 for its steepest loss since its local debut a year ago. Its American depositary shares tumbled 8.1 per cent in New York overnight.

“We think there’s no impact on opening capital market to foreign investors, but foreign investors should bear in mind there are plenty of regulatory risks in China as the regulations are evolving to catch up with the rapidly-growing fintech business,” Iris Tan, senior equity analyst at Morningstar, said in a report to clients. “The regulator is aiming to level the playing field for both fintech players and traditional financial institutions in the market.”

The operator of Alipay online payments system was set to raise up to US$39.67 billion proceeds in the world’s biggest-ever stock offering amid strong demand. The sale drew US$3 trillion of bids from retail investors in Shanghai and Hong Kong. Several brokerages have agreed to refund investors and waive interest on margin financing.

01:17

Hong Kong residents closely watching results of 2020 US elections

Hong Kong residents closely watching results of 2020 US elections

Earlier results of the US presidential election showing that the outcome will be closer than polls had suggested. Joe Biden won 220 electoral votes and Donald Trump secured 213 in the race to 270, according to CNN’s running tally. Polls indicated that Biden was ahead of his rival, though the race looked tight in some battleground states. Trump later said he would turn to the Supreme Court to seek an early end to vote counting.

That appears to have rattled traders in mainland China and Hong Kong. Semiconductor companies and firms related to telecom giant Huawei Technologies Co. Technologies – targeted with sanctions by Trump – took a noticeably heavier blow after local lunch break.

Semiconductor Manufacturing International Corp, China’s largest chip maker, tumbled 6.5 per cent in Hong Kong and 2.4 per cent in Shanghai trading. Ingenic Semiconductor, a Beijing-based peer, retreated 3.6 per cent in Shenzhen. Sunny Optical, which supplies lenses for Huawei Technologies phones, was 2.8 per cent lower. Shenzhen TXD Technology, an important Huawei partner, slipped 3 per cent at 30.94 yuan.

Losses on Ant-related stocks were tempered by gains on carmaker Geely Automobile, casino operator Galaxy Entertainment and the city’s top lender HSBC. Old-economy stocks would benefit from the switch, as investors turn to safer bets, said Louis Tse Ming-kwong, managing director of Wealthy Securities.

“There’s quite a bit of caution in the market because of the deferment of Ant Group’s listing,” he said. “It’s a lesson for the market, to remind investors, sponsors and accountants that [companies’] earnings are huge, but have they been properly and legally [compliant]?”

Xiaomi Corp, which competes with home rival Huawei in the global smartphone market, surged 17.9 per cent to a two-month high of HK$23.95. Investors bet the company will profit from Huawei’s misery if Trump is re-elected. Food delivery giant Meituan jumped 6 per cent to HK$313.80.

Wisesoft, a software maker whose Chinese name sounds like “Trump’s smart win” jumped 6.4 per cent, repeating the same gain in November 2016 when the businessman defeated Hilary Clinton. It prompted the software maker in southwestern Sichuan province to call for “rational investment” in response to local media queries.

Banks, insurers and property developers advanced broadly. HSBC added 2.1 per cent to HK$34.50, and Henderson Land gained 2 per cent to HK$28.70.

Chinese carmakers advanced broadly, with electric vehicle producers receiving a boost from a State Council document released on Tuesday night that outlines the EV sector‘s development through 2035. China aims to grow new EV sales to make up 20 per cent of all car sales by 2025, and to make EV the “mainstream” of new car sales by 2035, according to the plan.

BYD, one of the largest EV makers in China, rose 2.4 per cent to an all-time high of HK$168.03. The stock has skyrocketed by 253 per cent this year.

Elsewhere, major markets in Japan and South Korea were mostly upbeat, save for Australia. The gains followed a rally in US stocks in overnight trading, which was spurred by expectations that Congress will roll out a spending bill once the presidential election is over. With risk-on sentiment, the US longer-dated Treasuries dropped and oil futures extended gains on anticipation of fresh stimulus packages.

Additional reporting by Daniel Ren