Stock movements on an electronic screen in New York, USA
On Friday Goldman Sachs Group Inc. liquidated $ 10.5 billion worth of shares in blockchain operations on Friday, as part of an extraordinary sell-off that wiped out $ 35 billion of bellwether stock values, ranging from Chinese tech giants to US media conglomerates.
The Wall Street bank sold shares in Baidu Inc., Tencent Music Entertainment Group and Vipshop Holdings Ltd. worth $ 6.6 billion before opening the market in the US, according to an email to customers seen by Bloomberg News.
This move was followed by the sale of $ 3.9 billion worth of shares of ViacomCBS Inc., Discovery Inc., Farfetch Ltd., iQiyi Inc. and GSX Techedu Inc., according to the email.
According to people familiar with the matter, Morgan Stanley would say that more of the unregistered share offerings were managed on behalf of one or more undisclosed shareholders. Some of the businesses exceeded $ 1 billion in individual companies, according to estimates Bloomberg data show.
Goldman Sachs spokeswoman Maeve DuVally declined to comment. A spokesman for Morgan Stanley declined to comment.
Price fluctuations
The liquidation caused price fluctuations for each share involved in high-volume transactions, while provoking some of its industry counterparts. It also stimulated speculation among some traders about the forced sale by a fund in the liquidation phase.
Several major investment banks linked to the hedge fund Tiger Cub Archegos Capital Management LLC liquidated the holdings, contributing to the fall in the prices of shares of ViacomCBS and Discovery, IPO Edge reported, citing people he did not identify.
In block operations, large volumes of securities are privately traded between the parties, usually outside the open market.
Friday’s sale dragged down companies like Alibaba Group Holding Ltd. and NetEase Inc. Colleagues recovered later after traders said bids eased fears that wider trade would develop across the sector.
That late rebound boosted an index of companies engaged in Internet-related businesses in China and the United States, with the measure halting the three-day liquidation while still lowering the slide by about 6.5% during the week.
Chinese stocks have been under pressure after a warning from the Securities and Exchange Commission that it is taking steps to force accounting firms to let U.S. regulators review the financial audits of overseas companies; the penalty for non-compliance is expulsion from the stock exchanges. In addition, Bloomberg News reported that the Chinese government has proposed forming a joint venture with local technology giants that would oversee the lucrative data they collect.
Read more: ViacomCBS, Discovery Plunge on New Downgrade, Block Trades