China First Capital Group plunged as much as 78% on Wednesday before trading was suspended — last week, ArtGo Holdings plummeted 98%
Beijing/Hong Kong — A third Hong Kong stock in less than a week lost most of its value in a sudden one-day plunge, underscoring concern that the $5.2-trillion market has become a breeding ground for wild volatility.
Virscend suspects its shares were sold by First Capital because of a margin call, but has not verified anything, said Chen Keyu, Virscend’s director of investor relations. First Capital said it couldn’t immediately comment. Last week, ArtGo Holdings slumped 98% after MSCI scrapped plans to add the stock to its benchmark indices, citing concerns about its investability. That same day, a Chinese furniture maker fell as much as 91% after a short-seller questioned the company’s accounting. First Capital owned a 1.6% stake in ArtGo as of July, according to an exchange filing.
The collapse in 2017 of a shadowy group of companies, dubbed the “Enigma Network” by local activist investor David Webb, is now part of the biggest investigation of market malfeasance in the city’s history.
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