This page has been archived and commenting is disabled.
Massive Volume "Panic Selling" Cuts Warren Buffett's Chinese Car Maker BYD In Half Overnight
For the second time in 2 days, a Chinese car maker's stock has been utterly devastated overnight - on absolutely no news. Shares in BYD - the Chinese electric car maker part-owned by Warren Buffett - crashed 47% in a bout of total panic selling (before recovering modestly), just a day after Geely - another car maker - crashed 22% on an earnings warning. The reason - perhaps unsurprising - given by some is worries over Mainland China IPOs "caused a liquidity squeeze," as the recent rally in mainland shares is led by leverage financing leading to major margin-calls on modest drops. Is it any wonder the PBOC is trying to tamp down the speculation.
Shares in BYD, the Chinese electric car company part-owned by Warren Buffett, fell as much as 47 per cent during a bout of panic selling.
BYD’s Hong Kong-traded shares rebounded partially in late trading to close down 29 per cent, at HK$25.05, on Thursday. Trading volumes were very heavy, at 40 times the previous day’s 15-day moving average, according to Bloomberg data.
In a statement issued after the market closed, the company’s board said it was not aware of any reason for the sharp sell-off.
BYD is the second Chinese car company to be punished by investors in as many days. On Wednesday shares in Geely, whose parent also owns Volvo Cars of Sweden, fell as much as 22 per cent after it flagged a possible 50 per cent year-on-year decline in net income for 2014.
“The mainland IPOs have caused a liquidity squeeze,” said Wang Weijun, a strategist at Zheshang Securities Co. in Shanghai.
...
BYD tumbled 29 percent in Hong Kong, the biggest loss on record since its listing in 2002. The shares slid 10 percent in Shenzhen. Investors are speculating on BYD’s outlook after Geely Automobile Holdings forecast a plunge in profits on the slumping ruble, said Mari Oshidari, a Hong Kong-based strategist at Okasan Securities Group Inc.
“There are a lot of rumors flying around in the market but there’s nothing concrete at the moment,” she said. “It’s hard to pinpoint what’s causing the sharp decline in the afternoon.”
The company’s “production and operations are operating as usual, this is market behavior, and the company is closely monitoring this,” Edward Zhou, a spokesman for the Shenzhen, China-based company, wrote in an e-mail seeking comment on today’s share-price decline.
...
The recent rally in mainland shares is led by leverage financing, potentially triggering regulatory scrutiny, Judy Zhang, an analyst at BNP, wrote in a research note. The Shanghai Composite may drop to 2,600 if the market deleverages by 1 trillion yuan, according to the report.
Investors bought 105.7 billion yuan of shares using margin debt on the Shanghai exchange yesterday, taking the outstanding value of stock purchases through borrowed money to 648.4 billion yuan, according to data from the bourse.
* * *
This is what happens Larry...
»
- 8498 reads
- Printer-friendly version
- Send to friend
- advertisements -
If it hurts Warren Buffet I'm ecstatic.
somethings justice finds its way through the miasma of modern-day economics.
The co makes electric cars. That is just enough reason for the stock to crash.
Did Uncle Warren drink the Koolaid too?
I thought he would have known better.
Gotta be careful about snorting fairy dust and drinking unicorn pee cocktails....
Pee? It would hav sounded better if you said piss.
get ready for the crying when Tesla gets monkey hammered one day.......watta joke
You mean Musk is a fraud? Damn right he is.
Nothing more free money for withered oligarchs wont fix.
Why? The man gave us Barack Hussein Obama almost single handedly.
Buffett took a bath. He loves bathing.
http://hedgeaccordingly.com/2014/12/banks-prepare-for-liquidity-coverage...
I'd like to throw an electric ANYTHING into a bathtub with WB & BQ in it.
Drop Blankfein in there with em and i'm for it
Paging Chuck Munger.....please report to the pool.
<what I said b4>
BTFD BYD
Its a good thing we aren't at record margin levels... what was that you said? ... ah...
It may be that a very similar game as is presently being played with petrol/energy sector and foreign sovereign debt.
Warrants Buffet and the like actually probably shorted BVD at this juncture with the intention to smash the price down in order to buy it up cheap when the muppets who had been very obviously and foolishly levering themselves received their margin calls. Pump and dump and grab.
"Pump and dump and grab"
Wasn't that one of those German Scheisse Movies that Kartmans mom was in?
More like shake and take
I bet you his Secretary never lost this much money in one day.
The stock folds just like the cars.
When China sneezes, America catches a cold.
On both a literal and figurative level, for sure.
Does this mean Canada doesn't have to catch a cold every time the US sneezes? That would be a relief....its been a bummer , given the US doesn't cover itself when it sneezes.
Warrwen Buffet and Barry are buddies. Buffet and Munger deserve it. Tough it out Munger.
I think you mean "Suck it up, Charlie!"
Fuck that corporate and government parasite!
Sideways with a rusty chainsaw & glass shards.
So... is this gonna require a bigger lever? Or fulcrum?
Lord, that's terrible. Just terrible.
Someone call the Treasury and have them cut grandpa a check.
THe sme thing could be getting ready to happen here if the Fed induced Santa Claus rally fizzles out...
http://www.globaldeflationnews.com/the-fedral-reserve-adds-patience-to-i...
Some losers desperate need cash to pay off their losses.
I'm reasonably confident that Warren didn't lose any money, and indeed, profitted handsomely.
KNDI peaked out at 22...now at 11 six months later.
Putin's speach was really bad. Bottom line is the world is going to be flooded with shit to get every dollar out there.
I suspect North Korean hackers or Anonymous or AQ
The FBI will confirm shortly
You don't have to pitty Buffett, he bought the stock, NASDAQOTH:BYDDY for $2 per share. Now it's at $8. But ofcourse that's not in the article.
Buffet must be buying like crazy.
between BYD and my PM holdings.....WINNING!
not
i should just drive a Silver Chinese electric car. Only i
cant catch a bid.....kaboom
now i just bought the Mrs a small condo on the Gulf Coast of FL...expecting any storms? BP? Can't say Mr. A.L. didn't warn you
This story is a big fucking DUH...
Who needs BYD, or electric cars in general, when oil is trending mercilessly toward zero?
Long big fucking gas-guzzling Cadillacs, bitchez...