Meituan (HK: 03690) shares have been hit by 6.5% over more general worries about the Chinese economy plus a dose of pessimism about competition. There's no corporation specific piece of news which really makes Meituan less attractive as a proposition, it's more general worries that seem to have coalesced around the stock.
Meituan reported results just before the weekend which were good - or at least better than the year previously: “Meituan posted a net profit of RMB 3.36 billion ($486 million) in the first quarter of 2023, compared to a loss of RMB 5.7 billion during the same period of 2022. Total revenue of the company amounted to RMB 58.62 billion, an increase of 26.7% year-on-year.” The corporate claim is: “"During the quarter, the company saw healthy growth in all of its businesses, thanks to a strong recovery in local consumption," said Wang Xing, CEO of Meituan.” That is, it's not so much the end of covid and lockdowns, but the way that the economy more generally is recovering from those that are driving events.
But, if that recovery is being driven by general economic conditions then that means that general economic conditions are the drivers of Meituan's share price. That's logical - so if people worry about the general economy then Meituan will suffer: “sentiment fluctuating between the lift provided by the tentative agreement to raise the US debt ceiling and worries about China's weak economic recovery.” And: “Chinese shares reverse the morning's gains, with sentiment dragged by the country's slower-than-expected and uneven recovery as well as investor disappointment over Beijing's limited stimulus measures.”
Meituan share price from Hong Kong Stock Exchange
That's just the way it works. If the claim is that “X” influences our share price then when “X” happens the share price will be influenced. The more specific worry over the Chinese economy is that the industrial production numbers are looking weak. Given that China has a much greater preponderance of manufacturing as a percentage of the economy than more developed nations this is taken as a much larger signal than it is in European or N American economies. And thus we complete the valuation circle - Meituan says general economic conditions were responsible for its rise back to profit, there are worries about those general economic conditions, Meituan shares fall.
It's not always true that stock markets are right but their prevailing logic is, well, it's logical.