CRO concepts suffered a significant decline in the morning trading, as the US is considering tightening investment restrictions, and institutions warn of the short-term impact on risk sentiment.

CRO concepts suffered a significant decline in the morning trading, as of the time of writing, Wuxi AppTec (02359) fell 9% to HK$63.7; Pharmatech (01521) fell 6.99% to HK$1.33; Konruns (03759) fell 5.83% to HK$18.1; Yunding Tech (03347) fell 5.7% to HK$36.4.

On the news front, on February 21, the White House website released the "America First" investment policy memorandum, announcing that it will adjust the US investment policy and focus on further restricting bilateral investment with China. East China Securities pointed out that in the short term, this policy will directly impact the risk sentiment of Chinese technology stocks; in the medium term, it will focus on the specific measures that may be adopted by the Committee on Foreign Investment in the United States (CFIUS) in the future, as well as whether the tariff negotiations between China and the United States will target this policy and the subsequent risk of tariff escalation.

It is worth noting that Wuxi AppTec earlier announced that it would sell assets related to its Irish vaccine facility to Merck, with a total consideration of about US$500mn (about HK$3.9bn). Citigroup released a research report saying that although Wuxi AppTec's disposal of specified overseas facilities is in line with market expectations, some may view the asset sale as a defensive action against potential geopolitical risks. The bank believes that the Irish vaccine facility transaction will not have a negative financial impact on the Company and will improve its overall profitability.