(Bloomberg) — If last year was bad, 2022 is turning out to be even worse for holders of Chinese technology stocks. Still, there are no dip buyers in sight.

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A tech-heavy index of U.S.-listed Chinese stocks has fallen 41% in just 2 1/2 months — almost equaling the 2021 rout. Since its peak last year, the once red-hot benchmark has fallen by a record 75%, erasing $1.1 trillion in market value as Beijing’s close ties to Russia, regulatory headwinds and a zero tolerance Covid-19 policy sent investors fleeing.

The selloff has been so extreme that the Nasdaq Golden Dragon Index, which includes stocks like Alibaba Group Holding Ltd. and Baidu Inc., now trades at a rare discount to the S&P 500 Index, reversing its valuation premium of almost 100% from June.

E-commerce giant Alibaba now trades at a record low valuation of 9 times forward earnings — one of the cheapest high-growth plays in the U.S.

“Despite the better valuations that we see, we’re not buying China yet,” said Joost Van Leenders, senior investment strategist at Kempen Capital Management. “We still see too much uncertainty to even start drafting a proposal to buy them.”

The Hang Seng Tech Index of Hong Kong-listed stocks sank 8.1% Tuesday, bringing its decline over the past three sessions to 22%. That’s the biggest three-day drop ever for the index, based on data going back to 2015.

Tech Chart of the Day

The Nasdaq 100 Index on Monday closed in bear-market territory for the first time since March 2020 — and analysts’ price targets are the most bullish they’ve been since the same date. The targets imply a 36% rise for the shares in aggregate over the next year — the biggest forecast gain since the peak of the pandemic.

Story continues

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(Updates prices throughout.)

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