Asia Tech Wire (May 23) -- Shares of NetEase Inc. (9999.HK) fell more than 6% after Morgan Stanley downgraded its rating on the Chinese tech firm.

NetEase's losses extended further in the afternoon on Thursday, as its Hong Kong-listed shares have fallen more than 6% to HK$143.60 apiece.

This is also the third consecutive day of decline for the Chinese game publisher's stock, hitting a new low since April 23rd.

NetEase is about to report earnings results for the first quarter of 2024 today. Market expectations indicate the company achieved revenue of 26.786 billion yuan in the quarter, an increase of 6.95% year-over-year.

Morgan Stanley previously issued a report, cutting its rating on NetEase's American Depositary Receipts (ADRs) to "equal-weight" from "overweight" and lowered its price target to $100 from $120.

The bank said that emerging risks from macroeconomic weakness, increased competition and potential regulation could reduce NetEase's potential for return on invested capital (ROIC) for existing and future games.

It said it had removed NetEase from its list of top picks in April in light of seeing a number of risks emerge.