Tencent's shares drop more than 5% in Hong Kong following U.S. classification as a military company.

The US Department of Defense added Chinese tech giant to its list of "Chinese military companies," causing a 5.4% drop in its shares in Hong Kong.

On Wall Street, Tencent's U.S. depository receipts experienced a near 8% decline in value.

Other Chinese companies added to the list included a battery maker, which is part of the supply chain for automakers such as Tesla and Volkswagen.

In Shenzhen, CATL shares experienced a decline of 3.5% before falling as much as 5.6%.

The National Defense Authorization Act of 2024 prohibits the DoD from procuring goods or services directly from entities on the list in June 2026, and indirectly from June 2027.

Tencent stated that its inclusion on the list was a "mistake."

The company clarified that it is not a military supplier and that the listing has no impact on its business, unlike sanctions or export controls.

CATL denied being involved in any military-related activities, calling the designation "a mistake."

— This is breaking news. Please check back for updates.