Sector Snap: Chinese Web stocks mostly dip

Shares of Hong Kong-based software, gaming and Internet service provider CDC Corp. declined 10 cents, or 3.3 percent, to $2.92.

However, CDC Software said Wednesday that it has been awarded three multimillion-dollar sales contracts, including one to provide information technology services, products and support to an Australia-based sports entity.

Meanwhile, American Depositary shares of Beijing-based online gaming company Netease.com Inc. fell 53 cents to $21.47.

In a client note, Citi Investment Research analyst Alicia Yap said Netease's redesign and recent relaunch via a closed "beta" test of its first 3-D online game, "Tianxia 2," is an "important milestone" but she thinks it may take some time for the game to meaningfully contribute to the company's revenue.

ADS of Shanghai-based competitor Shanda Interactive Entertainment Ltd. declined 72 cents to $28.34. Elsewhere in the sector, ADS of Shanghai-based online travel company Ctrip.com International Ltd. rose 16 cents to $50.

Citi analyst Catherine Leung said in a note to investors that while the total impact to Ctrip of the May 12 earthquake in Sichuan province is still uncertain she is "encouraged" by recent checks that imply "a gradual recovery in travel sentiment in June."

She said the most negative impact appears to have been felt in the two to three weeks after the quake, but said it "remains to be seen whether travel sentiment, and subsequent actual travel, has returned to normal."

She expects the upcoming Beijing Olympics to have a "mixed" impact on the company, saying Ctrip could benefit in the short term from higher commissions due to increased hotel room rates, and in the long term from increased inbound travel. Still, the company could also see its normal business disrupted during the third quarter, she said.

ADS of Ctrip competitor eLong Inc., which is based in Beijing, fell 17 cents to $7.68.