Shares in Tencent Holdings fell 5.2 percent on February 21, the biggest drop since September.
Around 2pm, a user with the alias "Crazy Panda" posted on Snowball, an online finance community, that Tencent was about to be "crushed" by authorities and the share price quickly went south.
"Crazy Panda" deleted his account and all content soon after.
ZHANG Jun, PR head at Tencent said the allegation had "evolved into various versions, all false.”
Led by Tencent, The Hang Seng index fell 0.7 percent to 24,170.07, while the China Enterprises Index lost 1 percent, to 8,455.99 points.
