(Adds comments, context, updates share prices)
HONG KONG, March 27 (Reuters) - Shares in Chinese internet and software companies tumbled on Thursday, tracking losses in U.S.-listed peers, after a weak debut by gaming firm King Digital Entertainment Plc highlighted investors' concerns that the sector was overpriced.
Shares in Tencent Holdings Ltd, China's biggest listed internet firm with a profitable mobile gaming business, fell more than 7 percent to their lowest in six weeks, while the Hang Seng Composite Index for Information Technology fell nearly 5 percent, its biggest drop in nearly two months.
Mobile gaming industry executives had hoped King's stock market debut would revive interest in their notoriously fickle industry. The stock, however, fell as much as 16 percent on its U.S. debut.
"The market right now is doing some selective buying and profit taking, like in the internet sector because they're bearish and some investors may think that it's a little bit too high," said Linus Yip, a Hong Kong-based strategist with First Shanghai Securities.
Some analysts also questioned the prudence of Tencent's recent purchases, which include a $500 million stake in South Korean mobile gaming firm CJ Games. The company has made acquisitions for $895 million in March alone.
"Tencent has been carrying out too many acquisitions for too high prices," said Eugene Law, business development director at securities house China Galaxy International.
Investors were also wary after the weak King debut, Law added.
King's IPO was the largest U.S. tech IPO since Twitter's market debut in November, and the second-worst performing after textbook rental and academic service company Chegg Inc, which plummeted 23 percent, according to Thomson Reuters data.
At 0505 GMT, Hong Kong-listed web game developer NetDragon Websoft was down 5.5 percent, while software company Kingsoft Corp Ltd had dropped 6.6 percent. Shares of online game developer Boyaa slid 8 percent, while software firm Sinosoft Tech fell nearly 12 percent.
U.S.-listed Chinese tech firms such as Sohu.Com Inc closed down 7.2 percent, while Sina Corp fell 3.7 percent. Qunar Cayman Islands Ltd was 7.7 percent lower.
The broader market Hang Seng Index eased 0.5 percent.
(Reporting by Clare Jim and Alice Woodhouse; Editing by Anne Marie Roantree and Miral Fahmy)