Shares in Chinese companies have plunged amid growing regulatory pressure. The Nasdaq Golden Dragon China index, which tracks Chinese firms listed in America, fell by 15% on Monday and Tuesday, the biggest two-day plunge since 2008. China’s benchmark CSI 300 index fell by 6.5% over the same period. Tech firms slumped, with Tencent’s shares in Hong Kong down by nearly 16% over Monday and Tuesday. The latest falls followed news of a ban on for-profit school tutoring, a big industry in Asia.
As of 5 May, there were 248 Chinese companies with listings in the US. Companies such as Alibaba and Pinduoduo have listings in America in order to access Western capital markets. There is now a “dark cloud hanging over” these stocks, writes Therese Poletti for MarketWatch. The next one in the firing line? The Chinese authorities have made their displeasure clear with ride-hailing app Didi, which recently listed in New York.
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