Asia Pacific Stock Updates
Sign up for myFT Daily Digest to get to know Asia Pacific stock news first.
Global investors sold $ 2 billion in Chinese stocks on Monday as crackdowns on Beijing’s education companies raised concerns about tightening regulations across the world’s second-largest economy.
Through market collaboration in Hong Kong, investors have offloaded RMB 12.8 billion ($ 2 billion) worth of shares listed in Shanghai and Shenzhen, selling overseas at the fastest pace of the year.
Market turmoil was caused by a move by Beijing to ban tuition groups over the weekend From making a profit, Financing or going public. News of the measures revealed in the leaked memo and later confirmed wiped out about $ 16 billion from the three values of the sector’s largest companies on Friday.
Losses continued on Monday, with the Shanghai and Shenzhen-listed Chinese benchmark CSI 300 down 3.2%, while the education firm’s subindex fell more than 9%. In Hong Kong, the Chinese corporate index of mainland companies fell 4.2% and the broader Hang Seng Bank fell 3.5%. The Hang Seng Index fell 5.6%, the worst one-day fall in almost five months.
Investors have stated crackdowns following regulatory measures to curb financial and tech companies, including: Vehicle dispatch app Didi Chuxing E-commerce group Alibaba has expressed concern that no sector can circumvent tighter crackdowns.
Frank Benjimura, Head of Equity Strategy at Societe Generale, said:
Chinese After-school tutoring industry It has grown rapidly in recent years as middle-class parents seek benefits for their children on tests that determine admission to the country’s top universities. However, the overhaul outlined in the leaked document was aimed at “effectively” reducing student academic burdens and household spending on education within a year.
Hong Kong-listed stocks of one of the sector’s big names, New Oriental Education, plummeted by more than 40% on Monday, with stock losses of around 65% in two sessions.
Beijing has launched an ongoing crackdown on the fast-growing sector over the past year. In November, regulators unplugged a record $ 37 billion initial public offering of Ant Group, a fintech company managed by. Billionaire Jack Ma, right before.
After that Wider clamp down About technology groups that include antitrust investigations into Ant-affiliated Alibaba and other large e-commerce platforms. Immediately after Diddy’s New York IPO this month New rule An overseas management list has been introduced for Chinese companies whose data collection activities cover more than 1 million users.
Dicky Wong, head of research at Kingston Securities, a Hong Kong brokerage firm, said: “This will create fear and selling pressure in the short term.”
No Hedges — Markets, Finance, Strong Opinions
Robert Armstrong analyzes the most important market trends and explains how the best of Wall Street responds to them.sign up here Send newsletter directly to your inbox every week
Education crackdown sparks sharp sell-off for Chinese stocks Source link Education crackdown sparks sharp sell-off for Chinese stocks