If you’re ever upset about an off-day in the stock market, consider the alternative: an off-month. 🤢 That’s what happened to Chinese stocks in July.
The broad sell-off began with $DIDI’s failed IPO last month, but the losses really started compounding in the last few days. Chinese and Hong Kong stocks have lost over $1.5T in market value since Tuesday. 😬
The Chinese Communist Party has launched a public campaign designed to curtail China’s Big Tech companies—think Jack Ma and Ant Financial, but like, every single tech company. The country is supposedly concerned about conflicts of interest that come with listing overseas, as well as data security.
Among the greatest losers are China’s mega tech leaders: Tencent, Alibaba, Meituan, and Pinduoduo. These four players lost astronomical amounts of market cap in July.
But that’s not all. China is making it clear that no business is safe. The company banned private tutoring companies from making a profit, crushing most education stocks.
This is likely just the beginning of an enormous/ongoing change to both policy and capitalism in China.