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Chinese tech companies lost $ 60 billion in three days

I lost Giant tech companies in China The double-listed – Alibaba, Baidu, JD.com and Netease – collectively have billions of their market value in just a few days.

The losses come amid a possible threat to cancel the listing on US stock exchanges.

As of Friday’s close in Hong Kong, the market value of the shares of the four dual-listed tech companies had fallen by 468.64 billion Hong Kong dollars (about $ 60.31 billion) in three days.

Below is a list showing how much each of the US listed companies have lost in terms of market value.

Alibaba: It has lost 303.1 billion Hong Kong dollars (39 billion dollars).
Baidu: lost 107.54 billion Hong Kong dollars
JD.com: lost HK $ 30.674 billion
Netease: Has lost HK $ 27.334 billion

On Wednesday, the US Securities and Exchange Commission passed a law threatening to expel companies from US stock exchanges unless they adhere to US auditing standards.

The law, known as the Foreign Company Accountability Act, was passed by the administration of the former president (Donald Trump).

The law requires companies designated by the Securities and Exchange Commission to conduct an audit from a US watchdog and need to demonstrate that they are not owned or controlled by a government entity in a foreign jurisdiction.

The Securities and Exchange Commission said in a statement on Wednesday: that companies should also name any of the members of the board of directors of the Chinese Communist Party officials.

In addition to these regulatory uncertainties, Chinese technology companies also face potential challenges domestically as Beijing tightens its grip on the rapidly expanding sector and institutes antitrust laws in fintech and e-commerce.

Reuters reported earlier this week that the founder of Chinese technology company Tencent met with Chinese antitrust officials this month to discuss compliance in his group.

And in a crackdown last year, Ant Group’s IPO – which was billed as the largest in the world – was suddenly suspended a few days before its debut, with the indication that billionaire (Jack Ma) founder of Alibaba is the controller of Ant Group. .

Alongside these concerns, the technology sector as a whole globally has also come under pressure as bond yields have risen.

Higher returns hurt growth stocks because they reduce the relative value of future earnings.

The growth stock is a stock for a company that generates significant and sustainable positive cash flows that are expected to increase its revenue and profits at a faster rate than the average of other companies in the same industry.

Moreover, with growing optimism about a potential global economic recovery from the pandemic, investors may be looking to shift portfolios away from technology, and switch to other areas, such as equities, that gain as the economy recovers.

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