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“Good Days Have Gone”: A Shocked Wall Street Responds To China’s Unprecedented Crackdown On Tech Giants

Following reports that Beijing was looking to scapegoat regulators responsible for initially permitting the ill-fated Ant Group IPO, which was scuttled by the CCP leadership back in October after Alibaba founder and Ant Group Chairman Jack Ma criticized Chinese tech regulation, saying it was “stifling innovation”, at an obscure industry conference, it appears China’s anti-trust regulators are imposing new restrictions on the financial arms of other Chinese tech giants after hobbling Ant.

As Beijing reportedly prepares to slap Tencent with an antitrust fine commensurate with the $2.8 billion recently demanded from Alibaba, news that Chinese regulators had summoned 13 internet companies and ordered them to rectify their digital financial businesses dealt another blow to market sentiment. The wide-ranging restrictions could weigh on credit growth and hurt the prospects of public share offerings by fintech firms, analysts have warned.

The HS Tech index which includes many Chinese tech firms is down 23% from the February peak as Beijing has vowed to step up scrutiny on monopoly practices in the industry and ordered overhaul of Alibaba’s Ant Group. Meituan, which was the subject of its own antitrust crackdown earlier this week, saw shares fall as much as 3.6%, while Tencent dropped 1.2%. The two companies were the biggest drags on the MSCI Asia Pacific Index.

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