New Delhi: Elder sister Global Inc plunged into premarket trading when a Chinese regulator ordered the company’s platform to be removed from the App Store, days after a $4.4 billion initial public offering in the US.
Shares of the China-based tech firm fell 30% to $10.90, taking them below its $14 IPO price. They traded at $11.90 as of 4:19 a.m. in New York, after China’s Cyberspace Administration citing security risks and tightening its grip on sensitive online data. Didi, whose US depository receipts have traded only in New York since June 30, said the move could have an “adverse effect” on its revenues in China.
Chief market strategist Michael O’Rourke said, “The Chinese government’s strategy has the dual objective of keeping its corporate leaders in control, while also ensuring that investors primarily suffer more in the US than in China. ” Jones Trading.
According to people familiar with the matter, Chinese regulators asked Didi to delay its historic US IPO three months ago because of national security concerns involving a huge pool of data.
Uber Technologies Inc., the second largest Didi holder, fell 2% in premarket trading. The US stock market was closed on Monday for a holiday.
Full Truck Alliance Co and Kanjhun Ltd.Both recently went public in the US, falling 16% and 12%, respectively, after China expanded its scrutiny on the technology industry to include both firms. Beijing ordered him and Didi to stop registering new users.
While Didi’s half-billion existing users will still be able to order rides, China’s cybersecurity actions add to the uncertainty surrounding all of the country’s internet companies. Tencent Holdings Limited, which has a stake in Didi, is down 2.7% so far this week, after falling 3.6% on Monday and partially paring losses on Tuesday. After the closure of the market in Asia, the round of government announcements started on Friday.
The number of companies based in China vying for a New York IPO rose for the third consecutive quarter, while weakness in other US-listed stocks that do most of their business in China comes amid widespread antitrust investigations into the country’s Internet firms. The Nasdaq Golden Dragon China Index is down nearly 8% for the year, trailing the 14% gain in the Nasdaq Composite Index.
Kimberly Forrest, Bokeh’s founder and chief investment officer, said, “I’ve had a lot of discussions with clients who were attracted to Chinese stocks because of the price gains and they see the promise of investing in a coup that will boost its economy. increasing.” Capital Partners. “But I’ve always noticed a lack of accountability culture with respect to accounting that keeps me from buying these stocks.”
Shares of the China-based tech firm fell 30% to $10.90, taking them below its $14 IPO price. They traded at $11.90 as of 4:19 a.m. in New York, after China’s Cyberspace Administration citing security risks and tightening its grip on sensitive online data. Didi, whose US depository receipts have traded only in New York since June 30, said the move could have an “adverse effect” on its revenues in China.
Chief market strategist Michael O’Rourke said, “The Chinese government’s strategy has the dual objective of keeping its corporate leaders in control, while also ensuring that investors primarily suffer more in the US than in China. ” Jones Trading.
According to people familiar with the matter, Chinese regulators asked Didi to delay its historic US IPO three months ago because of national security concerns involving a huge pool of data.
Uber Technologies Inc., the second largest Didi holder, fell 2% in premarket trading. The US stock market was closed on Monday for a holiday.
Full Truck Alliance Co and Kanjhun Ltd.Both recently went public in the US, falling 16% and 12%, respectively, after China expanded its scrutiny on the technology industry to include both firms. Beijing ordered him and Didi to stop registering new users.
While Didi’s half-billion existing users will still be able to order rides, China’s cybersecurity actions add to the uncertainty surrounding all of the country’s internet companies. Tencent Holdings Limited, which has a stake in Didi, is down 2.7% so far this week, after falling 3.6% on Monday and partially paring losses on Tuesday. After the closure of the market in Asia, the round of government announcements started on Friday.
The number of companies based in China vying for a New York IPO rose for the third consecutive quarter, while weakness in other US-listed stocks that do most of their business in China comes amid widespread antitrust investigations into the country’s Internet firms. The Nasdaq Golden Dragon China Index is down nearly 8% for the year, trailing the 14% gain in the Nasdaq Composite Index.
Kimberly Forrest, Bokeh’s founder and chief investment officer, said, “I’ve had a lot of discussions with clients who were attracted to Chinese stocks because of the price gains and they see the promise of investing in a coup that will boost its economy. increasing.” Capital Partners. “But I’ve always noticed a lack of accountability culture with respect to accounting that keeps me from buying these stocks.”
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