Of the ten companies in the world that lost the most market value in July, nine are Chinese. The reason is investors ’concerns about how President Xi Jinping’s grip on the tremendous amount of technological waste is tightening.
China’s the government’s tighter grip on the country’s major technology companies has led to a sharp decline in their share prices and market values.
According to the news agency Bloomberg alone, 23 percent of the value of the Internet giant Tencent had left in July, or 143 billion euros.
It was the largest drop in the market value of a single company in the world in July, Bloomberg declined.
For comparison, the total value of all index companies on the Helsinki Stock Exchange was close to EUR 345 billion at noon on Thursday.
World list of the ten companies that lost the most market value in July speaks harsh language to the Secretary-General and President of the Chinese Communist Party Xi Jinpingin the impact of new economic policies led by China on the stock prices of China’s largest technology companies.
Bloombergin statistics as many as nine out of ten of these companies are Chinese.
That tenth, the only non-Chinese company, was the Dutch investment company Prosus.
Prosus is a subsidiary of Tencent’s main owner, Naspers of South Africa.
Among the companies that have lost the most value are waste such as the marketplace company Alibaba and online stores Meituan and Pinduoduo, which for various reasons have been the fault of the Chinese administration or subject to various distortions of competition.
Almost 88 billion euros worth of Alibaba had left by July, 74 billion euros from Meituan and 50 billion euros worth of Pinduoduo.
Specially companies that have applied to western capital markets and stock exchanges have become familiar with the new policies of the Chinese government, one of the purposes of which is to prevent Chinese data from falling into American hands.
For example, China’s largest rider Didi Global, Internet giant Baidu, Meituan and Alibaba Group Holding, which are listed in the United States, are all registered their own postal address companies in the Cayman Islandsto make it easier for them to adapt to the daily lives of Western investors.
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In China the importance of President Xi’s new policies was realized more quickly than in Western countries, according to stock transactions.
In July, Chinese investors made a mass exodus of holding shares in large technology companies such as Tencent and Meituan.
Bloombergin published on Wednesday statement According to, mainland Chinese investors divested Tencent shares on a net basis in July for HK $ 33 billion, or € 3.6 billion.
The share of mainland Chinese in Tencent is now at its lowest level since February, statistics say.
At Meituan, the corresponding net sales of Chinese shares in July were Hong Kong dollars 13 billion, or 1.4 billion euros. At the same time, local ownership of the company fell to its lowest level since May.
Thursday the prices of technology companies were on the rise.
This was due, on the one hand, to the general rise in Chinese stock prices and, on the other hand, the Chinese government’s efforts in recent days to allay concerns that private companies focusing on education and digital learning environments, for example, have recently been specifically targeted.
Bloombergin by there have been numerous articles in the state-run media in recent days that such concerns are exaggerated.
China had sought to allay concerns about itthat private learning environment companies would be subject to special discipline by the Chinese government.
According to Bloomberg, the state-run media had published several articles that considered the resulting market panic and exchange rate reactions to be excesses.
Indeed, Tencent’s share price rose 10 percent in China on Thursday.
The change in mood was also well reflected in the price of the Miniso retail chain, which is also listed in the United States, rising by more than 17 percent.
China’s the government’s stranglehold on large technology companies began to tighten last fall as Alibaba’s founder and billionaire Jack Ma went to a direct presentation on the old-fashioned nature of the Chinese banking system in a presentation on Saturday.
The following Monday, the Chinese authorities announced that they were investigating the terms of the listing of Ant Group, a payment company spun off from Alibaba, and the giant share issue had to be canceled.
Read more: Billionaire Jack Ma mocked Chinese banks, and soon after he disappeared – the reason is that the Man company was a threat to the Chinese banking system
Alibaba was then caught by the competition authorities and fined heavily.
Read more: E-commerce company Alibaba thanks the Chinese authorities for the billions in fines: “We would not have grown without reasonable control”
Jack Ma disappeared from public view for a long time, until Jack Mata “nearby parties” said he would focus on improving his golf shots on a holiday island.
Ride service Didi barely had time to list on the U.S. stock exchange in a $ 4.4 billion share issue at the turn of June-July, when authorities demanded it for a security check on July 2 and demanded app stores to remove apps from their selections.
The message was clear.
International enlargement had to be done within the limits set by the Chinese Communist Party.
Later in July, the Chinese government announced new regulations on the teaching activity and publicly stated that “teaching is kidnapped by capital”.
In China, a popular food online store was hit by the administration, among other things, by demanding that platform food stores must guarantee their employees an adequate minimum wage.
European Union trying to curb technological waste with various digital economy legislation packages currently underway. Also the president of the United States Joe Biden the administration has been actively attacking the largest technology companies on the basis of various competition law inquiries.
All of these have the same goal – to avoid concentrating too much power and data on a few super companies in order for the economy to function fairly and efficiently.
In China, new models are only simpler to implement than in Western states, because decisions are ultimately made by one person – Xi Jinping.