Beijing's Regulatory Crackdown Wipes $1.1 trln off Chinese Big Tech

The Chinese national flag is seen in Beijing, China. Credit: Reuters File Photo
The Chinese national flag is seen in Beijing, China. Credit: Reuters File Photo
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Beijing's Regulatory Crackdown Wipes $1.1 trln off Chinese Big Tech

The Chinese national flag is seen in Beijing, China. Credit: Reuters File Photo
The Chinese national flag is seen in Beijing, China. Credit: Reuters File Photo

China's major tech companies have shed more than $1 trillion in value -equivalent to the entire Dutch economy - since the government's regulatory crackdown on the sector began more than two years ago, according to Refinitiv data.
Investors are now hoping the strict rules that have stymied growth since late 2020 will start to ease, after the People's Bank of China (PBOC) indicated a change in direction could be under way.
The central bank said on Friday most of the main problems for platform companies' financial businesses had been rectified, and regulators would shift their focus to the industry as a whole rather than specific companies.
The state planner on Wednesday praised Tencent Holdings, the world's largest video game company, and e-commerce titan Alibaba Group, for their contributions to China's tech innovation, in another sign that authorities are warming to the technology sector once more.
Analysts pinpoint the shelving of Alibaba affiliate Ant Group's $37 billion initial public offering (IPO) in November 2020 as the start of a sweeping regulatory crackdown on mainland China's tech firms, which had grown rapidly in size and influence.
Since then, roughly $1.1 trillion has been wiped from the market capitalisation of the Hong Kong-listed stock of Alibaba Group, Tencent, Chinese food delivery giant Meituan , search engine provider Baidu Inc and e-commerce site JD.com.
Share prices for the five companies have plunged between 40.4% and 71% during that time.
Technology stocks in Hong Kong have rallied 4.1% since Monday as investors bank on an easing regulatory environment to boost earnings, but some analysts have sounded a note of caution.
"Mega-cap tech companies will allocate increasingly large amounts of capital expenditure towards developing generative AI technologies and products in a hostile external environment, potentially impacting profitability," said Redmond Wong, Saxo Markets strategist in Hong Kong.
Steven Leung, UOB Kay Hian sales director, said current valuations would last "until we see more supporting policies from authorities".



Ford Recalls More than 200,000 Vehicles over Malfunctioning Rearview Camera

A Ford automobile logo is seen during the New York International Auto Show Press Preview in New York City, US, April 16, 2025. REUTERS/Shannon Stapleton/File Photo
A Ford automobile logo is seen during the New York International Auto Show Press Preview in New York City, US, April 16, 2025. REUTERS/Shannon Stapleton/File Photo
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Ford Recalls More than 200,000 Vehicles over Malfunctioning Rearview Camera

A Ford automobile logo is seen during the New York International Auto Show Press Preview in New York City, US, April 16, 2025. REUTERS/Shannon Stapleton/File Photo
A Ford automobile logo is seen during the New York International Auto Show Press Preview in New York City, US, April 16, 2025. REUTERS/Shannon Stapleton/File Photo

Ford Motor Co. is recalling more than 200,000 vehicles because a software defect can cause the rearview camera to fail, increasing the risk of a crash and injury, Reuters reported.

Ford told US highway safety regulators that the camera can either display a blank image or that the image may remain on the display after the driver finishes backing up, causing a distraction, Reuters reported.

Dealerships will eventually update the camera software free of charge.

Owner notification letters are expected to be mailed by July 28.