Investors are reviewing their record holdings of mainland internet companies after Beijing proposed sweeping new antitrust rules for China’s technology industry, reported the Financial Times.
Leading groups including Tencent, Alibaba and Meituan-Dianping have attracted record investment during the Covid-19 pandemic, according to data from Copley Fund Research, which tracks the investment activities of more than 180 of the world’s largest funds, said the FT.
But Louise Dudley, a portfolio manager at Federated Hermes, said the combination of new regulations and a move by the Trump administration to prohibit American investors from investing in companies with suspected ties to the Chinese military, had heightened risk.
“It’s something we are definitely aware of, perhaps it is more of a risk now than it was a month ago,” she said. The shift in sentiment comes after Beijing unveiled new draft rules targeting online lending by non-banking groups that were partly to blame for scuppering the $37 billion initial public offering of Ant Group, the financial technology company.