The shares of gaming brand Tencent dropped including other prominent Chinese video-game companies after Chinese state media branded online gaming as “Spiritual opium” and “electronic drugs”.
Tencent announced new access restrictions for children. As per dw report, Tencent would limit gaming time for children under 12 to just one hour a day and two hours a day during holidays and children will not be allowed to make in game purchases anymore.
Because of such situation, nervous investors were quick to sell shares which lead to a drop of about 10 per cent in shares in Tencent at one point, wiping almost $60 billion from its market capitalisation. However later the losses were moderated and it ended down at 6.1 per cent. As per Reuters, NetEase dropped more than 15 per cent before paring losses to end down at 7.77 per cent.
The strong headlined article has spooked the investors and they continued to reevaluate their holdings as they review the longer-term consequences of a crackdown on firms including – Jack Ma’s Ant Group, Alibaba Group, Meituan, Didi Global and so on. So far Tencent has dropped more than $110 billion or roughly 17per cent of its market value since the start of last week, when Beijing sharply amped up its campaign.