Tencent and NetEase shares plunged on Friday after Beijing released draft guidelines aimed at curbing incentives that could lead to excessive gaming and spending.
China’s National Press and Publication Administration released the new draft guidelines during the mid-morning Friday trade, sinking the Hong Kong-listed shares of the two Chinese companies.
Tencent tumbled as much as 15.7% to HK$263.60 before paring losses to trade down about 12.7% in mid-afternoon trade, still its lowest since end-November 2023.
NetEase sank by as much as 28% to HK$117.30, breaking briefly below a key technical support offered by a February low at around HK$120.70. In mid-afternoon trade, NetEase shares pared losses to trade down about 20% at HK$129.
This compares with the 1.2% loss on the Hang Seng Index and the 1.8% slide on the China Enterprises Index of the largest offshore mainland blue-chip names listed in Hong Kong.
Tencent and NetEase are two of the largest developers and operators of popular online games in the world’s largest online gaming market.
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Source: CNBC