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Wall Street’s China-Concept Stocks Plunged across the Board

Well-known Chinese news site Tencent News recently reported that, with the SEC announcement of the regulatory details and the news of Didi’s delisting, on December 3rd, 243 of the over 280 China-concept stocks in the U.S. market fell. More than half them dropped by over five percent, 87 stocks dropped by over ten percent, and 33 stocks dropped by over fifteen percent. Some of the star China-concept stocks lost around 20 to 30 percent in value. Even large companies like Alibaba dropped by 8.23 percent. Since President Trump signed the Holding Foreign Companies Accountable Act into law in December, 2020, the Public Company Accounting Oversight Board (PCAOB) has been working closely with the SEC on implementation details of the law to ensure foreign companies entering the U.S. capital market will abide by U.S. auditing rules. Currently only China and Hong Kong have not allowed overseas securities regulatory agencies to conduct investigations directly, or to use evidence collection and other activities within the territory of China. The Chinese laws also forbid Chinese companies or individuals from providing documents and materials required by overseas auditors without prior authorization. The newly released U.S. regulatory details may directly lead the China-concept companies to delist from the U.S. stock market.

Source: Tencent News, December 4, 2021