Beijing’s regulatory crackdown on China’s biggest technology company Alibaba has triggered a widespread sell-off among the country’s internet giants, with around £150bn wiped off the four top companies since Christmas Eve.
Shares in Alibaba fell 8pc in Hong Kong on Monday, the second big drop in as many trading days after an equally-steep decline last Thursday, the prior trading session.
Internet company Tencent and meal delivery app Meituan fell almost 7pc and ecommerce giant JD.com was down over 2pc.
A pall has hung over China’s biggest technology companies since authorities announced a competition investigation into Alibaba last week, widely interpreted as a sign that Beijing is seeking to rein in internet giants that could concentrate economic power.
On Sunday regulators ordered Alibaba’s payments affiliate Ant Group to significantly scale back its operations, halting its expansion into multiple areas of finance in a further crackdown on the company.
Ant Group, 33pc owned by Alibaba, was forced to pull what would have been the world’s biggest initial public offering last month at regulators’ request. Ant’s flamboyant founder Jack Ma had criticised authorities for slowing innovation and Beijing had feared that the company’s expansion into financial products could threaten China’s state-backed banks.
Alibaba is under investigation for forcing merchants on its shopping website to sign exclusivity deals barring them from dealing with rivals. Its drop on Monday came despite it announcing that it would almost double a share buyback programme to $10bn (£7.4bn) over the next two years.
The crackdown poses an existential threat to the online empire built by Mr Ma, who founded Alibaba in 1999. He stepped down as its chairman last year but is still seen as the face of Alibaba and Ant Group, which runs the Alipay app. Alibaba shares have fallen by a third since Ant’s IPO was pulled.
Beijing unveiled new anti-monopoly proposals last month, which it said would protect competition and ensure fair choice. The extent of any future crackdown remains unclear, creating significant uncertainty for tech investors in China.