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U.S.-listed shares of Chinese internet stocks fell Tuesday after reports indicated that the Chinese government was planning to pass a new privacy law that would impact how companies collect user data.
Shares of Alibaba
BABA,
were down 4.7% in Tuesday trading and on track for their lowest close since Oct. 24, 2019. If the losses hold through the close, it would mark the first time that Alibaba shares closed below their pandemic low of $176.34 from March 23, 2020, according to Dow Jones Market Data.
Other Chinese tech names were falling as well, including Qutoutiao Inc.
QTT,
off 5.9%; JD.com Inc.
JD,
off 3.3%; Baidu Inc.
BIDU,
down 3.2%; iQiyi Inc.
IQ,
down 2.8%; and Bilibili Inc.
BILI,
off 2.6%. Shares of Tencent Music Entertainment Group
TME,
which reported earnings Tuesday, were down 12.1%.
The KraneShares CSI China Internet ETF
KWEB,
was off 2.7%.
Shares of Chinese tech companies have come under pressure in recent weeks amid concerns about increased regulation of private businesses, and reports of the coming Chinese privacy law added to that unease. The law is expected to place limits on data collection and require that entities obtain consent before gathering user information, according to The Wall Street Journal.
Alibaba is familiar with China’s regulatory arm, having paid a $2.8 billion antimonopoly fine earlier this year due to its actions toward merchants that were looking to sell on other platforms as well. Alibaba also has a stake in Ant Group Co., a fintech company that had to shelve its recent plans for an initial public offering following government pushback.
China recently cracked down on the education sector with new restrictions on after-school tutoring businesses. It also clamped down on ride-hailing business Didi Global Inc.
DIDI,
The KraneShares CSI China Internet ETF has fallen 41% so far this year as the S&P 500
SPX,
has risen 18%.
