Why Chinese Tech Stocks Like Alibaba Stumbled Today
These days, many parents around the world are worried about the amount of time their children spend on smartphones and other devices. On Wednesday, the Chinese government acted the part of a very large mom or dad, recommending strict limitations on screen time. Investors took this as a threat to top tech companies in the country, and many of these stocks saw notable declines in price on Wednesday.
Few were spared. Alibaba (NYSE: BABA) fell by 5%, for example, while peers JD.com (NASDAQ: JD) and Tencent Holdings (OTC: TCEHY) declined a respective 4.5% and 3.8%. All three did significantly worse than the beleaguered S 500 index, which slumped by 1.4% on the day.
The Cyberspace Administration of China (CAC) was the entity behind the push. It stated that people under 18 years of age should be restricted to, at most, two hours of daily use on smart devices. The younger the user, the stricter the limits -- the CAC said users aged eight to 16 would get only one hour, and finally those under eight would receive a mere eight minutes per day.
Source Fool.com
