Meituan closed 17.7% on Tuesday in Hong Kong, beating Monday’s massive 14% loss – making it the grocery company’s worst two days on record. Tech giant Tencent lost 9% in Hong Kong and had its worst day in around a decade.
Meituan’s slump – which has wiped out more than $ 62 billion in market value for the company since Friday – came as Chinese regulators issued new guidelines on Monday calling for improved standards for food suppliers.
China’s state administration for market regulation said in a statement that companies should take steps to ensure that drivers earn at least the local minimum wage in order to reduce the “intensity” of the workload, including “strengthening road safety education and training.” . Dimensions.
Meituan operates one of the largest grocery delivery platforms in China with hundreds of millions of users transacting through their app every year. The company said in a statement on Tuesday that it had “received and carefully studied” the new rules and would “strictly adhere to” them.
“We are committed to improving our compliance standards to protect the rights of our stakeholders, which includes delivery agents,” she added. “We believe that the publication of the new guidelines will benefit the healthy development of China’s Internet industry as a whole.”
Meituans Stocks are down more than 34% so far this year.
The stocks of other tech giants also fell. Shares in China’s two most valuable companies, Alibaba ( and )Tencent (, over the last 48. slipped Hours, with Alibaba in Hong Kong closing 6.4% on Monday and down another 6.4% on Tuesday. )
Tencent’s declines in the past two days have now wiped more than $ 100 billion off its market value.
As stocks plummeted, the company’s WeChat messaging platform announced Tuesday that it would suspend all new user registrations through early August. The move is related to an upgrade of its security systems in accordance with “relevant laws and regulations”.
Tencent was too was hit by an official order over the weekend to abandon its plan to acquire another music streaming player, China Music Corporation. Regulators cited competition concerns, finding that the Shenzhen-based tech giant has long been a market leader.
Tencent said in a statement on Saturday that it “fully” accepted the decision and “will strictly follow regulatory requirements.” It also committed itself to “fulfilling our social responsibility and contributing to healthy competition in the market”.
A noticeable cold
In total, the three tech giants – Tencent, Meituan and Alibaba – have lost more than $ 237 billion in the past 48 hours.
The Hang Seng TECH Index, a Nasdaq-like technology index that tracks the largest technology companies trading in Hong Kong, fell as much as 8% on Tuesday, contrary to the regional trend among many major indices.
In the past few months, China’s technology industry has suffered from a noticeable cold. According to analysts at Goldman Sachs, stocks of overseas-listed Chinese tech companies have fallen a staggering $ 1 trillion since February in the private education industry.
New rules released over the weekend aimed to educate fast-growing tutoring companies to prevent them from making a profit or raising funds in the stock markets. The announcement by the Chinese Ministry of Education has reduced the market value of several large, publicly traded education companies in the billions.
New oriental education and technology ( collapsed nearly 50% in Hong Kong on Monday and later closed New York by nearly 34%. )
In at least some cases, investors’ concerns may be exaggerated, according to Jefferies analyst Thomas Chong, who on Tuesday reiterated his recommendation to buy Meituan shares.
The company has long been working to improve conditions for drivers and has even hosted around 100 worker feedback sessions since last year, he wrote in a notice to customers on Tuesday.
“We see [the] Share price retreat due to policy details being excessive, “added Chong.
This isn’t the first time Meituan has been in the regulatory crosshairs. China opened an antitrust investigation into Meituan earlier this year, with authorities investigating its “exclusive trade deals”. The company was also one of dozens of Chinese tech companies summoned by officials in April who were asked to review and remediate anti-competitive behavior. In May, Meituan founder Wang Xing also got caught in hot water over a controversial poem he posted on social media – and then put it out.
– CNN’s Hong Kong office and Julia Horowitz contributed to this report.