Updated December 25th, 2023 at 18:29 IST
China stocks slip on decline in gaming shares
The blue-chip CSI 300 Index slipped of 0.1% while the Shanghai Composite Index recorded a 0.3% decline by the midday recess.
China's stock market witnessed a decline marked by a persistent slump in online gaming shares as the newly introduced regulations aimed at curbing spending on video games continued to impact investor sentiment. The Hong Kong market remained closed for the Christmas holiday, contributing to subdued market activity.
The blue-chip CSI 300 Index slipped of 0.1 per cent, while the Shanghai Composite Index recorded a 0.3 per cent decline by the midday recess. However, the notable shift was observed in the CSI Anime Comic Game Index, which tumbled 4.9 per cent, extending the 10 per cent drop from the previous session.
Despite efforts by regulators to address investor concerns, including a statement on Saturday expressing a commitment to refining the proposed rules based on public feedback, the online gaming sector continued to face headwinds. The proposed regulations are designed to restrict both the monetary and time aspects of video game engagement, impacting the world's largest gaming market and causing a decline in the valuation of major gaming companies such as Tencent Holdings and Netease.
On Monday, several gaming companies, including Giant Network Group, 37 Interactive Entertainment Network, and Kingnet Network, saw their shares hit the 10 per cent daily limit downward. This ongoing trend underscores the persistent negative sentiment within the sector.
Concurrently, stocks in the media sector experienced a decline of 2.6 per cent, further contributing to the overall market downturn. In contrast, defence shares managed to gain, registering a 1.6 per cent increase.
The market's response reflects the challenges faced by the gaming industry in China, as regulatory measures continue to evolve, impacting key players and reshaping market dynamics. Investors remain watchful for further developments and potential adjustments to the regulations, with the gaming sector's performance poised to be a focal point in the coming sessions.
(With Reuters inputs)
Published December 25th, 2023 at 09:54 IST