The Chinese government’s mixed messages are whipsawing markets and keeping foreign investors wary of investing in China. Last year, Chinese President Xi Jinping tried to woo back foreign capital while also trying to reshape China’s business environment. President Xi is attempting to promote policies that will revive an economy that is weighed down by a struggling property market while strengthening national security as military and trade tensions rise with the U.S.
The latest events in China have given mixed messages to investors. On December 22, Chinese regulators shocked gaming companies with unexpected new rules to limit in-game spending and prohibit mechanisms to incentivize more playtime. That led to a selloff in gaming stocks that wiped $80 billion in market value from companies like Tencent Holdings. However, Reuters reported today that authorities fired the country’s top gaming regulator and said it may review the controversial new gaming restrictions, suggesting a heightened sensitivity to offending the markets.
