Shares of several Chinese stocks including Alibaba Group Holding Ltd (NYSE:BABA), Baidu Inc (NASDAQ:BIDU) and Nio Inc (NYSE:NIO) are trading lower Tuesday amid growing COVID-19 concerns in China, with over 13,000 daily cases reported in Shanghai. The surge in cases has led US companies in China to reduce 2022 projections. Chinese stocks are also selling off following yesterday's strength which came amid a potential rule change that would allow Chinese companies to share sensitive data with U.S. regulators.
The China Securities Regulatory Commission on Saturday proposed revisions to rules which previously allowed only Chinese regulators to conduct on-site audit inspections of Chinese companies listed overseas. The unrevised rules forbid Chinese firms from sharing sensitive data and financial information with overseas regulators.
The changes appear to lower the risk of delisting, but some analysts remain pessimistic, according to a CNBC report.
"Global investors may be jumping the gun a little bit. Everything is very, very premature right now," Shehzad Qazi, managing director of China Beige Book International, said Monday on CNBC’s "Squawk Box Asia."
Former SEC chairman Harvey Pitt added: "This is clearly an effort by the Chinese government to create an appearance that there will be more transparency. The real devil will be in the details."
The cautious outlook from analysts may be contributing to the pullback in Chinese stocks Tuesday.
See Also: Why Alibaba, Nio And Other Stocks Are Not Trading In Hong Kong Today
BABA, BIDU, NIO Price Action: According to data from Benzinga Pro, Alibaba was down 5.4%, Baidu was down 4.56% and Nio was down 4.44% at time of publication.
Photo: courtesy of Alibaba.
