French stocks fell notably on Monday after the tutoring and education tech sector became the latest target of China’s sweeping regulatory crackdown.
Chinese authorities introduced a new set of sweeping regulations on private educators, which includes prohibiting tutoring for profit in core school subjects to reduce financial pressures on families.
The policy change also restricts foreign investment in the sector through mergers and acquisitions, franchises, or variable interest entity (VIEs) arrangements.
Separately, China’s antitrust regulator ordered Tencent to end its exclusive music licensing rights, a step aimed at tackling the company’s dominance of online music streaming in the country.
U.S.-China tensions also weighed, with Chinese Vice Foreign Minister Xie Feng saying that the relationship between the world’s two largest economies “is now in a stalemate and faces serious difficulties.”
The benchmark CAC 40 index dropped 39 points, or 0.6 percent, to 6,529 after rising 1.4 percent on Friday.
Faurecia shares slumped 4.3 percent despite the car parts maker posting higher first-half sales and profit, and upgrading its 2021 cash flow target.
Market Analysis
CAC 40 Edges Lower On China Concerns
2021-07-26 09:18:55
