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Didi Plunges As Chinese Authorities Crack Down

imageStock Markets19 minutes ago (Jul 06, 2021 05:31AM ET)

(C) Reuters.

By Dhirendra Tripathi

Investing.com – Didi Global (NYSE:DIDI) was trading more than 20% lower in Monday’s premarket trading as authorities in China blocked the company from accepting new users and told mobile app stores to take the ride-hailing app off their platforms.

Reports says the authorities in China are concerned over the vast troves of consumer data the company possesses. Didi is now a listed company in the U.S. and therefore has to make disclosures to comply with the norms laid down by the Securities and Exchange Commission, a scenario the Chinese authorities may not be very comfortable with.

A WSJ report said China’s cybersecurity watchdog had suggested the Chinese giant delay its initial public offering and urged it to conduct a thorough self-examination of its network security. Didi listed on the NYSE on Wednesday, reportedly under pressure from early investors looking to cash out. It closed Friday’s session at a market cap of $18.51 billion. Markets were shut in the U.S. on June 5 on account of Independence Day.

The move is also likely to be reflected in SoftBank (OTC:SFTBY) ADRs, given that the Japanese company is a big investor in Didi. Softbank’s shares in Japan fell over 5% on Monday but recovered by 1% on Tuesday.

Didi Plunges As Chinese Authorities Crack Down

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