China-based game-streaming platform company Huya (NYSE: HUYA) saw its stock pull back on Monday, falling as much as 14.6%. Shares finished the trading day down about 12.2%.
The stock’s decline comes amid a broader decline on Monday among Chinese internet stocks. Some investors were spooked when The Wall Street Journal said President Trump plans to stifle investment from Chinese businesses in U.S. technology companies and block technology exports to Beijing. The Journal cited “people familiar with administration plans” as its sources for the story.
While Huya doesn’t market its online game-streaming platform in the U.S., macroeconomic factors resulting from a potential trade war could negatively impact business. Further, Huya listed its ability to “explore strategic investment, acquisition and overseas expansion opportunities” as one of its business strategies in its F-1 filing earlier this year.
Trade tensions in the U.S. could make these initiatives more difficult.
Huya stock has also been on a roll since its IPO earlier this year, making the stock more susceptible to a pullback. Even after today’s decline, Huya stock is up about 100% since going public in May.
If these new stipulations come to fruition, they may limit companies with 25% or greater Chinese ownership from buying U.S. companies the White House deems “industrially significant technology,” said the Journal.
These new rules could be announced by the end of the week, the sources said.
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