EXPLAINER: Risks underlie tumbling Chinese company shares

Foreign shareholders in China’s tech companies are learning what its entrepreneurs have long known: The ruling Communist Party’s decisions about what is good for the economy can hurt your business

BEIJING -- Foreign shareholders in China’s tech companies are learning what its entrepreneurs have long known: The ruling Communist Party’s decisions about what is good for the economy can hurt your business. The stock prices of internet giants Tencent and Alibaba and ride-hailing service Didi tumbled after President Xi Jinping’s government launched anti-monopoly and data security enforcement actions against them. Also this week, share prices of Chinese education companies fell after news reports that for-profit activity might be banned in core school subjects. The crackdown on some of China’s biggest private sector success stories prompted warnings about a “war on capitalism.” But regulators say the opposite is true. They say they are protecting the public, smaller companies, the financial system and competition.