US urges caution for investors amid China’s corporate crackdown

The Nasdaq Golden Dragon China Index, which tracks 98 of China’s biggest firms listed in the US, plunged Tuesday after Chinese regulators issued a set of draft rules aimed at preventing unfair online competition.

Chinese stocks listed in the U.S. are facing another wave of selling pressure as authorities in Beijing ramp up their crackdown on some of the nation’s largest companies. The Nasdaq Golden Dragon China Index — which tracks 98 of China’s biggest firms listed in the U.S. — plunged by as much as 4.5% Tuesday after China’s State Administration for Market Regulation issued a set of draft rules aimed at preventing unfair online competition. The announcement came just hours after the state-backed People’s Daily newspaper issued a commentary saying China would increase scrutiny of the entertainment sector and what it called “idol culture.”