China slices a R500bn hole in the JSE
Chinese crackdown smacks the share prices of Naspers and Prosus, hurting SA’s pension funds
Trading screens resembled China’s flag this week — a few stars, but mostly red — after another regulatory crackdown on Big Tech companies.Ructions from the sell-off, sparked by the fact that Chinese authorities tightened the noose around education technology and music streaming businesses, were felt around the globe — and nowhere more acutely than on the JSE, which is dominated by the technology giants Naspers and Prosus.Since Naspers owns 73% of Prosus, which in turns holds 29% of Tencent — the poster child for the internet economy in China — the entire SA market was dragged down. From a high of HK$757 in February, Tencent had slid to HK$446 by Tuesday, a drop of more than 40%.This meant that in the first two days of this week, Naspers plunged 14%, erasing R180bn from its market value, while Prosus tumbled 14.3%, wiping R322bn off its value.Both have now fallen to 15-month lows. And, since they are considered must-haves by the asset managers who invest people’s pensions, South Afr...
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