Didi Global shares fell for a third consecutive day on Wednesday, dropping further below last week’s initial public offering (IPO) price, as China was said to consider closing a loophole used by firms listing their shares abroad.
The ride-hailing company fell as much as 6.5 per cent and traded at $11.77 as of 10 am in New York. The American depositary shares slumped 20 per cent in Tuesday’s session, and now trade more than 15 per cent from the $14 they were sold at in the IPO.
Didi’s offering was the second-largest US-listing for a Chinese firm on record. The company has lost more than $18 billion of market value so far this week, including about $15 billion on Tuesday alone.
“The Chinese government has made it very clear that they act in what they believe to be their own best interests,” said Steve Sosnick, chief strategist at Interactive Brokers. “This doesn’t rule out the idea that one could or should invest in China, it just changes the risk premium that is required.”
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