(Bloomberg) A Bloomberg Intelligence index gauging the stocks of China’s education firms has fallen by 27% in the last three days to the lowest since 2015 as renewed crackdown panic grip the market.
Shares of China Education Group Holdings Ltd plunged 21% on Thursday, with the total decline in the week increasing to 54% as investors took bets for Beijing’s additional crackdown on the sector.
The crackdown fears also saw short selling volume on Hope Education Group increase by 337% on Wednesday, adding to the gains of 671% the previous day.
Speculations of China’s crackdown grew over an unverified report that the Ministry of Education was seeking a ban of the variable entity structure that the education firms use to list overseas.
The reports also said that the tutoring firms are to be restricted on their school assets, tuition fee increases, and acquisitions.
Although no official reports have been given, investors grew concerned, saying that Beijing’s silence also heightened the selloff.
China’s tutoring stocks react: 0839: HKG is down -24.15%, 1765: HKG is down -12.77%
