Shares of three Chinese companies hit by a regulatory crackdown on the tech sector soared in premarket US trading following signs that Beijing was lifting a probe that slammed the brakes on their operations.
Ride-hailing platform Didi Global, job recruiting platform Boss Zhipin, and Full Truck Alliance—dubbed “Uber for Trucks”—were barred from registering new customers during a yearlong investigation by China’s cyberspace watchdog.
But, as of Monday evening, Full Truck Alliance’s apps Yunmanman and Huochebang were taking on new customers for the first time in 11 months. The Wall Street Journal, citing unnamed sources, reported Monday that both Didi and Boss Zhipin’s apps will be allowed to relaunch on domestic app stores as early as this week.
Following the news, Didi surged more than 60% in New York, while Full Truck Alliance jumped more than 25% and Boss Zhipin—which saw its annual loss widen to RMB 1.1 billion (USD 165 million)—added more than 20%. Hong Kong’s Hang Seng Tech Index closed up 4.6% on Monday.
Last July, China’s top internet regulator cited national security concerns for opening up probes into Full Truck Alliance and Boss Zhipin.
That came just a day after Chinese regulators barred 26 of Didi’s apps from taking on new customers and forced it out of local app stores as the company pushed ahead with a USD 4.4 billion initial public offering in New York. Beijing had warned that the listing could pave the way for US regulators to gain access to sensitive domestic data.
Didi, which is reeling from a RMB 49.3 billion loss last year, later reversed course and said it would delist from the New York Stock Exchange.
The company has said previously that a US delisting was a must before it can complete the Chinese cybersecurity review and restore its app-based services, as well as seeking a listing on another exchange including Hong Kong.
Last Thursday, Didi filed a formal delisting application to the US Securities and Exchange Commission, which is expected to go ahead 10 days after it gains approval.
Barred from registering new users, Didi’s domestic market share declined from around 90% to below 70% by January, according to Chinese media, as its unrestrained rivals vied for its customers with promotional offers and aggressive pricing.
During the first quarter, Full Truck Alliance fulfilled 25.2 million orders, up 13.6% year-on-year, with a gross transaction value of RMB 53.6 billion, up 4.2% over the same period, according to the company.