Chinese Gaming Stocks Recover After Regulator Softens Stance on New Rules

Shares in Tencent and NetEase rebound following initial panic over proposed regulations to limit online gaming.

China's National Press and Publication Administration (NPPA) proposed new regulations to limit online gaming, causing a significant drop in shares of major gaming companies including Tencent and NetEase.
The proposed rules include spending limits for online games, a ban on games from rewarding players for daily logins, and a prohibition on lucky draw features for minors.
Following the announcement, Tencent's shares fell by more than 12%, losing over $43bn in market value, while NetEase shares fell by more than 24%.
However, the regulator later appeared to soften its stance, stating that it had heard the concerns raised and that there may be further modifications to the proposals.
Despite the initial market panic, shares in Tencent and NetEase began to recover, with Tencent trading about 5% higher and NetEase rising 10%.