CSRC targets two U.S.-listed brokerages for operating in mainland China without licenses, sparking sell-offs in Chinese equities.
Shares of Futu Holdings (FUTU) and UP Fintech Holding (TIGR) plunged after the China Securities Regulatory Commission accused them of operating in mainland China without proper licenses and facilitating unauthorized cross-border trades. The crackdown sent ripples through U.S.-listed Chinese stocks, including Alibaba, as investors weighed regulatory risks.
FUTU and TIGR, both listed in the U.S., have faced scrutiny over compliance with Chinese financial regulations. The CSRC’s move follows heightened oversight of cross-border financial services, though no formal penalties have been announced. Similar actions in the past have led to prolonged volatility in affected stocks.
The broader market reaction was muted for other Chinese equities, though sentiment remained cautious. Tesla (TSLA) shares rose slightly after confirming the availability of its Full Self-Driving Supervised feature in China, offsetting some pressure on tech stocks.