Goldman Sachs says Chinese stocks worth $3.2 trillion are at risk as regulators turn up the pressure on 4 industries

Goldman Sachs says Chinese stocks worth $3.2 trillion are at risk as regulators turn up the pressure on 4 industries

Goldman Sachs said private-sector companies in China worth a combined $3.2 trillion face regulatory risks, and listed four industries that could be targeted by government officials. "Industries such as internet, education, media & entertainment, real estate, and healthcare could be disproportionately exposed to further regulatory attention, everything else being equal," Goldman's strategists wrote in a Wednesday note. A wave of regulation could have a range of potential impacts on corporates. It could result in buying opportunities and the chance to invest in structural winners in China, or in an extreme scenario, private enterprises could be nationalized or subject to regulated profitability, the team said. ,and comments from state-sponsored media outlets on linked to people's daily lives, indicate that social welfare is high up on the policy agenda, Goldman added. "Policymakers could prioritize social fairness/stability over the capital markets in areas that might be considered as social necessities," the note said. Strategists including Kinger Lau, Timothy Moe, and Si Fu said they had recently held conversations with investors to discuss China's ongoing regulatory environment, and believe changes are set to continue. "Most investors we have spoken to believe more regulations will be unveiled this quarter and next although the intensity/severity of