What happened: Chinese stock markets tumbled Monday after US president Donald Trump threatened to raise tariffs on Chinese imports. The benchmark Shanghai Composite Index has dropped 11% from an April high after surging at the start of the year, marking its biggest loss since 2016. The stock market slumped as China readies its Nasdaq-style board, the Science and Technology Innovation Board, to launch on the Shanghai Stock Exchange as soon as next month. Analysts said that the slump could impact the progress of the new tech board, and might even lead to a postponement.
Why it’s important: The new tech board is expected to provide a new option for initial public offerings (IPOs) of Chinese high-tech firms thanks to its relatively low threshold for listing. If the rollout of the new board is delayed, more than 100 Chinese tech firms will face unknown wait times to list. The US-China trade war is impacting Chinese tech firms: Video game live-streaming platform Douyu delayed its IPO roadshow on Monday due to global market turmoil. Tech firms are particularly susceptible because they are more vulnerable to market volatility than companies in traditional industries.