Tencent, the world’s largest gaming company and one of the biggest social media service owners, saw its stock plummet in 2018, costing investors as much as $271 billion in losses. Tencent shares are now seeing a massive recovery fueled by opportunities from “Fortnite” and “Apex Legends” in China’s booming gaming sector and improving sentiment in the domestic stock market.
Tencent Stock Rebounds 50% Compared to Last October
Tencent’s share price has pumped over 8% this week alone. According to Bloomberg reporting and exchange data, Asian investors poured $304 million into Tencent stock on Monday. This compared to a dramatic low in October 2018 which saw the company plunge from being the world’s 5th-largest company by market value, right out of the top ten.
That said, Sinolink Securities analysts have urged investors to be cautious due to the magnitude of the rally and concern that Tencent stock might not be out of the 2018 woods just yet.
Indeed, Tencent’s booming share price may be partly attributed to a surprisingly-buoyant Chinese stock market. Despite data out of China pointing to an economic downturn severe enough to impact other global economies, China’s stock market is rallying to a three-year high. Driven by optimism over US-China trade dispute resolution, China’s core markets have seen a $1 trillion-dollar rally. Just days ago, the Shanghai Composite Index had its best day of trading since as far back as June 2015.
Last year, Chinese regulators imposed an almost year-long freeze on new gaming title approvals,