Hi Reader, here's what you need to know for August 4th in 3:04 minutes.

😎 Our next Crowdfunding Club on August 11th introduces two extraordinary founders from Rizome and Chisos. This is your chance to grill them and find out if their businesses could be the next big thing. Get your free ticket here

Today's big stories

Tencent’s stock dropped after investors worried that the Chinese government would target the media and gaming titan next
China’s turned against some of its biggest money-spinners lately, and one of its next targets could be the most drastic of all – Read Now
BP announced stronger-than-expected quarterly results, and the oil giant's set a high bar for its European rivals

League Of Losers

What’s Going On Here?

Tencent’s stock fell by the most in a decade on Tuesday, after murmurs grew that the gaming industry would be next to fall to China’s might.

What Does This Mean?

The Chinese government has been on the warpath in the last few months, barreling its way through the country’s tech, fintech, and for-profit education industries to name a few. So when a state-owned news outlet accused kids of spending too much time playing “electronic drugs” – video games – investors were suddenly nervous that gaming would be next. That encouraged them to sell off a host of the sector’s stocks: Tencent’s shares dropped by 6% on Tuesday, NetEase’s by 10%, and Japan’s Nexon – which makes about 30% of its revenue from China – by 7%.

Why Should I Care?

For markets: This bruise might not heal.
Tencent’s shares were down as much as 11% at one point, but China’s biggest public company did manage some damage control – namely by promising to limit the amount of time kids can spend playing its games. But Alibaba – which announced weaker-than-expected quarterly results on Tuesday – is proof that this might cause lasting problems: the ecommerce giant’s shares have now fallen 25% in the last six months. Still, it’s trying to put a positive spin on the situation, committing to buying back more of its shares this year and next.

For you personally: Stay safe out there.
You might be skittish about investing in China right now, so it’s just as well that Goldman Sachs published new analysis on which sectors to avoid and which to invest in. The investment bank suggested steering clear of those exposed to antitrust, capital markets, social equality, and data security, and gravitating more toward consumer staples, energy and utilities, and machinery and materials.

You might also like: How to profit from China’s explosive economic growth.

Copy to share story: https://www.finimize.com/wp/news/league-of-losers/

🙋 Ask a question

2. Analyst Take

The Shaky Legal Vehicles That Could Bring Down The Chinese Stock Market

What’s Going On Here?

Chinese companies across the board have had a tough time of it lately.

And according to TS Lombard’s Oliver Brennan, US-listed Chinese companies are in just as vulnerable a position.

See, firms that struggle to get approval to list on the US stock market have for years used a special kind of corporate structure – known as a “VIE” – to avoid asking permission.

And even though it’s a workaround, the country’s largely been on board with VIEs. They bring a lot of foreign money into China, after all.

But if recent developments have proved anything, it’s that Chinese policymakers can change their minds in an instant. And if they do, investors might start ditching the country’s stocks in their droves.

So that’s today’s interview: Oliver Brennan on how VIEs work, why they’re so risky, and where the safer opportunities lie if you’re interested in China.

Read or listen to the Insight here

$21 billion and counting

The real estate market is booming, and it’s showing no signs of slowing down.

But it’s no secret how difficult it is to tap into that market if you don’t have a platform like CrowdStreet.

So it’s a good thing you have a platform exactly like CrowdStreet, which gives you unparalleled access to institutional-quality real estate deals.

In fact, over the last seven years, CrowdStreet’s investors have funded more than 500 real estate projects – from grocery stores to data warehouses – across the US. That’s almost $21 billion worth.

And with the pandemic-bruised world changing all around us, the real estate industry will have to change with it. And that means even more opportunities for investors like you.

Here’s to the next 500 deals: find out more about CrowdStreet.

Find Out More

Disclaimer: This content was written by Finimize, a paid partner of CrowdStreet, Inc.(“CrowdStreet”) and has been prepared solely for informational purposes.