The protests in Hong Kong have begun having an effect on American businesses and the stock market. Pressure from the Chinese government on companies that desperately want to build a presence in that country has resulted in pressure om several high-profile stocks.

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The latest victim is Activision Blizzard (NASDAQ:ATVI). When a professional gamer made a pro-Hong Kong statement in an interview, ATVI removed him from the tournament he was competing in, took away his tournament earnings to that point, and suspended him for a year. After the move made headlines and the company was criticized on social media for bowing to Chinese pressure, the negative PR helped drive Activision Blizzard stock to a 2.31% loss on Tuesday.

Activision Blizzard Suspends Hearthstone Player for a Pro-Hong Kong Comment

Hearthstone is a very popular online game. As of the end of 2018,  100 million people worldwide had played the game. It’s not just casual players who are into the game, ATVI promotes it as an eSports title and it generates high profits. At a Hearthstone world championship tournament in Taiwan earlier this year, the prizes were worth $1 million.

Over the weekend, at the Hearthstone Asia-Pacific Grandmasters tournament, ATVI ran into trouble. In a streamed post-match interview, a player, who called himself Blitzchung, put on a gas mask and said “Liberate Hong Kong. Revolution of our age!”

In a move that ultimately ended up hurting Activision Blizzard stock, the company removed the gamer from the tournament, took away his prize earnings, suspended him for a year and severed ties with the individuals who had interviewed him.

Activision Blizzard Stock Feels the Impact

Although the drama went down on Sunday, it was on Tuesday that ATVI really began to feel the heat. Protests against the move started on Twitter (NYSE:TWTR), became headlines and then started attracting the attention of politicians. And the politicians weren’t very happy with ATVI. For example, Senator Ron Wyden tweeted:

“Blizzard shows it is willing to humiliate itself to please the Chinese Communist Party. No American company should censor calls for freedom to make a quick buck.”

The Verge reported that some employees of Activision Blizzard were also lashing out at the company. Given the storm of negative press, it’s not surprising that f Activision Blizzard stock took a hit.

The China Effect 

The impact of the Hearthstone tournament news on Activision Blizzard stock is just the latest example of the effect of the tensions between the U.S. and China. The trade war between the two countries has had a big impact on the stock market, with tariffs and concerns about an economic slowdown hitting many companies. The protests in Hong Kong have only added fuel to the fire.

The NBA is currently embroiled in a mess of its own because of a pro-Hong Kong statement that resulted in Houston Rockets merchandise being yanked from stores in China.

The Hearthstone tournament situation hasn’t been great news for ATVI. It’s taken the shine off of ATVI stock after the successful launch last week of Call of Duty: Mobile — which was downloaded 35 million times in its first four days. Investors can take solace in the fact that the damage inflicted on Activision Blizzard stock is expected to be short-lived as Twitter and the headlines move on to the next crisis.

As of this writing, the author did not own shares of any of the aforementioned companies.