JD.com (NASDAQ:JD) stock is taking a beating on Thursday following news about Tencent (OTCMKTS:TCEHY) giving away its stake in the Chinese e-commerce company.
At least, Tencent will give away most of its stake in the company. It announced a special one-time dividend that will have it distributing shares of JD stock to its shareholders. That will have to reduce its ownership of the company’s stock by 457 million. That will drop its stake from 17% to 2.3%.
According to Tencent, it’s reducing its stake in JD.com because the company is now viable and doesn’t need its support. The Chinese company says that this is simply part of its investment strategy.
While that may be true, there could be other factors at play. Chinese regulators have been cracking down on companies growing too large with fees. It’s possible that Tencent decided to give away the majority of its stake in JD.com to avoid possible action from the government, reports CNBC.
No matter the reason, it’s JD stock that is feeling the heat today over Tencent’s move. That includes heavy trading of the shares. As of this writing, more than 18 million shares of the company’s stock have changed hands. That’s already above the company’s daily average trading volume of about 9.5 million shares.
JD stock is down 6.6% and TCEHY stock is up 5.4% as of Thursday afternoon. JD stock is down 20.2% since the start of the year and TCEHY stock is down 17.6% year-to-date.
Investors on the lookout for more stock market news will want to stick around!
We’ve got all the most recent stock coverage that traders need to know about for Thursday! A few examples include what’s happening with casino stocks, Nikola (NASDAQ:NKLA) shares riding higher, as well as the latest Pasithea Therapeutics (NASDAQ:KTTA) stock news. You can find all of that info by checking out the links below!
More Thursday Stock Market News
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- KTTA Stock Alert: 6 Things to Know About Pasithea Therapeutics as Shares Soar Today
On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
