(Bloomberg) — China’s rolling regulatory crackdown on unfair markets has found new targets, with liquor makers, cosmetics firms and online pharmacies in the cross-hairs.

A slew of commentary and reports in state media called for better oversight of these industries on Friday to protect consumers, adding to earlier rulings targeting private tuition firms and technology firms as President Xi Jinping seeks to address inequality.

Distillers led a decline in the benchmark CSI 300 Index after it was reported that liquor producers will meet the regulator over market order. The nation’s biggest liquor maker Kweichow Moutai Co. plunged as much as 4.3%. Online health care stocks also dropped, with JD Health International Inc. down 13% after the People’s Daily urged more protection and guarantee of prescription drugs sold through the internet.


The plunge in these new sectors comes at a time when investors have become super-sensitive about which companies will be the target next of official scrutiny. Over the past weeks, there’s been selloffs in everything from private tutoring firms to e-cigarettes, games and infant formula amid a new regulatory drive stressing social equality.

“With regulation worries and the beginning of a downturn in economic growth, it’s extremely hard to make money right now,” said Hou Anyang, fund manager at Frontsea Asset Management in Shenzhen. “At this rate even the winning stocks in electric vehicles and chips may not stay strong much longer.”

State media also turned up the heat on the cosmetic surgery industry, calling for better oversight in the face of incomplete regulations and growing medical disputes. Ping An Healthcare & Technology Co. dropped by as much as 17%, its biggest intraday decline ever.

Foreigners net sold 6.5 billion yuan ($1 billion) worth of mainland shares via the trading links as of the mid-day break in Shanghai and Shenzhen, after dumping 10.7 billion yuan on Thursday, the most this month.

Meanwhile redemptions from China equity products could be picking up pace as the year-to-date underperformance of some funds is “causing additional difficulties in recapturing substantial inflows in the short term,” Morgan Stanley quant analysts wrote in a note this week.

More stories like this are available on bloomberg.com

Subscribe now to stay ahead with the most trusted business news source.

Read More