China's video-game curbs shock stocks

China's raft of new measures limiting players' spending on video games sent ripples through stock markets across the globe on Friday.

Prosus fell as much as 20% in Amsterdam trading, erasing $17 billion of market value at one point, after the regulator's draft rules dealt a blow to the value of the company's holding in Chinese internet giant Tencent. South African parent Naspers also slumped by a fifth.

In Hong Kong, Tencent, in which Prosus holds a 25% stake, closed down 12%. In New York, the Nasdaq Golden Dragon China Index of US-listed Chinese stocks declined 2.4%, with video-game maker NetEase leading losses.

Ubisoft Entertainment, which Tencent invests in, fell as much as 8% in Paris trading, while US peer Unity Software also declined.

China's gaming regulator on Friday published draft rules aimed at clamping down on practices that encourage players to spend more money or time in online games.

A sweeping set of curbs on in-game rewards for frequent logins and purchases stoked fears of another industry crackdown in the world's biggest mobile gaming arena. Prosus's share-price slump shows that it's sensitive to factors outside of its influence, according to Bloomberg Intelligence analyst John Davies. Its Tencent stake "casts a shadow over its other investments, and appears unlikely to change soon," he said.

Prosus's stock performance is closely linked to Tencent's, as three-quarters of its sum-of-the-parts value lies within the Chinese conglomerate. The Dutch firm counts on Tencent as its biggest investment in technology stocks.

Prosus has been trimming its investment in Tencent for more than a year to fund a buyback programme. The company said earlier this month that its ownership dropped below 25%.In Johannesburg, local benchmark the FTSE/JSE Africa All Shares Index declined as much as 1.8%, with Naspers and Prosus the biggest drags on the market.