London Daily

Focus on the big picture.
Sunday, Nov 01, 2026

Shocked Investors Scour Xi’s Old Speeches to Find Next Target

As $1 trillion evaporated from Chinese stocks last week, some investors realized they hadn’t paid enough attention to the country’s most important man: President Xi Jinping.
Traders began scouring Xi’s speeches to find clues about which industries might be next after his administration abruptly smashed the country’s $100 billion for-profit education sector, according to several employees at Chinese financial firms who asked not to be identified. Screenshots of key passages made the rounds: Xi denouncing “obscene” online content, education inequality and housing-price speculation in school districts.

A government database of more than 11,000 speeches since Xi took power in 2012 became a key resource.

The jitters continued this week, with Tencent Holdings Ltd. shares plunging after the Economic Information Daily - an offshoot of the official Xinhua News Agency - decried the “spiritual opium” of online gaming, sparking worries that the sector might be next on the chopping block.

The selloff extended to Japanese gaming developers that have licensing deals with Tencent, China’s most valuable corporation.

“Investors and analysts have tended to dismiss party-speak, usually because it’s so impenetrable,” said Dan Wang, a technology analyst at Gavekal Dragonomics in Shanghai, who regularly reads the Qiushi Journal, a bi-monthly Communist Party publication.

“But much of it is perfectly readable, and we should know at this point that Xi usually follows through on what he says.”

Reading the signals from Beijing has always been a crucial component of doing business in China.

But the abrupt education overhaul has prompted even seasoned investors to reassess how they interpret statements from Xi and top officials in his government - a task made more difficult by the fact that many of his speeches are classified and only made available to the party elite.

Compounding the problem is Xi’s likely push for a third term ahead of a once-in-five-year meeting of party leaders next year in which key positions are up for grabs.

That has rank-and-file members all eager to please Xi, who has amassed more power in China than any leader since Deng Xiaoping in the 1980s and 1990s.

“With power mostly centralized in his hands, Xi now can change status quo policy quickly and even without much warning,” said Victor Shih, associate professor at UC San Diego and author of “Factions and Finance in China: Elite Conflict and Inflation.”

“On top of quick policy changes, officials below him will want to zealously implement any new policy or ‘spirit,’ the party’s term for policy direction,” Shih added.

“This zealous implementation will often take place regardless of the longer-term consequences because officials are afraid of being accused of lackluster implementation.”

The opacity in China’s political system forces investors to gauge the importance of various statements from officials and state-run media.

After many market players shrugged off Xi’s criticism of out-of-school tutors back in June, this week’s Tencent selloff prompted them to dig up a Xi speech from March in which he identified “a lot of obscene and filthy stuff online” as one of a number of social problems that need to be addressed.

One element to watch is which agency makes the announcement, and over the past decade there’s been an increasing amount of joint statements that span different arms of the government and the party.

China’s ban on profits for its tutoring industry was jointly issued by the general offices of top government and party bodies - the State Council and the party’s Central Committee - giving the decision more authority than any single department.

While China’s policy moves can feel ad hoc particularly to foreign investors, the changes are quite targeted on certain sectors, said Jason Hsu, founder and chief investment officer of Rayliant Global Advisors.

“Right now, it feels like throwing the baby out of the bathwater and every industry is at risk,” he said. “If you are more aware of what the Chinese has been communicating all along, you know what they will do.

Real estate, health care, retirement living -- these are identified by policy makers as undermining societal harmony, and the quality of life.”

Still, authorities have sought to address misunderstandings in the market. Following the wild selloff last week, the China Securities Regulatory Commission promised more transparency and policy predictability in a Q&A posted on its website Sunday.

State media have also either tweaked articles or published commentaries to try to calm market jitters.

On Tuesday, the Economic Information Daily removed the link to its piece on online gaming, while the People’s Daily newspaper - the party’s official mouthpiece - published an editorial in its overseas edition stressing the need for government, schools, families and broader society to work together to better protect children from excessive gaming.

Markets were likely to remain volatile as investors adjust.

Even while it’s now “fairly obvious” which sectors Xi wants overhauled, “the timing and sequencing of Beijing’s regulatory actions will remain chaotic,” said Jude Blanchette, Freeman chair in China Studies at the Center for Strategic and International Studies.

“The scope and severity of the current regulatory storm looks obvious only in retrospect,” Blanchette said.

“I’m not aware of anyone who read Xi’s 2018 speech on education and said, ‘He’s going to crush the for-profit education sector in three years hence.’”
Newsletter

Related Articles

0:00
0:00
Close
Home Office Expands Border Security Operations and Intelligence Sharing With European Partners
Office for National Statistics Reports Modest Retail Sales Growth Ahead of Crucial Christmas Trading Season
Welsh Government Unveils Strategic Plan to Boost Regional Technology Innovation and Digital Skills Training
Department for Environment Food and Rural Affairs Implements New Agricultural Subsidies Framework for English Farmers
Scottish First Minister John Swinney Announces Major Regional Infrastructure and Green Energy Investment Strategy
National Health Service Leaders Warn of Severe Winter Pressures and Mounting Accident and Emergency Backlogs
Bank of England Monetary Policy Committee Signals Cautious Interest Rate Path Amid Persistent Services Inflation
Chancellor of the Exchequer Rachel Reeves Finalizes Autumn Budget Framework Aiming to Close Public Sector Fiscal Gap
Department for Science, Innovation and Technology Prepares Enhanced Artificial Intelligence Safety and Cyber Defense Frameworks
United Kingdom Government Expands International Sanctions Framework Against Russian Shadow Fleet and Financial Enablers
Institute of Directors Reports Sharp Post-Budget Drop in Business Confidence Despite Long-Term Investment Intention Shifts
Chancellor John Healey Defends Sweeping Fiscal Adjustments and Household Support Packages Following Autumn Budget
Parliamentary Petitions Committee Schedules Major Legislative Debates on Special Educational Needs and Non-Stun Meat Labelling
Regional Devolution and Good Growth Fund Frameworks Reshape Local Government Funding Across English Regions
Loughborough University Economic Analysts Highlight Substantial Uncertainty Surrounding Public Sector Efficiency Savings
British Legal Sector Drives Sixty Billion Pounds in Annual Economic Output While Employing Over Half a Million Professionals
Law Society Welcomes New Better Regulation Executive While Pressing for Long-Term Legal Aid Funding Reform
Metropolitan Police and Security Services Heighten Operations Across London Ahead of Large-Scale Public Demonstrations
Bank of England Economists Scrutinize Corporate Tax Adjustments and Public Sector Borrowing Pressures
Chancellor John Healey Defends Autumn Budget Tax and Spending Allocations Following Intense Parliamentary Scrutiny
Department for Environment, Food and Rural Affairs Implements Strict Water Quality Monitoring Rules Following Severe Rainfall and Flooding
Welsh Government Unveils Comprehensive Regional Housing Strategy to Address Rural Affordability and Homelessness Pressures in Cardiff
Office for National Statistics Reports Slowing Consumer Price Inflation and Steady Retail Performance Across United Kingdom Markets
Northern Ireland First Minister Michelle O'Neill and Deputy First Minister Emma Little-Pengelly Advance Cross-Border Infrastructure Agreement in Belfast
Competition and Markets Authority Launches Formal Investigation Into Artificial Intelligence Partnerships Involving Major Technology Corporations
Scottish First Minister John Swinney Secures Cross-Party Support for Devolved Budget Framework and Renewable Energy Expansion
High Court Rules in Favor of Environmental Campaigners Over Department for Energy Security and Net Zero Licensing Procedures
National Health Service England Announces Major Digital Modernization and Artificial Intelligence Diagnostic Rollout Across Regional Trusts
Bank of England Monetary Policy Committee Signals Cautious Approach to Interest Rate Cuts Amid Persistent Wage Growth and Inflation Pressures
British Prime Minister Keir Starmer and Chancellor Rachel Reeves Outline Strategic Infrastructure Plans to Boost Regional Growth and Private Investment
Water pollution remains high despite £5bn investment
Regional Economic Divergence and Industrial Transformation
Technological Sovereignty and Regulatory Scrutiny
Fiscal Consolidation and Public Service Pressures
Automotive Industry Leadership Warns of Imminent Supply Chain Disruptions Following Recent European Trade Negotiations
High Court Delivers Landmark Ruling Affirming Strict Legal Protections for Corporate Data Privacy Against State Surveillance
Welsh First Minister Eluned Morgan Secures Additional Funding for Regional Transport Infrastructure and Rail Modernization
Scottish First Minister John Swinney Announces Major Green Energy Infrastructure Investment Package for Aberdeen
Department for Work and Pensions Proposes Sweeping Welfare Reforms to Incentivize Long-Term Unemployed Back into Work
Competition and Markets Authority Launches Formal Investigation into Artificial Intelligence Partnerships Involving Major Tech Giants
United Kingdom Foreign Secretary David Lammy Concludes High-Level Strategic Talks in Washington on Middle East Security
National Health Service England Unveils Emergency Winter Resilience Plan to Combat Projected Surge in Emergency Admissions
Bank of England Governor Andrew Bailey Signals Cautious Approach to Interest Rate Cuts Amid Persistent Inflation
British Chancellor Rachel Reeves Finalizes Corporate Tax Overhaul Ahead of Autumn Budget to Fund Public Services
Automotive Manufacturers Urge Government Action as High Energy Costs and Global Supply Chain Disruptions Threaten Production
Metropolitan Police Issue Formal Apology Following Inadvertent Release of Confidential Information During High-Profile Investigation
Scottish Finance Secretary Shona Robison Unveils Devolved Budget Highlighting Housing and Public Service Adjustments
Energy Regulator Office of Gas and Electricity Markets Prepares to Remove Household Gas Standing Charges Following Treasury Mandate
Treasury Confirms Reversal of Planned Cash Individual Savings Account Allowance Reduction Protecting Twenty Thousand Pound Limit
Office for Budget Responsibility Revisions Predict Moderate United Kingdom Economic Growth with Elevated Inflation Pressures
×