Beijing arrested a pro-democracy media tycoon in Hong Kong — then his stock quadrupled
Hong Kong activists are buying stock to have their voices heard
Next Digital, the Hong Kong activist’s penny stock
Next Digital stock has fallen steadily over the past five years—save for a relatively short-lived resurgence as Hong Kong protests intensified in the first half of 2019.
A penny stock, Next Digital’s market cap sat at around $30.6 million before today’s action. As of Monday’s market close, Lai’s company is now valued at nearly $87 million.
The Guardian notedauthorities arrestedLai for conspiracy to commit fraud and collusion with foreign forces, making him the most high-profile figure to be affected by the law.
Lai reportedly now faces prison sentences of three to 10 years—or even life—if charged and found guilty. However, what justifies either punishment remains unclear.
While some analysts think traders could be betting on a potential Beijing takeover of Next Digital (which could increase its stock price), at least one investment bank exec remains flummoxed by the sheer size of the surge.
“Definitely it’s not institutional investors buying the stock. I see many orders were placed via Futunn, a large portal for retail stock investors,”UOB Kay Hian’sSteven Leungtold Bloomberg. “Many could be speculating that the company will be sold, […] but I don’t understand why there are so many speculative trades.”
Story byDavid Canellis
David is a tech journalist who loves old-school adventure games, techno and the Beastie Boys. He’s currently on the finance beat.David is a tech journalist who loves old-school adventure games, techno and the Beastie Boys. He’s currently on the finance beat.
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