Shares on stock exchanges in mainland China and Hong Kong fell sharply during trading on July 26 to a record this year. The collapse is associated with fears of investors, provoked by stricter regulation in education and the technology sector in the country.

Sale of shares in Hong Kong’s Scholar Education Group led to a fall in the value of securities by more than 45 percent, while New Oriental Education & Technology Group Inc fell more than 47 percent after falling by more than half in the United States on July 23. These companies offer educational services in China. The CSI Education Index fell 9.61 percent to its lowest level in 16 months. The market reaction is connected with Beijing’s intention to seriously complicate access to finance and operations for companies in the industry.

China’s “blue-chip” index CSI300 fell 3.22 percent to its lowest level since December. The Composite Index of the Shanghai Stock Exchange dropped 2.34 percent to its lowest level in more than two months, while the Shenzhen Stock Exchange dropped 2.28 percent. This happened due to the fact that foreign investors were eager to get rid of their shares. Refinitiv data shows that the outflow of funds from common stock on July 26 reached almost $1.4 billion.