China's Didi Chuxing Technology Co.'s American depositary shares - trading as Didi Global, Inc. in the U.S. - are expected to open another 1.42% lower Friday on the New York Stock Exchange.
The shares shed most of a 50% rally in pre-market trading after the ride-hailing company denied a report by The Wall Street Journal it was considering to go private.
Jay Ritter, a finance professor at the University of Florida specializing in new offerings, described Didi's situation as "unique" and believed going private may be its most rational decision.
"Going public in the U.S. is having a negative effect on the company's regulatory situation in China, where by ending the U.S. listing, it might create value for the company," Ritter told Nikkei Asia.
Didi stock is expected to open Friday at $9.72 each. Following the Journal report the issue gained 18% but then gave back gains in the rest of trade Thursday and closed out the day at $9.86 each. They.
Didi Global, China's largest ride-hailing operator, listed its shares on the New York Stock Exchange in June.
The listing was the biggest stock sale by a China company since the 2014 listing of e-commerce company Alibaba Group Holding Inc.
Days after Didi's New York listing, the stock fell after China authorities announced a cybersecurity evaluation. Regulators launched an antitrust investigation, too, Reuters reported.
China is investigating Didi over national security and cybersecurity concerns about information kept by the company being leaked to the U.S.
Seven Chinese ministries investigated Didi's local offices in a first cybersecurity review July 16, the South China Morning Post said.
Didi had been in talks with investors, regulators and bankers to resolve the issues following its listing, the Journal report said.