China's gaming regulator, the National Press and Publication Administration, proposed revised rules to address concerns, approving 105 new game licenses for December.

Shares of Tencent and NetEase saw brief recoveries, up 5% and 10%, respectively, following recent massive declines due to worries over gaming regulations, Reuters reports.

Despite the rebound, Nomura analysts indicated that while the softened approach might calm the market slightly, concerns linger over the regulatory impact, as per Reuters.

The new gaming rules, aiming to discourage gaming addiction and myopia among the youth, propose banning specific common in-game incentives and are open for public comments until January 24.

Though major players like Tencent showed some recovery, smaller gaming companies experienced lesser gains despite a recent slump in their stock prices.

Various gaming firms have initiated share buyback plans this week to reassure investors, yet the market impact has been relatively limited.

Price Action: BABA shares traded higher by 0.80% at $76.45 on the last check Wednesday.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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