Gaotu Techedu Inc. (GOTU), a Chinese education technology company, saw its stock plummet 5.14% in pre-market trading on Thursday, caught in a wider selloff affecting Chinese ADRs and ETFs. The decline comes amidst a perfect storm of economic and geopolitical factors weighing on Chinese stocks listed in the U.S.

The broader market sentiment towards Chinese equities has soured due to several factors. China's central bank held its key interest rates steady for the fifth consecutive month, disappointing investors hoping for more aggressive stimulus measures to boost the country's sluggish economic recovery. This decision stands in contrast to the Federal Reserve's recent reassurances about U.S. monetary policy, potentially making Chinese assets less attractive to international investors.

Adding to the pressure on Chinese ADRs is the news that the Trump administration is considering an executive order that could impose significant fines on ships made in China or fleets including Chinese-made vessels. This potential move, aimed at reducing U.S. reliance on Chinese manufacturing, has further dampened investor enthusiasm for Chinese companies with exposure to international markets.

While Gaotu Techedu's decline is part of a broader trend, it underscores the challenges facing Chinese tech and education companies in the current economic and regulatory environment. As investors reassess the risks associated with Chinese ADRs, companies like Gaotu may continue to experience volatility in the near term.