Alibaba's HK shares fall 9.9pc
Alibaba Group's Hong Kong shares closed down almost 10 percent on Friday after it scrapped plans to spin off its cloud business, citing uncertainties fuelled by US curbs on exports to China of chips used in artificial intelligence applications. The stock opened down 7.8 percent and then deepened its loss to 10.3 percent by mid-morning. It ended the day 9.9 percent lower at HK$73.25. It was the first reaction in Asia since the stunning strategy reversal was announced late on Thursday. The company's US listed securities closed down nine percent. Alibaba's concerns over the US export curbs announced by Washington in October come on the heels of similar worries raised this week by Chinese social media and gaming company Tencent Holdings which said the restrictions would force it to seek domestically produced alternatives. Alibaba, once Asia's most valuable stock, was worth around US$830 billion at its peak in October 2020 but is now valued at less than one fourth, as the e-commerce company took centre-stage in Beijing's technology sector crackdown and as the Chinese economy slowed. The latest Alibaba news underscores broader hurdles facing China's big tech companies as the export curbs make it harder for them to get crucial chip supplies from US companies. In March, Alibaba announced plans to carve out the cloud business as part of the biggest restructuring in its 24-year history that broke the company up into six units. Analysts had estimated then the cloud division could be worth US$41-US$60 billion but had warned that its listing could attract scrutiny from both Chinese and overseas regulators due to the reams of data it manages. (Reuters)_____________________________
Last updated: 2023-11-17 HKT 16:39 