Alibaba capitalization evaporated $ 26 billion in a moment after news that a person surnamed Ma was banned from moving
A flash of worry over the fate of Alibaba Group Holding co-founder Jack Ma caused a wild swing in the e-commerce company’s shares on Tuesday, Bloomberg reported. The incident once again underscored investor anxiety over China’s tech sector after a year-long correction.
Alibaba shares plunged 9.4% on the Hong Kong Stock Exchange, wiping out about $26 billion in market value. This comes after state broadcaster CCTV reported that authorities in Hangzhou – where Alibaba is based – had imposed travel bans on an individual with the surname Ma.
Alibaba shares then rallied when a statement from Hangzhou police said the accused’s name was spelled with three Chinese characters. Meanwhile, Jack Ma’s Chinese name Ma Van consists of only two characters.
Willer Chen, an analyst at Forsyth Barr Asia, said investors’ reaction “shows relatively weak sentiment in the tech sector. I think the market is a bit too sensitive on this.”
In fact, the Global Times, citing unidentified sources, said that Ma was allegedly working as a hardware research and development director at an IT company. CCTV said this person was put into so-called “restrictive measures” on April 25 after being accused of inciting subversion of state power and other activities endangering national security. .
CCTV’s two-sentence report has alarmed investors with Beijing’s grip on every nook and cranny of the internet, starting by targeting Jack Ma. Regulators had halted Ant Group’s IPO plans earlier.
The brief, two-sentence report made investors nervous about Beijing’s year-long grip on every nook and cranny of the internet, starting by targeting Jack Ghost. Earlier, Beijing halted the IPO of Ant Group Co. before launching a campaign to clamp down on allegations of abuse and rapid growth by the increasingly powerful internet companies.
Chinese authorities in the city of Hangzhou, where both Alibaba and Ant are based, were unavailable for comment. Representatives for Alibaba and Ant also did not immediately respond to requests for comment from Bloomberg.
In mid-April, Bloomberg reported, citing private sources, that China’s top anti-corruption watchdog was directly participating with many other units in a recent investigation into Jack’s Alibaba connection. Ma and Chinese state-owned companies. This information increases the risk for tech mogul Jack Ma and his massive Internet empire.
Specifically, China’s Central Commission for Discipline Inspection (CCDI) is looking into Alibaba’s influence and the extent of its dealings with banks and state-owned enterprises.
CCDI was originally the body in charge of corruption issues involving high-ranking officials. The agency was reported to have participated in inquiries sent to state-owned companies in February as part of an investigation into former Hangzhou Party chief Zhou Jiangyong. Both Ant and Alibaba are headquartered in Hangzhou.
Source: Bloomberg
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