Shares of Alibaba Group Holding Ltd tumbled to the lowest level in nearly six months on Thursday, following which Chinese regulators launched a no-confidence probe into the e-commerce giant.
Alibaba’s policy was Alibaba’s policy to “choose one of two”, which requires Alibaba’s business partners to deal with competitors, the Associated Press reported.
“[W]E is not surprised by the announcement of the investigation, ”analyst Aaron Kessler at Raymond James wrote in a note to clients. “We believe the most likely outcome is the termination of these exclusive relationships, although the potential revenue impact (such as consumers shopping on other platforms) is difficult to determine.”
Kessler reiterated its strong buy rating on Alibaba since at least February 2018.
Alibaba’s stock BABA,
Morning trading fell 13.8%, and closed for the lowest time since 1 July. The shares are facing the biggest one-day decline since the fall in public in September 2014, as the current record decline on January 29 is 8.8%. , 2015.
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With Selloff, the stock has crossed into bear-market territory as a 20% or more drop at the Wall Start mark. The stock was currently down about 30.4% to its record.
Since closing at a record $ 317.14 on October 27, the stock closed at $ 255.1 on December 15 at 19.6%. Wednesday closed at $ 256.18 before crossing some losses. A bear at or below $ 253.71 would make the market “official”.
Kessler said he believes the stock’s record decline has increased its height, with investors already worried about an “oversized pricing” investigation. As a result, we “remain buyers” of Alibaba’s stock at current levels, he said.
Saffron has a $ 330 target on Alibaba’s stock, 49.5% above current levels.
The stock has shed 18.2% in the last three months, while iShares MSCI China Exchange-Traded Fund MCHI,
Has achieved 8.2% and the S&P 500 Index SPX,
An increase of 13.9%.