Business & Economy

Alibaba shares suffer scare over false Jack Ma arrest confusion

Shanghai, China, May 3 (EFE).- The shares of Chinese e-commerce giant Alibaba suffered a significant drop in the first minutes of the session in Hong Kong due to the confusion over the alleged arrest of founder Jack Ma, an incident later dispelled by the country’s official press.

At about 09:45 local time (01:45 GMT), just 15 minutes after the start of the trading day, Alibaba shares plummeted 9.4 percent.

Forty five minutes earlier, state television channel CCTV announced “coercive actions” in the eastern city of Hangzhou – hometown of Jack Ma and headquarters of Alibaba – against a man named Ma. He was accused of “colluding with hostile anti-Chinese forces abroad” and engaging in “activities that endanger national security such as inciting secession or subverting state power.”

The announcement did not specify the first name of the person under investigation, apparently sparking a panic among investors fearing it was Jack Ma, whose relationship with national authorities soured in late 2020 with the thwarted IPO of the technofinancial Ant Group.

The official press was quick to deny rumors. The Global Times newspaper said the detainee’s name consists of three Chinese characters, while that of Jack Ma (Ma Yun) only has two.

According to that newspaper, the person investigated works as director of research and development of hardware in a computer company.

After the denial, the price of Alibaba’s shares in Hong Kong recovered, limiting its losses to 1.57 percent at the mid-session break.

Investors’s spirits in Chinese technology companies are at a sensitive moment. The information that pointed to the possible end of the harsh campaign to regulate the sector by the Chinese government caused Alibaba shares to rise 15.69 percent in value Friday

Despite this, the group’s shares in Hong Kong continue to trade at practically half the price at which they debuted on that floor at the end of 2019.

Alibaba has been marking this downward trend since the aforementioned clashes between Ma and authorities on account of Ant Group’s IPO at the end of 2020.

The company has been one of the most affected by the regulatory campaign, in the framework of which Beijing imposed, in April 2021, the largest antitrust fine in China’s history, equivalent to some $ 2.8 billion. EFE


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