Following a report by Chinese state media that a man with the “Ma” surname had been taken into custody, Alibaba shares plunged on Tuesday, sweeping across the tech industry.
Following the publication, the shares of the Chinese e-commerce giant fell by up to 9.4% at the open in Hong Kong, and finally corrected to close approximately 1% lower. The correction was influenced by state television station CCTV of China which clarified that the arrested was not the billionaire founder of Alibaba, Jack Ma. Α Chinese state-run nationalist tabloid, The Global Times, said the suspect worked for an IT company and had set up an online group seeking to “split the country and overthrow the state”.
However, the original CCTV report said, authorities at Alibaba headquarters in Hangzhou suspected a “Ma” of using the Internet to endanger traders in Hong Kong who were about to buy Chinese tech stocks after a pledge. Senior officials said at the end of last week that the easing of restrictive measures imposed on the industry is imminent.
“China has imposed draconian measures on technology companies and now everyone is on alert – if something happens they will immediately sell out shares,” said Luis Che, chief executive of Hong Kong-based Wealthy Securities.
Alibaba shares have fallen 54% since the end of June, losing more than $ 340 billion in stock.
Source - database | Page ID - 837