Alibaba Group Holding Ltd (NYSE:BABA) downward spiral continues to persist seen by the stock hitting another record low in the market, having hit record highs of $120 a share on holding one of the largest IPO in the U.S. history. Alibaba shares are now trading below the $82 mark for the first time since the company went public, which Fox Business, Nicole Petallides, attributes to the ongoing tussle with authorities in Taiwan as well as allegations over fake orders on its online stores.
Since hitting all-time highs in November, the downward trend has seen the shares sink by nearly 30% with concerns that the trend may persist, longer than expected.
“Alibaba Group Holding Ltd (NYSE:BABA) hit a record all time low today. Concerns about what’s going on with Taiwan asking Alibaba to pull out in six months but Jack Ma CEO, saying that he is fully cooperating with the Taiwanese government,” said Mrs. Petallides.
The Taiwanese debacle is another concern that continues to mount more pressure on a company that is also facing issues of fake orders on its online platforms as well as regulatory scrutiny over dealing in counterfeits. With over 300,000 entrepreneurial clients in Taiwan, CEO, Jack Ma is moving with speed to address the standoff that has seen it being issued with a notice to vacate the country.
The Taiwan’s Investment Commission that oversees incoming business deals is taking issue with Alibaba Group Holding Ltd (NYSE:BABA)’s structure that gives Chinese partners absolute authority in decision making, even though, the company operates in the country. Alibaba on its part could argue the case in Taiwan that it should not be considered Chinese because of its listings in the U.S and its foreign shareholders.
It remains to be seen how far Alibaba Group Holding Ltd (NYSE:BABA) can sink especially on the heels of the upcoming stock expiration period where millions of shares are to be released into the open market. Alibaba Group Holding Ltd (NYSE:BABA) share price in this event could be at the mercy of bulk of shares being sold, something that may push the stock price even lower.
Another big blow for Alibaba Group Holding Ltd (NYSE:BABA) that has accelerated the downward push is big institutional firms and hedge funds dissolving their stakes in the company and providing negative notes to other shareholders.
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