Alibaba Sinks 4% In Hong Kong After US-Listed ADRs Plunge 10% As Trump Limits Foreign Investments In Chinese Tech

Shares of Alibaba Group Holding Ltd ADR BABA declined on Monday and the Chinese technology giant's Hong Kong-listed shares continued to fall on Tuesday triggered by President Donald Trump's remarks to limit Chinese spending and investment.

What Happened: Jack Ma’s BABA which has gained 51.90% on a year-to-date basis and its HK counterpart 9988 which was up 60.39% during the same period fell after Trump's memo directed the Committee on Foreign Investment to take action.

The committee is a secretive panel that reviews foreign investments in companies or property for potential national security risks.

As reported by Bloomberg, the panel was asked by the President to curb Chinese spending on technology and other strategic U.S. sectors. Furthermore, to counter China’s dominance in shipbuilding, the U.S. proposed fees for the use of Chinese-made commercial ships.

Why It Matters: Alibaba's U.S.-listed American depository receipts have rallied 43.39% since the Jan. 25 weekend, when DeepSeek topped Apple Inc.’s APP App Store charts and Nvidia Corp. NVDA fell 17%.

However, BABA sank 10.23% to $129.04 apiece on Monday and 9988 was trading 4.05% lower as of the publication of this article.

Meanwhile, Benzinga Pro data indicated that the stock was still above its eight-day and 20-day average in the short term. Additionally, it was above the longer-term 50-day and 200-day averages displaying bullish trends.

Momentum indicators were also strong. The relative strength index fell below the overbought to neutral zone at 66.86 while it still had a positive MACD of 11.65, indicating the possibility of a further positive move.

Benzinga tracks 21 analysts with an average price target of $135.1 for the stock, reflecting a “buy” rating. Estimates range widely from $85 to $190. Recent ratings from Morgan Stanley, Benchmark, and JP Morgan average $180, suggesting a potential 40.31% upside.