3 Catalysts That Could Add To Alibaba's Stock Rally

Alibaba Group Holding Limited BABA shares bottomed out in early October and have been grinding higher in recent sessions.

Alibaba Reverses Course: Alibaba shares came under pressure in late 2020 as Chinese regulators began cornering the company from all sides in order to curb its dominant market positioning.

From an all-time high of $319.32 on Oct. 19, 2020, the shares began to slide and were on a broader downtrend. The stock hit a bottom on Oct. 4, when it dropped to an intraday low of $138.43.

Since then, the stock has risen through several resistance levels and is approaching the $180 level.

Ahead of the company's September quarter results, fears were expressed concerning a slowdown in the company's e-commerce revenues, given the slowdown in retail sales and consumer sentiment in China. Notwithstanding the macroeconomic softness, the stock could get some support from three catalysts.

Worst Of Alibaba's Regulatory Woes May Be Over: After a tougher clampdown on tech companies that further widened to include other sectors as well, it now appears regulators in China may have achieved their goals.

Significant progress is expected to be achieved in the ongoing crackdown on fintech firms before the year's end, Bloomberg reported, citing China's top financial regulator.

Related Link: What To Expect When Alibaba Reports Its Q2 Results

Reappearance Of Founder Jack Ma: After being mostly out of public view since the regulatory crackdown began, Alibaba's co-founder Jack Ma was allowed to fly abroad this week. Ma is in Spain for an agriculture and technology study tour related to environmental issues. Although

Ma retired as the company's chairman in 2019, he is still an influential figure who wields a lot of clout. The Spain trip is viewed positively, as it suggests his actions and movements are no longer restrained. This could work in Alibaba's favor. 

Strong Start To Singles Day Season: Alibaba kickstarted its all-important Singles Day shopping festival earlier this week.

A top livestream salesman going by the name Li Jiaqi sold about $1.9 billion worth of goods on the first day of the annual shopping extravaganza, Bloomberg reported. Li's sales are a record for any show livestreamed on Alibaba's Taobao online marketplace, the report said, citing Taosj.com data.

Livestreaming of Li's show Wednesday lasted a marathon 12 hours, the first day of China's more than three-week "Singles' Day" shopping binge, the report said. This point toward a potential pick up in sales in the December quarter following what is widely expected to be a soft September quarter.

BABA Price Action: Alibaba shares were gaining 1.6% to $180.26 Friday morning. 

Related Link: Alibaba Opens Up Walled Garden To Allow Rival Tencent's Payment System In Some Apps

Alibaba co-founder Jack Ma. Benzinga file photo by Dustin Blitchok.