Why Alibaba Shares Are Sliding Today

Alibaba Group Holding Ltd BABA is trading lower Tuesday morning following a report suggesting the U.S. is examining Alibaba's cloud unit for national security risks. 

The Reuters report cites "three people briefed on the matter."

The review aims to understand how Alibaba stores U.S. clients' data, including personal information and intellectual property, as well as whether the Chinese government could gain access to said information. 

The report suggests that U.S. regulators could ultimately decide to force Alibaba to put measures in place to reduce the risks posed by its cloud business or even potentially prohibit Americans from using the service. 

Alibaba operates China's online marketplaces, including Taobao (consumer-to-consumer) and Tmall (business-to-consumer). 

See Also: Why Alibaba And Other Tech Stocks Are Rising In Hong Kong Today

BABA Price Action: Alibaba has traded as low as $108.70 and as high as $274.29 over a 52-week period.

The stock was down 4.54% at $125.60 at time of publication.

Photo: courtesy of Alibaba.