After a valiant effort to hold $85, Alibaba (BABA) stock collapsed to below $80, at $79.94. Other Chinese tech firms fared worse. JD.com lost 10% in the last week while search engine and AI play Baidu (BIDU) lost 15%.
The sell-off intensified because China was unable to respond effectively to U.S. trade and chip restrictions. The best the CCP could do was unveil a global AI governance initiative. The core measure is upholding principles of mutual respect, equality, and mutual benefit in AI development. It opposes drawing ideological lines or forming exclusive groups that hinder other countries from AI development.
The U.S. and the world need not take the initiative seriously. China’s tech industry is struggling because it cannot access U.S. technology. It will need to spend billions just to catch up slightly.
Buy China Stocks Later
11.11, or singles day, approaches in less than a month. Every year, consumers spend on discounted goods and deals. Although this could offset JD and Alibaba’s struggles, Chinese consumers are not in a spending mood. During the week-long holiday, consumers limited their spending. They feel less wealthy as real estate, their biggest asset, lost at least 15% in value.
Watch Chinese tech stocks. They could rebound.
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