Alibaba slides 9% as regulatory pressure overshadows Singles Day blowout
- Alibaba's blowout Singles Day sales wasn't enough to stem investor concerns of increased regulatory pressure as shares slid as much as 9% on Tuesday.
- The company's extended Singles Day sales event registered more than $56 billion in sales in its first 10 days and 30 minutes of the event, according to the company.
- But pressures remain heightened for the Chinese ecommerce giant, given last week's delayed IPO of Ant Group and as China releases a new draft of anti monopoly rules for online platforms.
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Initial sales for Alibaba's Singles Day event were massive, soaring past $56 billion in the first 10 days and 30 minutes of the extended event, according to the company. But that wasn't enough to stem investor concerns over increasing regulatory pressures building from Beijing on Tuesday.
The news comes just one week after regulators abruptly suspended the highly anticipated IPO of Ant Group, which is partially owned by Alibaba. The debut of Ant Group, which was expected to be the largest IPO in history, is now expected to be delayed up to 6 months at least.
China's State Administration for Market Regulation said on Tuesday that it's seeking feedback on a variety of anti-monopoly rules like offering different prices to different consumers for the same product based on the use of data and algorithms, according to The Journal.
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Other practices that could be targeted by regulators include inflating prices or pricing products below costs, or the use of market influence to restrict sales on competing platforms.
According to the Journal, the new set of regulations from Chinese authorities could be in an effort to ensure the competitive landscape in the online marketplace is fair as the government seeks to encourage domestic consumption over the next five years.
This new set of rules, if implemented, could negatively impact tech behemoths like Alibaba and Tencent and potentially hinder years of uninterrupted growth.
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