What happened?
shares of Alibaba Group Holding ( BABA -2.66 % ), a leading technology company in China, slipped this morning amid continued investor concerns that strict lockdown measures in Shanghai and across China will hurt economic growth.
Tech stock is down as much as 5.4% this morning and down 2.2% as of 10:50 am ET Monday.
so what
Investors have become increasingly bearish on Chinese stocks of late as the government has implemented a strict zero-COVID policy across China.
Image source: Getty Images.
From March, the lockdowns hit Shanghai, China’s financial hub, and have investors fearing they could hurt China’s economic growth — and with it, big tech companies like Alibaba.
With today’s drop, Alibaba’s share price has plummeted 26% over the past month. Shares have also been on a downtrend over the past year, plummeting 63% over the past 12 months.
What now
China is far from done with its strict COVID lockdowns, and some experts fear they could soon spread to Beijing.
The lockdowns have already slowed the country’s retail sales and industrial production. According to The Wall Street Journal, retail sales fell 3.5% year over year in March and industrial production grew just 5%, compared to 7.5% growth the previous month.
And with no end in sight to the zero-COVID policy, Alibaba investors, and Chinese equity investors in general, should brace for further price declines in the near-term.
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