Alibaba Group’s Hong Kong-listed shares (HK:9988) fell as much as 3.6% during Friday midday trading. The decline positioned the stock as a primary drag on the Hang Seng Index.
The sell-off followed the company's brief appearance on a U.S. Pentagon list of firms allegedly tied to the Chinese military. Although officials reportedly withdrew the list minutes after its release, the mention intensified investor anxiety regarding U.S.-China tensions.
Market pressure increased as Hong Kong investors engaged in catch-up trading following a three-day holiday. This period coincided with a general weakening of global technology shares.
Broader sentiment remains cautious over Alibaba's significant investments in artificial intelligence. Investors express concern that these capital expenditures could compress profit margins, mirroring recent trends among U.S. technology peers.