Alibaba, the Chinese tech giant, has pulled in record sales figures. Yet not all is rosy for the firm.
In previous years “Singles Day”—a Chinese Black Friday—has been measured in 24-hour frames. But the e-commerce platform spread its sales across several days this year, possibly to gain ground on the COVID-19 pandemic’s economic rampage, bringing in a total $75.1 billion by Wednesday (Nov 11) – around 583,000 orders per second.
But amid the frenzy, bad news for Chinese tech firms has arrived in the form of regulations issued by Beijing, in an attempt to rein in the power of its biggest brands. On Tuesday November 10 the country’s regulator said it would issue draft rules to end “monopolistic behavior.”
The move follows a suspension of Ant Group’s (formerly AliPay) scheduled IPO, which was set to become the world’s biggest listing, at around $34.5bn. It could knock the company’s value by as much as $150bn.
Beijing’s interference in the market has provoked derision from some experts. “You don’t yank a $35 billion IPO two days before it’s going to be launched internationally, it makes the regulatory system look completely arbitrary and also confused,” Orient Capital Research MD Andrew Collier told CNBC.
But the rule has carved a huge hole in many stock values. Alibaba dropped 9.8% in Hong Kong, while Tencent fell 7.4% and phonemaker Xiaomi 8.2%.