Mainland Chinese investors have shown substantial interest in Alibaba Group Holding Ltd. following the introduction of its Hong Kong-listed stock to them for the first time. On the inaugural day of trading through the Stock Connect program, investors acquired HK$8.5 billion ($1.1 billion) worth of Alibaba shares on a net basis, according to stock exchange data released late Tuesday. Transactions through the Shanghai and Shenzhen stock exchanges represented approximately 50% of the day’s turnover for the stock.
Positive Market Impact
The influx of investment led to a notable increase in Alibaba’s share price, which closed 4.2% higher in Hong Kong, making it one of the best performers on the Hang Seng Index for the day. However, the stock showed minimal movement in early trading on Wednesday.
Outlook and Future Projections
The positive trend is anticipated to persist in the near term. Bloomberg Intelligence projects that fund inflows from China into Alibaba could reach $20 billion over the coming year. This influx would result in mainland investors holding approximately a 10% stake in the company.
Conclusion
The strong debut of Alibaba’s Hong Kong-listed shares via the Stock Connect program reflects growing confidence from mainland Chinese investors. With significant capital inflows expected, Alibaba is poised to benefit from increased investment and market attention in the coming months.
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