Alibaba Soars on Report of Central Bank Approval for Ant Group
June 21, 2022
Trending News ☀️
Alibaba Group Holding Ltd. ($NYSE:BABA) rose almost 10% in premarket trading on Wednesday after Reuters reported that China’s central bank had accepted Ant Group Co.’s application to set up a financial holding company. According to the report, the People’s Bank of China (PBOC) accepted Ant’s application this month. The move would allow Ant to operate under a regulatory regime similar to that of banks, and would subject it to stricter capital requirements and oversight. The news is a positive development for Alibaba, which has been facing increased scrutiny from regulators in recent months. In November, Ant was forced to shelve its highly anticipated initial public offering (IPO) after the PBOC expressed concerns about the company’s business model and governance. It is not yet clear how the new regulatory regime will affect Alibaba’s business or earnings. However, it is likely that the company will be subject to greater scrutiny and compliance costs going forward.
Market Reaction
The current news is mostly mixed, with some positive and some negative reports. On Friday, Alibaba’s stock opened at $112.5 and closed at $102.2, up by 0.8% from the previous day’s closing price of $101.4.
VI Analysis
Based on the company’s fundamentals, VI app reflects that it has potential long term. However, there are some risks associated with investing in the company. Based on the VI Risk Rating, Alibaba is a medium risk investment in terms of financial and business aspects. You can check out what are the business and financial areas presenting potential risks in our website.
Summary
($NYSE:BABA) stock surged on Thursday after a report said that China’s central bank has given the green light to Ant Group’s initial public offering (IPO). This is good news for Alibaba, as it means that its financial subsidiary will be able to move forward with its much-anticipated IPO. This would be a positive development for Alibaba, as it would provide a boost to its share price. Investors should keep an eye on Alibaba stock over the next few days as the news develops.
