Analysis |China Stocks Soared due to Alibaba SPLIT
@NJC:
The majority of China stocks ralied in today's trading hour which was led by the news of Alibaba splitting into 6 different companies : Cloud Intelligence Group, TaoBao, Local Services Group, Cainiao, Global Digital Commerce Group and Digital Media & Entertainment. This split in the company caused Alibaba shares to jump by 15% in its US listed shares due to people thinking that by splitting the company, China's regulators will reduce their focus on them. This is because the regulators don't want a company to be too large thereby having too much power in the market, so by splitting the company into 6 parts, investors are pricing in the potential for regulators seeing Alibaba as 6 big companies instead of 1 mega large company, thereby reducing regulations on them. Despite this, Alibaba a