Alibaba Group Holding fell on Monday amid growing concerns that shares could be pulled from US exchanges for failing to meet US disclosure rules.
Shares in the e-commerce giant fell as much as 5.7 percent in Hong Kong to lead a decline in the Hang Seng Tech index, which fell 1.8 percent. The U.S. securities watchdog on Friday added the stock to a growing list of companies facing a pullout because of Beijing’s refusal to allow U.S. officials to review the work of its auditors.
Alibaba shares had briefly rebounded earlier last week amid optimism that the company’s plan to seek a main listing in Hong Kong would allow it to attract more mainland investors. Gains have since faded as traders prepare for the company’s earnings report this week, with analysts predicting the company will post its first ever negative revenue growth quarterly
“Alibaba’s recent application to the HKEX for dual-main listing status and the lack of positive news on the US-China negotiations on the audit issues have likely made the market believe more strongly that Chinese ADRs will inevitably be delisted,” Jefferies analysts wrote. Sunday.
Alibaba said it will seek to maintain its listing status on both the NYSE and HKEX and will comply with applicable laws and regulations, according to a statement to the Hong Kong stock exchange.
The stock is down 27 percent from a peak in July, after rising 70 percent from an all-time low hit in March. Its recovery lost momentum as it was reported that company executives were being questioned by authorities in connection with a data theft case, and the company was fined for failing to properly report previous deals .