Alibaba’s ADRs surged 11% to $109.38 in premarket trading on Wednesday, marking the stock’s biggest single-day move in Hong Kong since September.
Alibaba Group Holding Limited, BABA
The catalyst was a pre-earnings analyst briefing. According to local outlet Jiemian News, Alibaba told analysts that losses in its fast-growing instant-commerce business narrowed over the June quarter, while overall profitability held steady. Investors liked what they heard.
The Hong Kong-listed stock climbed 12.5% at its peak, putting it among the top gainers on the Hang Seng Tech Index, which rose around 5%.
The move wasn’t just an Alibaba story. JD.com added 3.8%, Baidu rose 6.4%, and Tencent gained nearly 4%. Chinese megacaps, which had been left behind for much of 2026, suddenly had investors’ attention again.
The broader picture here is a shift in money flows. For months, the AI trade ran through chipmakers — particularly South Korean names like SK Hynix and U.S. firm Micron. Those stocks powered strong gains in Korea’s KOSPI index and Taiwan’s markets.
Wednesday flipped that script. The KOSPI fell as much as 5.4% as capital moved away from semiconductor-heavy markets. Micron dropped 4.7%, SK Hynix fell 5.7%.
Investors appear to be looking for cheaper entry points into the AI theme. Chinese internet companies, which had fallen to bear market territory in Hong Kong, offer lower valuations compared to stretched U.S. and Korean counterparts.
Adding to the bullish mood around Chinese AI: Reuters reported that DeepSeek is developing its own chip to power AI systems. The Information also reported that Zhipu is considering designing its own AI chip — signs that China’s AI ecosystem is moving up the hardware stack.
While Chinese tech caught a bid, U.S. markets were pointing lower. Nasdaq 100 futures slipped 1.1% after President Trump signaled the cease-fire between the U.S. and Iran may be breaking down. Rising oil prices spooked investors across the board.
Alibaba’s own ADRs had been under pressure in 2026, falling 33% year-to-date before Wednesday’s move. The drag came from investor concerns about the company’s aggressive spending on AI infrastructure, including its Qwen large-language model, which it has positioned as a rival to ChatGPT.
The Barron’s note from Monday argued Chinese AI companies are well-placed to compete, pointing to the relatively low cost of their chatbot offerings compared to those from OpenAI, Anthropic, and Alphabet.
Alibaba reports full earnings in the coming days. Wednesday’s pre-briefing suggested the numbers, at least on the profitability side, may not be as bad as feared.
The Hang Seng Tech Index had entered bear market territory earlier this year on fading confidence in Chinese e-commerce and concerns about China’s broader economy.
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