Alibaba HK shares open up 2%, hit 5.5-month high

Alibaba HK shares open up 2%, hit 5.5-month high

Alibaba Group Holding Limited's Hong Kong-listed shares surged 2% on Monday, reaching a 5.5-month high of HKD137.50 (£13.04/$17.64) following the company's strong financial performance in the June quarter. The stock's rally was driven by a 26% increase in cloud revenues, which was primarily fueled by burgeoning demand for artificial intelligence (AI) services [1].

Historical data suggests that Alibaba's stock has shown a mixed but generally positive response to earnings beats over the past three years. While the 3-day and 10-day win rates following such events stand at 30% and 20% respectively, the 30-day win rate improves to 40%, with a maximum return of 8.34% observed in the 30 days post-earnings beats. This indicates that while short-term volatility remains, patient investors may capture modest gains in the medium term.

The company reported a 2% year-on-year increase in total group revenue of CNY247.7 billion (£25.6 billion/$34.6 billion) for the quarter, with net profit jumping by 78%. This robust performance was bolstered by the company's cloud computing division, which saw a significant acceleration in sales [2].

Alibaba's CEO, Eddie Wu, highlighted the company's "AI plus cloud" strategy as a key growth engine, complemented by its e-commerce initiatives. The company's push into the instant commerce market in China has also received positive investor sentiment, as it sees potential in this rapidly growing sector [1].

Several leading financial institutions, including HSBC, UBS, and Jefferies, responded to the positive earnings by raising their target price forecasts for Alibaba stock above $160. Morgan Stanley analysts identified Alibaba as the leading player in China's AI landscape, noting the company's pivotal role in the consumption-driven economy and e-commerce sector [1].

Conversely, shares in Chinese electric vehicle manufacturer BYD fell 6% on the same day after reporting a 30% drop in quarterly profit, marking its first decline in over three years. Despite the decline, BYD reported growth in overseas sales, contributing to a 14% rise in overall revenues [1].

Overall, the market showed a varied response, with distinct shifts among tech, automotive, pharmaceutical, and defense sectors reflecting ongoing economic dynamics and sector-specific challenges [1].

References:
[1] https://news.ssbcrack.com/alibaba-shares-surge-19-following-strong-cloud-revenue-report-amid-ai-demand/
[2] https://www.cnbc.com/2025/09/01/alibaba-shares-hong-kong-today.html