Alibaba shares rose after listing on mainland Chinese stock exchanges By Investing.com

Alibaba (NYSE: ) shares rose more than 2% in premarket trading on Tuesday as investors reacted to news of its listing on mainland Chinese exchanges.

Alibaba announced its inclusion in Southbound (SB) Connect late Monday.

It comes after the Chinese e-commerce company upgraded its Hong Kong listing to primary status last month, paving the way for it to be added to China’s Shanghai Stock Exchange and Shenzhen Stock Connect Scheme.

The scheme, which integrates BABA into a system linking the Shenzhen and Shanghai stock exchanges with the Hong Kong stock exchange, allows mainland Chinese investors to buy Alibaba shares.

Reacting to the news, analysts at Morgan Stanley said it was in line with their earlier expectations on the timing of SB’s inclusion
(report).

“We estimate net inflows could be $17-37 billion for Alibaba from SB investors over a one-year period, assuming 8%-17% SB ownership,” the investment bank said. “We see short-term incremental positive catalysts on BABA recently, with a major regulatory overhang removed upon completion of a 3-year antitrust rectification, Taobao/Tmall to fully integrate Tenpay, and the launch of software service fees in September.”

The bank adds that this will “potentially narrow the CMR and GMV growth gap in 2H24”.

Even so, they believe the major focus in the market remains on potential intensified industry competition by PDD following Q2 results and weak consumption.

Morgan Stanley is monitoring CMR’s future upward trend as a potential near-term catalyst. The investment bank maintained an Equal Weight rating and a $90 per share price target on the stock.