Shares of Alibaba dropped sharply following a media report that led investors to believe Chinese authorities had taken action against company founder Jack Ma today.
The company’s share price fell by more than 9%, before a clarification was issued that the report was about a different individual with a similar name and not the billionaire businessman. The losses were recouped once the misunderstanding had been cleared up.
The confusion came over two different Chinese names that would both be spelled “Ma” in English, but have different spellings in the Chinese alphabet. State broadcaster CCTV had initially reported that authorities had taken action against a man with the same name as the Alibaba founder in the city of Hangzhou, which is also where the company is headquartered and led people to assume he was the subject of the article.
The article was later updated to make clear that the individual in question had a similar-sounding but differently-spelled name, and that there was no connection to Alibaba.
Alibaba stock dropped as much as 9.4% in early trading one the back of the misunderstanding, before recovering most of its losses through the day and closing less than a percentage point down.
Shares of Alibaba have come under pressure as regulators crack down on the sector, with the company’s share price dropping more than 50% over the course of the past year. Ma is speculated to have been specifically targeted by regulators following 2020 comments in which is was critical of decisions taken by the ruling Communist Party.