Alibaba Stock: Caught Between Politics and AI

Alibaba is navigating a complex landscape of regulatory hurdles and market pressures as it seeks to strengthen its AI and cloud services. The company’s stock currently trades at €128.00, caught between oversold conditions and the looming threat of US trade restrictions.

At the heart of its strategy lies the acquisition of Nvidia’s advanced H200 chips—a move critical for staying competitive in AI. Yet, uncertainty over US export rules and Chinese import approvals continues to weigh on investor confidence.

Alibaba’s push to secure Nvidia’s H200 chips marks a key step in expanding its AI capabilities. The US recently approved the export of these high-performance chips, but the deal still requires formal import clearance from Beijing. Without this approval, the company’s plans to upgrade its cloud infrastructure could face delays.

Regulatory risks have further complicated the picture. Discussions about adding Alibaba to the US Entity List—a blacklist restricting certain US investments—have dampened market sentiment. The stock has dipped below its 50-day moving average, though it remains above the 200-day line, reflecting a fragile recovery since early 2025. Investor activity has been mixed. While most institutions held back from new positions in the third quarter, Harbour Capital Advisors LLC acquired around 6,900 shares worth approximately $1.25 million. This move stands out amid broader caution, as traders await clarity on US-China trade policies. The next critical milestone will be regulatory decisions on export approvals and Chinese import licenses. These rulings will likely determine whether Alibaba can fully integrate the H200 chips into its operations—or face further setbacks in its AI ambitions.

Alibaba’s near-term outlook hinges on two key factors: securing the H200 chips and avoiding inclusion on the US Entity List. The stock’s technical position suggests short-term weakness, but its long-term trajectory will depend on regulatory outcomes.

For now, investors are watching closely as Beijing and Washington finalise their decisions—developments that could either accelerate Alibaba’s AI growth or impose fresh constraints.