Last month, Alibaba, the Chinese Internet conglomerate, made history with its initial public offering on the New York Stock Exchange. Stock commenced trading on Sept. 19 at a price of $68 a share, running up soon after to $93.89 a share, a 38 percent gain, where it closed.
At day's end, the company's market capitalization had reached $231.4 billion, a valuation that exceeded such giants as Intel and Pfizer. The IPO has reportedly made Jack Ma, Alibaba's founder and chairman, China's richest man by virtue of his holding of $25 billion in shares. The Alibaba IPO also says a lot about China and U.S. stock markets, and most, but not all, of it is good.
Alibaba's share price is a vote of confidence in the company and in China. At a time of great uncertainty in the Chinese market — amid ripples from Beijing's anticorruption campaign and worries by foreign companies that they may be targeted sooner or later by the Chinese government for intense and sometimes unfair regulatory scrutiny — the soaring valuation suggests that investors believe Alibaba may be too big to fail, or at least too big for Beijing and the Chinese Communist Party to mess with.