What will happen to Alibaba shares on Monday?

Alibaba Group Holding Ltd (NYSE:BABA) fell on Monday as China's lackluster economic data led to a sell-off, SCMP reports.

The economy also bears the brunt of US sanctions on advanced semiconductors, as it is denied access to sophisticated artificial intelligence chips from Nvidia Corp (NASDAQ:NVDA) and colleagues.

Hyperscalers like Alibaba and Baidu, Inc (NASDAQ:BIDU) needs the chips to realize its AI ambitions. AI can prove to be a crucial benefactor for its e-commerce, logistics and cloud businesses, something that Amazon.Com Inc (NASDAQ:AMZN).

Read also: Alibaba and Tencent use Meta's AI large language model

Last week, the Biden administration announced an increase in tariffs on Chinese imports effective September 27, including Chinese electric vehicles, solar panels, steel, aluminum, EV batteries and critical minerals.

Economic data showed that China's industrial production, retail sales and fixed asset investment all disappointed in August, while property prices hit a nine-year record low.

Barclays drew the SCMP's attention to the urgency of accelerating monetary easing and stimulating domestic demand.

The People's Bank of China (PBOC) told SCMP it may cut banks' reserve requirement ratio (RRR) by 50 basis points, followed by a further half-percentage point cut in the first half of next year.

Alibaba shares have fallen nearly 3% over the past 12 months.

Alibaba stock forecast for 2030

Predicting future stock prices over long periods of time is challenging. Wall Street analysts use complex models that take into account interest rates, economic growth, competitive advantages, management teams and historical profitability, among a variety of other factors.

If you as an investor want to assume that most of the important factors remain stable, you can use trend analysis as a useful tool. Using a longer-term trend line or the historical performance of a stock, you can try to predict the annual return of a stock.

Alibaba's annualized stock performance over the past five years is -13.4%, and assuming this trend continues over the next five years, one can expect a stock price of $40.81.

Using a trendline (here's how to do this function). If you decide to use a trendline, connect your two points and look into the future to the point in time you're interested in. Once you've determined the stock price, consider what conditions the stock needs to experience to justify the stock price – whether it's an outside influence or a management decision.

Price promotion: BABA shares fell 1.04% to $83.81 at last check on Monday.

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This article, “What's happening with Alibaba stock on Monday?” originally appeared on Benzinga.com

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