Highlights from the last week of China business news.
Is Ballmer giving Ma an ulcer?
Alibaba’s chief Jack Ma must be following the Microsoft/Yahoo takeover saga with a bottle of Pepto-Bismol in hand. Shares in Hong Kong-listed internet firm Alibaba.com fell 6% on Monday to HK$15.25 following news that Microsoft had bailed on a takeover bid for Yahoo. Yahoo owns 39% of Alibaba Group, Alibaba.com’s parent company. While some speculated that the decline in share price was caused by the abandoned takeover bid, analysts suggested the drop was due to profit-taking just ahead of the firm’s quarterly earnings report. As it turned out, Alibaba.com’s first quarter net profit more than doubled year-on-year to US$43 million from US$20 million. Revenues from the firm’s China Marketplace platform increased by 81% year-on-year to US$31 million. The stock closed at HK$15.40 on Tuesday, erasing Monday’s decline. Microsoft, meanwhile, is doubling down in China, at least from an R&D perspective. The firm broke ground on a US$280 million R&D center in Beijing and intends to double its full-time R&D staff in China to 3,000 over the next few years.
Almost quiet on the eastern front
Relations with a certain eastern neighbor of China’s appeared to enter a new stage of symbolic good cheer with Hu Jintao’s visit there, the first by a Chinese president in over a decade. Hu intended to honor the time-honored Chinese-official-visit tradition of playing ping pong and talking about pandas. Along the way, there were discussions about a certain disputed area in the East China Sea that may or may not have gas reserves. While these major disputes have yet to be ironed out, China and Japan have pledged to hold annual meetings and put past suspicions behind them. The western front, however, might need some more tending to. Having achieved no concrete progress on easing tensions following the riots in Tibet at their first meeting in Shenzhen, Chinese and Dalai Lama representatives agreed to meet again at an undetermined time. Just south of the autonomous region, India’s defense ministry announced that it had successfully tested a nuclear-capable missile that had the ability to hit Shanghai and other major Chinese cities.
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