Why Alibaba (BABA) Shares Are Trading Higher Premarket Today - Alibaba Gr Hldgs (NYSE:BABA), TENCENT HLDG

Shares in Chinese tech giants Alibaba Group Holding Limited (NYSE:BABA) and Tencent Holding Ltd (OTC:TCEHY), along with the chipmakers, slumped as the U.S. slapped export control measures aimed at slowing Beijing's technological and military advances, Reuters reported.
The U.S. introduced a sweeping set of export controls, including a measure to cut China off from certain semiconductors made anywhere in the world with U.S. equipment.
The new controls coincided with the global chip industry battling significant headwinds from tumbling demand post-COVID in computers, smartphones, and other electronic devices.
U.S. companies must cease supplying Chinese chipmakers with equipment that can produce relatively advanced chips - logic chips under 16 nm, DRAM chips below 18 nm, and NAND chips with 28 layers or more unless they first obtain a license.
Analysts expect the impact on leading contract chipmaker Taiwan Semiconductor Manufacturing Company Ltd (NYSE:TSM) thanks to its U.S.-based customers such as Apple Inc (NASDAQ:AAPL) and Qualcomm Inc (NASDAQ:QCOM). However, it generates around 10-12% of its revenue from China.
Analysts said the new regulations would pose significant hurdles for the two Chinese memory chipmakers, Yangtze Memory Technologies Co Ltd and Changxin Memory Technologies.
Price Action: BABA shares traded lower by 1.44% at $80.07 in the premarket on the last check Monday.
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