Chinese shares, including Alibaba Group Holding Ltd. BABA, Taiwan Semiconductor Manufacturing Company Ltd. TSM and Baidu, Inc. BIDU are falling following Wall Street's worst session of the year, driven by renewed inflation fears and mixed economic data. The decline also comes after a strong rally last week, suggesting profit-taking may be contributing to the sell-off.

What To Know: The broader weakness in U.S.-listed Chinese stocks reflects heightened caution after the Federal Reserve’s latest meeting minutes indicated policymakers remain wary of cutting interest rates without stronger evidence that inflation is under control. Rising geopolitical tensions and trade policy uncertainties, including former President Donald Trump’s announcement of a 25% tariff on imports like autos and semiconductors, have also created headwinds for multinational companies with global supply chain exposure.

Despite Friday’s gains on the back of stronger-than-expected earnings and an upbeat outlook, Alibaba's sharp decline today reflects investor concerns about market volatility and broader economic risks. The company recently reported fiscal third-quarter revenue growth of 8% to $38.38 billion, with adjusted earnings per ADS of $2.93 exceeding analysts' forecasts. Optimism surrounding Alibaba's increased investments in cloud and AI technologies had lifted shares, but today's decline indicates that macroeconomic uncertainties are outweighing company-specific developments.

Investors remain cautious as trade tensions, inflation risks, and the Federal Reserve’s stance on prolonged higher interest rates continue to drive market sentiment, pressuring Chinese equities despite recent positive earnings reports.

Price Action: Alibaba shares were down 9.97% at $129.40, Taiwan Semiconductor shares were down 2.78% at $192.71 and Baidu shares were down 3.94% at $87.68 at the time of writing, according to Benzinga Pro.

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