Alibaba Under U.S. National Security Scrutiny as Pentagon Flags Chinese Tech Giants

Alibaba (BABA) has entered a new phase of geopolitical pressure after the Pentagon recommended adding the company—along with Baidu and BYD—to the Section 1260H list, which identifies Chinese firms allegedly linked to the People’s Liberation Army.

This recommendation, issued via a letter from Deputy Defence Secretary Stephen Feinberg to Congress on 7 October 2025, does not impose an outright ban on private investors. However, it carries serious implications:

Key Market Implications
• Reputational damage that may deter institutional U.S. investors
• Restrictions on Pentagon contracts and federal procurement
• Higher perceived risk for pension funds and ETFs
• Increased geopolitical tension, just weeks before the expected Trump–Xi trade truce

China rejected the accusations as “false” and warned of potential countermeasures to defend its companies.

This development adds another layer of uncertainty to U.S.–China tech relations and could weigh on Chinese ADRs in the short term.

Mercosur–EU Trade Deal Moves Forward: A Historic Agreement Nears Final Approval

Argentine President Javier Milei is set to travel to Brazil on 17 December, ahead of the expected signing of the long-awaited Mercosur–European Union Free Trade Agreement on 20 December.

If confirmed, this would create one of the largest free-trade areas in the world, connecting more than 700 million people across South America and Europe.

Economic Impact
• South America → Europe: commodity exports (agriculture, minerals, energy)
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• 🇪🇺 Europe → South America: industrial goods, machinery, pharmaceuticals, and manufactured products
• Reduction of tariffs across key industries
• Improved logistics, supply chain integration, and investment flows

This agreement would significantly reshape global trade dynamics and strengthen economic ties between both blocs after decades of negotiations.

Waymo Expands Autonomous Driving Leadership as Google Looks Beyond 2025

Waymo, Google’s autonomous robotaxi service, continues to gain ground with strong traction in the United States—now capturing 10% of the ridesharing market in San Francisco, competing directly with Uber and Lyft.

How Waymo Works (Key Tech Highlights)
• 👁 Hybrid sensors: cameras + LiDAR lasers + radar scanning up to 500 metres
• AI-driven decision-making: the car accelerates, brakes, changes lanes and navigates entirely on its own
• Familiar user experience: passengers request a ride via app, board the vehicle, and pay digitally
• 🗺 3D mapping: real-time mapping ensures precise detection of vehicles, pedestrians and obstacles

With rapid adoption in major U.S. cities, Waymo is positioning itself as a global leader in AI-powered mobility—setting the stage for international expansion.

MicroStrategy Under Pressure as Bitcoin Exposure Threatens Index Inclusion

MicroStrategy is facing renewed market pressure due to its unusually high exposure to Bitcoin, which remains its primary balance-sheet asset. Any decline in Bitcoin’s price directly affects MicroStrategy’s share price and increases volatility.

Key Risks Identified
• Geopolitical tensions and regulatory concerns affecting global crypto markets
• Ongoing critique that MicroStrategy behaves more like a Bitcoin investment fund than a traditional tech company
• MSCI is considering excluding companies that hold digital assets exceeding 50% of total assets
• A final decision is expected by 15 January

MicroStrategy also risks exclusion from major indexes such as the MSCI USA and Nasdaq 100, which could trigger outflows from institutional investors and passive funds.

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Alphabet’s Co-Founders Become the World’s Second and Third Richest People

Larry Page and Sergey Brin have climbed to the No. 2 and No. 3 positions on the global billionaire rankings, fuelled by Alphabet’s impressive stock market performance.

Alphabet recently surpassed a $4 trillion market capitalisation, driven by rapid advances in artificial intelligence—particularly the development of Gemini and Google’s expanding role in the AI hardware ecosystem.

Why Their Wealth Surged
• Alphabet shares have rallied more than 75% since August
• Additional gains of 2%–6% in recent sessions added tens of billions to their net worth
• Growing investor confidence in Google’s AI, cloud, and semiconductor strategy
• Meta’s adoption of Google chips further boosted sentiment

This momentum has pushed Oracle’s Larry Ellison down to the fourth position in global wealth rankings.

Conclusion

This week’s market landscape is marked by geopolitical pressure on Chinese tech, historic trade negotiations, AI-powered mobility expansion, index-level risks linked to cryptocurrencies, and massive wealth shifts at the top of the tech world.

For traders and investors, the key themes remain:
✔ AI dominance
✔ U.S.–China tensions
✔ Global trade realignment
✔ Bitcoin-linked volatility
✔ Tech sector leadership