Will Alibaba break the HK$ peg?

"Probably not" is the answer, but it's remarkable that the question is being asked. The Wall Street Journal is measured in its coverage of how the Hong Kong Monetary Authority just purchased US$100 million to steady pressure on the peg, set at HK$7.80 = US$1 since 1983. The article notes:

The Hong Kong dollar has been bolstered by strong demand for local stocks, including the coming initial public offering from Alibaba.com Corp., which could raise US$1.49 billion in the biggest IPO of a Chinese Internet company.

The South China Morning Post noted " Hot demand for Alibaba.com's shares helped push the Hong Kong dollar to a three-year high yesterday" while the Standard commented "An expansion of the qualified domestic institutional investors program whereby mainland investors can buy Hong Kong stocks and the upcoming debut of mainland e-commerce portal Alibaba.com fueled heavy demand for the local currency".

Meanwhile, Global Sources continues to benefit from the Ali-halo effect with its shares now trading at over US$35 on NASDAQ, double where they were on 17th September ($17.62).