Alibaba Group Holding Ltd (NYSE:BABA) shares were down on the second day as Chinese tickers trading on U.S. were down following a report that suggested a slowdown in the world’s second-largest economy, says a report from Bloomberg. Alibaba stocks lost 3% to $87.17 in New York yesterday offsetting some of the gains made after last week’s initial public offering.Alibaba Group Holding Ltd (BABA) Down On China Growth Concern

Alibaba depends on consumer spending

Bloomberg index comprising of the most actively traded Chinese companies in the U.S. lost 0.1% and was down to a month low.  Software developer Cheetah Mobile was the biggest loser with a decline of 14%. The decline in the Chinese stocks followed a report from the country’s Beige Book, which indicated that the economy is in ‘low gear’ owing to the lackluster performance of the retail and residential real-estate industries.

One of the analysts told Bloomberg, “Alibaba’s performance is leveraged to consumer spending,” and added “As the government folds back the stimulus, consumer spending might take a hit.”

Beijing based Cheetah Mobile was down to $20.23, it’s lowest in seven weeks. Also, JD.com Inc. (China’s second-largest e-commerce operator after Alibaba) was down for the third day, losing 1.5% to its two-month low. Mobile-security firm, NQ Mobile Inc. gained 13%. Previously, short seller Carson Block accused NQ Mobile of overstating revenue.

Yahoo down since Alibaba’s IPO

Alibaba, which earns almost 90% of its revenue from China, gained 38% on its debut (biggest gain for a new stock offering). The first-day gain helped it to make a place among the most valuable companies on the U.S. exchanges, as per the data compiled by Bloomberg.

Last week, the Hangzhou-based company raised $21.8 billion before the use of greenshoe option by the underwriters to increase the size of the IPO by 15%. The increase in the IPO size helped Alibaba to overtake the previous IPO record of $22.1 billion by Agricultural Bank of China Ltd., in 2010.

It is interesting to note that Yahoo! Inc. (NASDAQ:YHOO) shares are down around 9% since the Alibaba IPO. It seems that Yahoo’s 22% stake in the Chinese firm was the only reason that made investors interested in the U.S. tech firm. On Monday, Yahoo shares were down 5.57% while they were up 1% on Tuesday.