Alibaba investors should not jump ship despite the latest plunge in the Chinese stock markets and its decelerating economy, Wedbush Securities analyst Gil Luria said Monday.
"One of the important things that have happened in the Chinese economy is that the economy is shifting towards consumption, and that is where Alibaba is positioned," Luria said in a CNBC "Squawk Alley" interview.
"In China, remember, they're not going to be able to build malls fast enough, and so the consumers are going straight to online commerce, and Alibaba has an overwhelming share there."
Luria made his remarks after the Shanghai Composite plummeted 8.48 percent on Monday, a drop that weighed heavily on U.S. and European stocks.
Nevertheless, Alibaba shares were down more than 2 percent on Monday. "Obviously, if the whole world is worried about growth in China, then Chinese stocks are going to get impacted," he said.
"What I'm trying to point out is that the Chinese consumer appears to still be doing fine, which means that this is more of a psychological effect affecting all Chinese stock instead of something Alibaba should be particularly worried about."
DISCLOSURE: Wedbush makes a market in Alibaba's stock.