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Hong Kong stock market
BusinessChina Business

Hang Seng Index slides below 17,000 mark as stocks pummelled on China slowdown concerns, flare-up in Covid cases

  • The People’s Daily says zero-Covid is crucial to economy, lives after a recent flare-up in domestic cases
  • Alibaba, Meituan, Longfor, Country Garden led losses as the Hang Seng Index slipped through another psychological floor

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Reflection of stock prices on a skyscraper in Hong Kong. Photo: Shutterstock
Zhang Shidongin Shanghai
Hong Kong stocks fell for a fourth day, dragging the benchmark index below the 17,000 mark for the first time in 11 years. Concerns about China’s economic slowdown deepened as Beijing squashed hopes for an imminent reversal of its zero-Covid policy.

The Hang Seng Index retreated 2.2 per cent to 16,832.36 at the close of Tuesday trading, bringing the cumulative four-day slide to 6.9 per cent. The Tech Index weakened 3.6 per cent, while the Shanghai Composite Index climbed 0.2 per cent. Stocks in Japan, South Korea and Taiwan sank.

Alibaba Group tumbled 3.4 per cent to HK$76 and Meituan sank 6.1 per cent to HK$151.40. Developer Longfor Group lost 8.5 per cent to HK$20 and Country Garden slumped 9 per cent to HK$1.61. Carmaker Geely Auto and peer BYD lost at least 0.4 per cent.

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The zero-Covid policy is sustainable and the country must stick to the regime, which is key to economic stability and protection of lives, the People’s Daily, the Communist Party’s mouthpiece, said in a commentary on Tuesday. The editorial came as the nation logged almost 2,000 new coronavirus infections on Monday and the party assembles for its national congress this weekend.
“Hong Kong stocks will continue to be in the doldrums, given the Covid resurgence and policy tightening overseas,” said Zhang Yidong, a strategist at Industrial Securities in Shanghai. “The flare-up in the pandemic and a slumping property market will make it harder for the economy to rebound this time.”
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Shanghai has doubled down on Covid tightening measures, requiring all arrivals to take three nucleic acid tests within three days, as China’s biggest commercial city with about 25 million residents reported one new infection outside quarantine on Monday.

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