Hong Kong stocks fell to near a four-week low on concerns an extended lockdown in Shanghai and other mainland cities will hit manufacturing and derail economic growth while policymakers held back policy stimulus. The Hang Seng Index slumped 3 per cent to 21,208.30 at the close, set for the lowest level since March 16. The Hang Seng Tech Index sank 5.2 per cent while the Shanghai Composite Index weakened 2.6 per cent. Among the Hang Seng Index’s worst performers, Alibaba Group Holding lost 5.1 per cent to HK$98.50 and Tencent Holdings retreated 4.3 per cent to HK$353.60. Haidilao sank 9.6 per cent to HK$12.76 and Country Garden Services tumbled 9.1 per cent to HK$36.45. China is struggling to contain the most severe Covid-19 outbreak in two years, with Beijing sticking to its zero-tolerance policy. Daily confirmed cases in Shanghai surged above 25,000 on Sunday, a record since the March 28 citywide lockdown. New infections have also emerged in Guangzhou, leading to a partial lockdown in the capital of southern Guangdong province. ‘China put’ in play as foreign funds buy Moutai, China Tourism stocks amid calls for stimulus “It’s illogical to be long on st ocks now and an upward trend on the market is unlikely,” said Yan Kaiwen, an analyst at Huaxin Securities. “There’s still a chance that stocks will test a new low.” The stringent containment measures are hurting industries. Nio, the Shanghai-based maker of electric vehicles, halted production because of a parts shortage. Factories at Contemporary Amperex Technology (CATL), which supplies EV battery packs to Tesla, were also affected, Shanghai Securities News reported. Goldman Sachs, which tracks the impact of Covid-19 curbs on real economic activity through its Effective Lockdown Index, sees a 3.25 per cent hit to global GDP as of the first week of April, though well below a peak of 20 per cent about two years ago. China’s reading remained high, it added. Government reports on Monday showed inflation accelerated faster than expected last month, limiting room for policy loosening. Consumer prices rose 1.5 per cent and factory-gate prices jumped 8.3 per cent. Both exceeded consensus estimates of economists tracked by Bloomberg. In mainland China, CATL sank 7.3 per cent to 459 yuan, its steepest decline since March 7. Jiangsu Haili Wind Power Equipment Technology dropped 4.7 per cent to 79.04 yuan on its first day of trading in Shenzhen. Other major markets in Asia all fell, as rising US Treasury yields raised fear of more aggressive policy tightening and looming recession.