China’s benchmark stock market sinks to 22-month low on Monday over COVID fears

China’s benchmark stock market sank down by more than two percent to near 3,000 points, the lowest point in about 22 months, as the country’s coronavirus situation continued to drag down market confidence despite multiple weeks of control and prevention measures.

By 11:07 am, the Shanghai Composite Index edged down by 2.4 percent to 3,012.82 points. It once touched the lowest point of 3008.44 points during the morning session.

The Shenzhen Component Index lowered 2.17 percent to 10,813 points. The high-tech ChiNext board edged down by 1.73 percent, while the CSI 300 index was down 1.52 percent.

More than 100 stocks plunged by their trading limit of 10 percent on Monday morning. Coal, aviation and commercial retail stocks led the drop.

China’s stock markets fell as the country continues its battle with coronavirus. On Sunday, the country’s financial hub Shanghai reported 2,472 confirmed local COVID-19 cases and 16,983 asymptomatic cases. Confirmed cases surged compared with the previous day level of 1,401 cases.

Beijing also reported 14 newly confirmed local coronavirus cases and five asymptomatic cases on Sunday. In total, China reported 2,666 confirmed coronavirus cases on Sunday.

Yang Delong, chief economist at Shenzhen-based First Seafront Fund Management Co, said that pressure weighing on the A-share stock markets had not completely disappeared, and that it would take some time for investor confidence to be restored, but the entrance of long-term capital, particularly when many qualified stocks have dropped to attractive levels for investors, should boost market stabilization.

Source: Global Times

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