Hong Kong stocks dive as lockdown fears bite

Shares in Hong Kong and the mainland plunged on Monday on growing fears over the Chinese economy as a fast-spreading Covid outbreak forces lockdowns in major cities, while traders were also worried about an expected sharp hike in US interest rates.

The Hang Seng Index plunged 3.7 percent, or 769 points, to 19,869.

Dickie Wong, head of research at Kingston Securities, said the weak Hong Kong dollar hadn’t helped sentiment among local investors.

But he said that he believes the market is close to the bottom, with most negative factors already priced in.

“I strongly believe the Hang Seng Index may find good support at 19,000 points and the current valuation is extremely low,” Wong told RTHK.

“So I would hope that the pandemic situation if it’s getting better or there are any signs of recovery in the mainland, it will probably give a boost to the stock market in early May.”

The Shanghai Composite Index shed 5.1 percent, or 158 points, to 2,928, while the Shenzhen Composite Index dived 6.5 percent, or 124 points, to 1,790. (Additional reporting from AFP)