Alibaba, JD.com sink with Hong Kong stocks as China Covid lockdowns spark protests, hit large chunk of economic capacity

Hong Kong stocks slumped by the most in five weeks on concerns China will crack down on protests against Covid-19 lockdowns as pockets of unrest spread in mainland cities including Beijing and Shanghai.

The Hang Seng Index sank 4 per cent to 16,868.98 as of 9.47am local time, heading for the biggest sell-off since October 24. The Hang Seng Tech Index slid 4.4 per cent and the Shanghai Composite Index retreated 2.1 per cent.

Alibaba Group Holding tumbled 6 per cent to HK$70.35 and Tencent Holdings dropped 3.2 per cent to HK$264.20 while JD.com crashed 7.6 per cent to HK$183.60. Macau casino stocks dropped even after the six existing operators won new 1o-year concessions. Galaxy Entertainment led losers with a 2 per cent decline to HK$42.

China reported 40,052 daily new cases on Sunday, topping 40,000 for the first time, according to the health ministry. Protests against strict lockdowns erupted. As cases surged, cities with high-risk districts now accounted for some 65 per cent of national output, Goldman Sachs estimated.

“The central government may soon need to choose between more lockdowns and more Covid outbreaks,” the US bank said in a report on Sunday. The bank’s 30 per cent odds of reopening before the second quarter of next year “includes some chance of a forced and disorderly exit,” it added.