Global markets fall after lockdown protests in China

Business

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Rarely-seen unrest flared across the country in a critical test of President Xi Jinping’s rule and added to fears for the outlook for the second-largest economy.

China’s stock market posted its biggest one-day plunge in a month and by midmorning, the price of Brent crude was down by more than three per cent, to below $81 a barrel.

Mining giants on the FTSE 100 index were among other areas hit.

Russ Mould, from investment firm AJ Bell, said: “China is a rapacious consumer of global commodities, and signs [that] economic activity is being disrupted by the mounting dissent in the country will be seen as negative for demand.”

“Susannah Streeter, senior investment and markets analyst at broker Hargreaves Lansdown, said the unprecedented waves of protest had “caused ripples of unease across financial markets”.

She added: “Already pockets of violence have erupted as police forces push back at protesters, but there are expectations that a much more stringent security clampdown will be ordered.”

Victoria Scholar, from investment platform Interactive Investor, commented: “International investors have become a lot more cautious towards China.”

They are spooked about the possibility of Xi imposing even stricter rules and measures to curtail the length and spread of the demonstrations.

The market fallout also hit the price of grain, wheat and soybeans which all fell.

Covid curbs which fuelled anger among staff at the world’s largest Apple iPhone factory may reportedly further hit production in the festive runup.

Owner Foxconn might find more than 30 percent of the Zhengzhou site’s November production affected.

Demonstrators claim the death toll in a fire at flats in Xiniang was made worse by Covid quarantine measures that trapped residents, which authorities denied.

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