Share prices fall on concerns over further China lockdowns
Fears over the impact of China’s economic lockdowns on global growth have caused stock markets in the United States and Asia to plummet.
The Nasdaq Composite index, which is heavily weighted toward technology, finished at its lowest level since late 2020 on Tuesday. Tesla was a major loser, with its market value plummeting by more than $125 billion (£99.3 billion) as CEO Elon Musk presses on with his takeover of Twitter.
Markets were also pulled down by concerns over earnings releases from some of the world’s largest technology companies. At the same time, reports that Russia will reduce gas supplies to Poland and Bulgaria exacerbate the unease.
Investors were already concerned about the possibility of rapid interest rate hikes in the United States and elsewhere to confront increasing global inflation and the conflict in Ukraine.
Beijing officials are attempting to contain a COVID-19 epidemic to avoid a repetition of the city-wide restrictions that have kept Shanghai shut down for the past month.
Concerns have been voiced regarding the chances for growth in the world’s second-largest economy, as well as the global implications.
The Nikkei 225 index in Japan sank 1.2 per cent, while the Kospi index in South Korea fell 1.1 per cent. This came on the heels of stock market losses in New York, with the Dow Jones Industrial Average closing 2.4 per cent lower on Tuesday and the Nasdaq dropping more than 4%.
Shares in mainland China, on the other hand, climbed after losing ground earlier in the week. The Shanghai Composite climbed 2.5 per cent on Wednesday, while the CSI 300 gained 2.9 per cent. Meanwhile, Tesla’s stock dropped more than 12% as its CEO pressed through with his buyout of Twitter.
After US markets closed, Alphabet, Google’s parent firm, stated that the fighting in Ukraine had harmed YouTube advertising sales, causing its stock to fall in after-hours trading.