Hong Kong stocks tank to 14-year low as re-elected Xi's reshuffle sparks worries about China's economic recovery

The stock market in Hong Kong plunged to a 14-year low on Monday, as fears of a recovery in China's economy were raised.

The Hang Seng Index was trading near its 2008 lows. The Hang Seng Tech Index was more than 10% lower as shares of Chinese tech giants fell.

The selloff took place after the Communist Party chief, Xi, secured a third term in office. Analysts said that could mean a tighter grip on the economy.

According to a Monday report by Bank of America analysts, the new leadership indicates more concentration in top decision making procedure. Some investors may be concerned about the lack of checks and balances and the risk of policy mistakes.

China's GDP rose 3.9% in the third quarter from a year ago, according to official data. It was not enough to give a boost to investors worried about the impact of zero-COVID curbs on the economy.

In September, exports grew at a slower pace than in the previous month, while unemployment and retail sales both grew at a slower rate.

"This set of data shows that even though COVID measures have become more flexible, they are still a big uncertainty to the economy with the background of the real estate crisis."

Relations between China and the US have cooled, which has caused Hong Kong stocks to fall. China's tech industry is in danger of being crimped by the Biden administration.

In a report to Congress, the president called for regulation of the mechanism of wealthAccumulation, a sign of increased oversight of private capital.

Other assets did well Monday.

• The mainland Shanghai Composite Index of stocks closed 2% lower.
• The CSI 300 index of Shanghai- and Shenzen-listed stocks was down almost 3%.
• The onshore Chinese yuan fell 0.3% to 7.2531 per US dollar, nearing a January 2008 low of 7.2552.
• The Hang Seng China Enterprises Index of major mainland companies lost 7.9%.