China Markets Plunge 10% Amid Global Recession and Deeper Trade War Worries

Li Chen
07 Apr, 2025
Hong Kong

Stock market indexes in China and Hong Kong plunged after investors returned from a three-day holiday and reacted to sharp losses on Wall Street. 

The Hang Seng plunged 12%, and the CSI 300 index declined 8% after China retaliated with a 34% tariff on U.S. goods. 

Asian markets extended the previous week's rout, and benchmark indexes in Hong Kong dropped a whopping 12%, in Japan dropped 6%, in Korea and Australia fell 5%, and in India declined nearly 4%. 

World markets are likely to extend losses after the Trump administration showed no sign of backing down from stiff tariffs, and China announced its retaliatory tariff of 34% on U.S. goods starting on April 10. 

Global stock market sentiment is deteriorating rapidly, and investors are seeking safety in bonds and Japanese and eurozone currencies. 

Crude oil dropped to $60.40 a barrel, the level last seen in early 2021, and gold declined for the third consecutive session amid growing worries of a global recession and a sharp decline in corporate earnings. 

The Chinese yuan faced selling pressure amid rising outflows, and the currency traded at 7.31 against the U.S. dollar in offshore markets. 

 

China Indexes and Stocks 

The Hang Seng index plunged 11.8% to 20,136.53 and mainland-focused CSI 300 index dropped 7% to 3,587.75

Alibaba Group Holding dropped 17% to HK $101.50, Tencent Group Holdings declined 13% to HK $431.60, JD.com Inc., and Baidu Inc. plunged 13.7% to HK $75.75.  

BYD plunged 10% to ¥321.76 yuan, Li Auto declined 16.5% to HK $81.75, and Xpeng dropped 17.5% to HK $67.30. 

HSBC Holdings plc decreased 14.8% to HK $73.65, China Merchants Bank declined 9% to HK $40.95, and Bank of China fell 8.7% to HK $4.22.