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: Nio stock dives below $10, Alibaba hits 6 1/2-year low as Xi’s power move fuels fears

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The U.S.-listed shares of China-based companies were rocked Monday, as China President Xi Jinping’s moves to consolidate power fueled fears that current policies that have led to a slowing economy will continue.

Chinese leader Xi was named over the weekend to a third, five-year term as general secretary, ignoring the custom of stepping down after two terms, as the Associated Press reported. Xi also dropped No. 2 leader Premier Li Keqiang, a proponent of market-style reform and private enterprise, from a seven-member Standing Committee in favor of stronger Xi allies.

That spooked investors already reeling from a slowing economy, amid fears over the current zero-COVID policy that has led to lockdowns, and uncertainty over whether the crackdown on technology companies will continue.

The iShares China Large-Cap exchange-traded fund
FXI,
+0.63%

sank 8.8% in premarket trading, putting them on track to open at the lowest price seen during regular-session hours since November 2008.

That follows a 6.4% plunge in Hong Kong’s Hang Seng
HSI,
-6.36%

to a 13-year low, while the Shanghai Composite
SHCOMP,
-2.02%

shed 2.0%.

Also, while data showed that the Chinese economy grew more than expected in the third quarter, the pace of growth year to date remained well below the annual growth target. “The [growth] gap is due to China’s impossible COVID-zero mission, which has been confirmed and cemented with Xi’s third term in office,” said Ipek Ozkardeskaya, senior analyst at Swissquote Bank.

Among the more-active China-based companies trading in the U.S., shares of electric vehicle maker Nio Inc.
NIO,
+2.19%

tumbled 11.9% ahead of the open, to head for the first trade below the $10 level since July 2020.

Among other EV makers, shares of XPeng Inc.
XPEV,
+2.39%

dropped 12.4% toward a record low and Li Auto Inc.
LI,
+2.72%

lost 9.9% toward a two-year low.

Ecommerce giant Alibaba Group Holding Ltd.’s stock
BABA,
+0.22%

dove 11.8% toward the lowest price seen since February 2016.

Elsewhere, shares of JD.com
JD,
-0.02%

slumped 15.7%, Pinduoduo Inc.
PDD,
+5.51%

cratered 14.9%, iQiyi Inc.
IQ,
-1.93%

lost 10.3%, Bilibili Inc.
BILI,
-0.18%

plunged 16.8% and Baidu Inc.
BIDU,
-2.29%

slid 12.0%.

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