China crackdown weighs on London’s FTSE 100

London’s FTSE 100 was today weighed down by fears Chinese authorities could drag down global growth by responding forcefully to protests against the country’s zero-Covid policy.

The capital’s premier index dropped 0.17 per cent to 7474.01 points, while the domestically-focused mid-cap FTSE 250 index, which is more aligned with the health of the UK economy, dipped 1.3 per cent to 19,292.35 points.

FTSE 100 closes lower

Over the weekend, protestors lined the streets of major Chinese cities to express their distaste toward Beijing lawmakers pushing on with imposing tough measures on daily life to tame the virus.

While most of the rest of the developed world are enjoying few if any Covid-19 prevention measures, an awful vaccine rollout has meant Chinese officials have had to keep launching snap lockdowns to tame outbreaks.

“European markets have started the week on the back foot as sporadic unrest across China sparks a selloff in global equities. With the rest of the world enjoying life and learning to live with Covid, China continues to double down on a strategy that has little chance of success without an accompanying vaccine program,” Michael Hewson, chief markets analyst at CMC Markets UK, said.

Many investors have bet on a Chinese reopening boosting global economic growth. However that now seems a risky wager.

FTSE 100 listed housing stocks fared poorly today after data from search site Zoopla revealed demand is collapsing under the weight of higher interest rates.

Home builders Persimmon, Taylor Wimpey and Barratt Developments all fell more than 1.8 per cent.

The pound slid around 0.5 per cent against the US dollar.