Concerns over Beijing’s strong ties with Russia, as well as increasing threats, triggered panic selling in Chinese stocks on the Hong Kong Stock Exchange, which experienced their worst day since the global financial crisis of 2008. The Hong Kong stock exchange has plummeted in response to the possibility of China-Russia aid amid the ongoing Russia Ukraine war.

On Monday, the Hang Seng China Enterprises Index fell 7.2 per cent, the most since November 2008. The Hang Seng Tech Index fell 11% in its most extensive decline since its inception in July 2020, wiping out $2.1 trillion in value since its peak a year ago.

The expansive downfall of the Hong Kong share market follows a report citing US officials that Russia has asked China for military assistance in its war in Ukraine. ​Traders are reportedly concerned that Beijing’s probable outreach to Putin might result in a global backlash against Chinese enterprises, including penalties and sanctions, despite China’s denial of the claim. A COVID-induced lockdown in the southern city of Shenzhen, a vital tech hub, and the northern province of Jilin also harmed sentiments.

There’s also a possibility that Chinese companies will be delisted from the stock exchanges in the United States as the Securities and Exchange Commission has named certain names as part of a crackdown on foreign companies that decline to disclose their books to US regulators, US Securities and Exchange Commission said last week.

China to aid Russia: US officials

According to US officials, Russia has asked China for military ​equipment to ​support its invasion of Ukraine. On Sunday, a Washington Post report, which cited a US official, claimed that Moscow had asked for military equipment from Beijing. While it wasn’t clear what kind of weaponry or assistance had been asked for by Moscow, China’s standpoint stirred speculation that it might fulfil the demand. A different report in the Financial Times disclosed that the Kremlin has been asking for military aid from China since the start of its attack on Ukraine.

According to the Financial Times, a representative for the Chinese embassy in Washington denied any Russian demands, saying he had “never heard of such.” Furthermore, he stated that the establishment of peace and stability in Ukraine was Beijing’s top objective, a remark that the Chinese Communist Party has repeated despite admitting that it has strong ties with the Putin administration.