The selloff in Chinese assets is intensifying as this week’s Communist Party Congress disappoints traders concerned about slowing economic growth, a faltering property sector and a strict Covid Zero policy.

The benchmark CSI 300 Index has fallen more than 2 per cent this week, after posting the worst three trading days since the start of a Party Congress from the gauge’s inception in 2005. An index of mainland Chinese companies listed in Hong Kong is heading for its lowest close in 14 years, while China’s high-yield dollar bonds have declined for seven straight days. 

The offshore yuan has slumped to the weakest level against the dollar since it started trading in August 2010, even as the central bank has sought to stabilise onshore trading by guiding banks to track its daily fixing.

Many investors had been looking to the leadership gathering to deliver fresh market impetus after the nation’s assets have been among the worst-performing in the world. President Xi Jinping’s renewed pledge for technology self-reliance offered some reprieve to the sector, but his defence of Covid Zero and the lack of new stimulus for the property sector were seen as a disappointment.

Adding to investor concern is an increase in Covid cases in Beijing to the highest in four months and the government’s decision to delay the release of key economic indicators. The soft outlook projections from Chinese consumer companies led to a selloff in consumer stocks Wednesday.