Traders are also fretting over possible sanctions if Beijing reacts to Russia’s plea for military help in its Ukraine invasion, which could lead to measures against Chinese firms including possible sanctions.

The Hang Seng Index sank 3.07%, or 600.48 points, to 18,931.18.

The Shanghai Composite Index dived 0.97%, or 31.17 points, to 3,192.36, while the Shenzhen Composite Index on China’s second exchange lost 0.87%, or 18.38 points, to 2,091.09.

The Hang Seng Index dived 5% Monday as the Hang Seng Tech Index was pummelled 11% after China said it would lock down Shenzhen to contain a Covid outbreak.

The crisis has further rattled Hong Kong investors who have had to contend with China’s regulatory crackdown on the private sector, with once-flying technology companies often in the crosshairs.

Chinese firms listed in the US were battered last week owing to concerns about a crackdown by authorities there.

A gauge of Chinese firms listed in New York plunged 11% Monday, with ecommerce giants Alibaba and JD.com down around 10%.

A “material rerating for China tech may need to see a shift in regulatory tone”, Marvin Chen, a strategist at Bloomberg Intelligence, said, adding that interplay between Moscow and Beijing would be closely followed.