China’s major stock indices plunged more than three percent on Monday as investors around the globe became increasingly anxious about the possible impacts from ongoing U.S.-Israeli military operations against Iran, said a market analyst.
The benchmark Shanghai Composite Index was down 3.63 percent to 3,813.28 points.
The Shenzhen Component Index closed 3.76 percent lower at 13,345.51 points.
The ChiNext Index, tracking China's Nasdaq-style board of growth stocks, lost 3.49 percent to close at 3,235.22 points.
Timothy Pope, a market analyst for China Global Television Network (CGTN), said there are concerns that rising oil prices may drive up inflation around the world and impact the global demand for Chinese exports.
"Today the Chinese mainland markets looked like they were preparing for an oil shock. The Shanghai Composite Index shed 3.6 percent. The Shenzhen Component Index was down 3.75 percent. And this follows on from last week, which was the worst for the Chinese equities since November. The increase in tensions in the war with Iran, which have seen a U.S. ultimatum and more threats from the Iranian side as well, have added extra anxiety to an already jittery global marketplace. We talked last week of concerns that war-driven inflation could impact the Chinese economy, and we could be looking at lower demand for Chinese exports if there's significant fallout from rising global oil prices," said Pope.
He said Monday's sell-off was very broad.
"Investors backed out of pretty much everything from tech to consumer stocks. Energy stocks were about the only sector doing OK, although they too were broadly negative by the close of the trade. There were some gains for oil exploration stocks, coal producers and new energy providers. But that was nothing like enough to offset the heavy losses that we saw elsewhere. Agriculture stocks took a beating as well. They are expected to see costs rise as a result of the bottleneck for oil getting out of the Middle East. Also, fertilizer too. We've learned that the Middle East is a major fertilizer production hub," said Pope.
Chinese shares plunge amid growing tensions in Middle East
