SHANGHAI: China stocks plunged on Monday in their biggest slump since the pandemic-led panic-selling in February 2020, on heightened worries of a country-wide COVID-19 outbreak and fears of strict restrictions being imposed in the capital city of Beijing.

The blue-chip CSI300 index fell 4.9% to close at a two-year low of 3,814.91, while the Shanghai Composite Index tumbled 5.1% to 2,928.51 points.

Both indexes have erased all gains made since Vice Premier Liu He’s pledge on March 16 to support the economy and financial markets. Hong Kong shares declined the most in six weeks. The Hang Seng index fell 3.7% to 19,869.34, while the China Enterprises Index lost 4.1% to 6,684.73 points.

China’s yuan also fell to a one-year low against the dollar, extending losses after posting its worst week since 2015, while a worsening economic growth outlook drove investor concerns that the currency could weaken further.