China's economy grew by 3.9% in Q3 2021, which exceeded expectations, but concerns about the country's future economic policy and growth weighed on foreign investors.
China's leadership change, including the appointment of Li Qiang as Xi Jinping's second-in-command, has sparked worries about potential further nationalisation of corporate interests.
Additionally, China faces challenges both from within, such as its zero-Covid policy and the crackdown on debt in the real estate industry, and from abroad, including the ongoing trade conflict with the US.
Despite concerns regarding China's economic policy and growth, data released on Monday shows some signs of improvement.
Western economists' expectations of just over 3% growth were exceeded by China's Q3 2021 growth rate of 3.9%.
While the rebound in activity is modest, the main concern is whether the country's leadership changes could lead to further nationalisation of corporate interests, which could squeeze private businesses' growth prospects.
Investors are also worried about China's zero-Covid policy and the ongoing US-China trade conflict.