Alibaba led a $89 billion plunge in Chinese stocks after Xi Jinping was elected for a third term

U.S.-listed Chinese stocks fell on Monday as investors worried that President Xi Jinping’s tightening grip on government during his unprecedented third term would stifle the economy and private enterprise.

China’s Nasdaq Golden Dragon index, made up of 65 Chinese stocks, fell 15%, losing about $89 billion in market value. The largest Internet companies, from Alibaba Group Holding Ltd. to Inc., suffered double-digit declines. KraneShares CSI China, an online fund that tracks more than 40 Chinese stocks, fell 15%.

Monday’s fall comes after Xi Jinping added six loyal members to the Politburo Standing Committee in a party leadership reshuffle that takes place twice a decade. The unprecedented power play demonstrated his undisputed control over the highest decision-making body in the country. Hong Kong’s Hang Seng Tech Index, which tracks shares of Internet giants including Alibaba and Tencent Holdings Ltd., fell nearly 10 percent.

Such dominance is fueling concerns that China may hold back its full economic recovery for even longer as there are fewer voices at the top challenging Xi Jinping’s Covid Zero policy.

Investors also worry that the ruling party may stick to its tough approach to domestic private businesses and tech entrepreneurs while ramping up military pressure on Taiwan.

“The concern is that absolute power may lead to harsh policy both locally and internationally,” said Sharif Farha, head of investments at HB Investments. “On a local level, zero covid policy or tougher regulations on China tech may not go away. On an international level, the market is definitely concerned about political tensions.”

By controlling the Politburo with the help of allies, Xi Jinping “signals a clear longer Covid Zero policy in China, which is bad for China’s growth and stocks,” said Cesar Perez Ruiz, chief investment officer of Pictet Wealth Management.