Lockdowns Lead to Slowdown

April 27, 2022 | David Hernandez, CFA, Director of Traditional Manager Search

Combined column and line chart showing China PMI and COVID-19 cases. Chart subtitle: China PMI fell to a 2-year low amid renewed COVID lockdowns. Chart visual description: Chart has two y axes; left displays China PMI, ranging from 25 to 60 and corresponds with light green columns and a dotted line representing 50 as neutral PMI. Right displays 7-day Average New Covid-19 Cases for China, ranging from 0 to 35,000, and corresponding with blue line. X-axis shows monthly increments from 1/29/20 to 3/31/22. Columns align with each month label, but new cases line goes a little further, as of 4/21/22. Chart data description: Most columns are in the range of 51 to 56, but February 2020, August 2021, and March 2022 were all below neutral, at 28.9, 48.9, and 48.8 respectively. 7-day average new cases blipped up to 4,500 in early 2020 as China came to terms with implementing "Zero Covid" policies, then remained flat or very near flat until early 2022. Particularly March into April numbers have grown exponentially, with 4/21 hitting 30,000+. Chart sources: ourworldindata.org, Bloomberg. End chart description.

COVID cases have been on the rise in China over the last ten weeks, surpassing February 2020 highs by 800%. The seven-day rolling average has moved from 110 new cases at the end of January 2022 to a high of 30,500 on April 21st. Since the beginning of the pandemic, China has operated with a zero-COVID policy, combining testing and tracing with the use of lockdowns to prevent the spread of the virus. These measures have resulted in an extremely low case count compared to the rest of the world. The country’s recent high near 30,000 is still well below the U.S. seven-day average peak of 800,000 in January 2022.

China’s aggressive use of lockdowns to control the spread of the virus has impacted the country’s economic activity. March’s Purchasing Managers Index (PMI) reading was 48.8, below the neutral 50 mark, indicating a contraction in economic activity. Several Chinese cities are feeling the pressures of the recent lockdown, including Shanghai, a key finance and manufacturing hub. Many investors expect Chinese authorities to step in with supportive policies to help the country navigate the current downturn. Ultimately, however, China may need to choose between two of its seemingly opposing agenda items — its zero-COVID policy and its 5.5% target growth rate — with the choice likely to have material implications for equity markets for the rest of 2022.

Print PDF > Lockdowns Lead to Slowdown

 

The opinions expressed herein are those of Marquette Associates, Inc. (“Marquette”), and are subject to change without notice. This material is not financial advice or an offer to purchase or sell any product. Marquette reserves the right to modify its current investment strategies and techniques based on changing market dynamics or client needs.

David Hernandez, CFA
Director of Traditional Manager Search

Get to Know David

The opinions expressed herein are those of Marquette Associates, Inc. (“Marquette”), and are subject to change without notice. This material is not financial advice or an offer to purchase or sell any product. Marquette reserves the right to modify its current investment strategies and techniques based on changing market dynamics or client needs.

Related Content

Line chart showing average option-adjusted spreads (OAS), in basis points, on Bloomberg CCC U.S. High Yield and Bloomberg U.S. Corporate High Yield bonds from December 2025 through October 2026. CCC-rated high yield spreads increased from approximately 600 bps to 1,100 bps, reaching their highest levels in nearly four years, while broader U.S. corporate high yield spreads remained relatively stable, increasing from approximately 260 bps to 330 bps. Source: Bloomberg as of November 6, 2026. For full dataset, please contact marquettemarketing@marquetteassociates.com.

11.09.2026

C’s Get Degrees (of Pain)

The U.S. distressed debt market is showing increasingly pronounced signs of stress. As of this writing, option-adjusted spreads on CCC-rated…

Bar chart comparing October and year-to-date 2026 returns for Korea, Taiwan, Brazil, India, China, and the MSCI Emerging Markets Index. October returns are below zero for most markets, while year-to-date returns range from negative to positive. For full dataset, please contact marquettemarketing@marquetteassociates.com.

11.02.2026

The Haunting of Emerging Markets

Emerging markets faced a challenging October, with the space declining by around 8.3% amid renewed concerns over the sustainability of…

Stacked bar chart showing U.S. private equity deal value by deal size from Q1 2022 through Q2 2026. The y-axis shows percentage of total deal value from 0% to 100%, and the x-axis shows quarters by year. Stacked bar chart showing the percentage of U.S. private equity deal count by deal size from Q1 2022 through Q2 2026. The y-axis ranges from 0% to 100%, and the x-axis shows quarters by year. For full dataset, please contact marquettemarketing@marquetteassociates.com.

10.26.2026

Smaller Deals, Larger Appeal

Private equity activity is increasingly shifting toward smaller transactions, with total deal value for transactions of $100 million or less…

10.08.2026

3Q 2026 Market Insights

This video is a recording of a live webinar held October 22 by Marquette’s research team analyzing the third quarter…

10.22.2026

Will Higher Rates Cramp the Markets?

Anyone who has run a marathon knows the last six miles are brutal — no matter how well the first…

Line chart comparing S&P 500 Index cumulative returns for midterm and non-midterm election years since 1980. The x-axis shows October through December, and the y-axis shows S&P 500 Index cumulative return, ranging from -1% to 8%. For full dataset, please contact marquettemarketing@marquetteassociates.com.

10.19.2026

Divided We Rise?

Since 1980, the S&P 500 Index has generally performed well in the weeks surrounding U.S. midterm elections. Specifically, the index…

More articles

Subscribe to Research Email Alerts

Research Email Alert Subscription

Research alerts keep you updated on our latest research publications. Simply enter your contact information, choose the research alerts you would like to receive and click Subscribe. Alerts will be sent as research is published.

We respect your privacy. We will never share or sell your information.

Thank You

We appreciate your interest in Marquette Associates.

If you have questions or need further information, please contact us directly and we will respond to your inquiry within 24 hours.

Contact Us >