There’s been a surge in the share prices of Chinese stocks listed in Hong Kong and the U.S., a sign investors are optimistic China is beginning gradual shift away from its zero-Covid policy.
Following widespread protests across China over the past week, the Chinese government has moved to ease some pandemic-related restrictions.
Chinese stock markets rallied after China’s top health body said it will bolster a vaccination effort targeted at senior citizens. Central government agencies have issued new warnings banning the implementation of excessive control measures, blaming local government entities for excessively severe Covid lockdowns.
The Hang Seng China Enterprises Index is up 29 percent since 1 November – its best run in two decades – while the benchmark Hang Seng Index has surged 27 percent, its biggest rise since 1998. Investors are betting in particular on mainland restaurant operators and major purchasers of seafood. The share price of Haidilao, an operator of hotpot restaurants across China, rose 44 percent in November on the Hong Kong Stock Exchange. The share price of upmarket mainland restaurant chain Jiumaojiu, also traded on the Hong Kong exchange, rose 41 percent in November.
Stocks included in the CSI 300 Index of mainland shares gained nearly 10 percent in November. The value of stocks in China’s most-valuable seafood firm by capitalization, Guolian Aquatic, increased from CNY 4.80 (USD 0.68, EUR 0.65) at the start of November to CNY 5.80 (USD 0.83, EUR 0.78) by the month’s end.
U.S.-listed Chinese stocks in the Nasdaq Golden Dragon Index jumped 30 percent in November, after falling 25 percent in October. Online grocer Dingdong Maicai’s share price has jumped 90 percent on the New York Stock Exchange over the past month, though the company’s stock price remains at a quarter of its value when the stock was listed in 2021. The share price of Chinese fishing firm Pingtan Marine, however, remains well below the USD 1.00 (EUR 0.95) minimum share price level required by Nasdaq, which has given the firm a delisting warning.
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