Alibaba, JD, and other Chinese stocks jump as easing of some virus restrictions fuels hopes China will back down from zero-COVID policy
Alibaba and shares of other Chinese stocks listed in the US rose Tuesday on speculation China may relax its zero-COVID policy.
Moves by officials after major protests including ramping up vaccinations for the vulnerable elderly population.
Stocks in China also rose in Tuesday's session.
Alibaba and shares of other Chinese companies listed in the US charged higher Tuesday as moves by Chinese officials stoked speculation the government may move toward sustainably relaxing the strict zero-COVID policy.
Protests against lockdown and quarantine measures have swept across major cities in the country in recent days. Among the responses, the country's National Health Commission said it will accelerate COVID vaccinations for elderly residents, according to a Reuters report Tuesday.
E-commerce heavyweight Alibaba gained 5% on New York Stock Exchange and rival JD.com picked up 7.5% on the Nasdaq. Search engine company Baidu rose by nearly 7%%.
Meanwhile, officials in the southern manufacturing city of Guangzhou said some residents will no longer be required to undergo mass coronavirus testing, according to an Associated Press report. The report also said Beijing would no longer put up gates to block access to apartment compounds where infections are detected.
Beijing made no mention of a deadly apartment fire last week in the city of Urumqi that jumpstarted the protests, AP reported. Rare displays of public dissent – including calls for China's President Xi Jinping to step down - were set off after 10 people died in the fire.
Stocks in Chinese markets climbed on Tuesday. Hong Kong's Hang Seng Index gained 5.2% and the mainland's Shanghai Composite gained 2.3%.
"While I can imagine the path from zero-Covid to zero restrictions will be long and full of potholes and hurdles, the response to the unrest has appeared more promising than feared," Craig Erlam, senior market analyst at Oanda, said in a note.
"It may well be that the leadership had already been gauging the public mood on restrictions and had, as has been rumoured, already been planning its exit strategy which recent comments align with," he said. "Either way, it appears zero-COVID has reached a crossroads and the direction of travel now will determine investor appetite toward Chinese stocks going into 2023. Today's rebound suggests there's some optimism."
Electric vehicle makers Nio and XPeng rose 4% and 5.3%, respectively.
Protests died down in Beijing, Shanghai and other cities on Tuesday and police were randomly checking people's phones at a subway station in Shanghai, AP reported.
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