China stocks rise on rumors of easing COVID restrictions

Yahoo Finance Video
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Yahoo Finance’s Jared Blikre breaks down how markets opened on Tuesday.

Video Transcript

[AUDIO LOGO]

BRAD SMITH: You're actually taking a look at China markets here as well.

JARED BLIKRE: That's right. We just finished the best October ever for the Dow. And we're gonna take a look at the Hang Seng and also the Shanghai Composite. The latter up 2 and 1/2%. Hong Kong up 5%.

But you can see, this is a three-month chart. Started falling off in September. October was an absolute disaster for a lot of these stocks. And I'm gonna show you what's happening inside the Chinese market right now.

Now, these are the components in the Golden Dragon Index. And we can see Alibaba up over 6 and 1/2%. So is JD.com, Pinduoduo. Some of the others is really flying high. Trip.com, which was a real sore spot yesterday, that's up 12%. And so on.

But let me just show you what's happened over the last month. Now, this came as President Xi was consolidating power over his third unprecedented consecutive term. And what may be happening now is a rollback in some of those COVID restrictions, the COVID Zero Policy that they have.

Now, this would have the effect of massive re-openings within the company. There are reports that there is kind of a stealth lockdown right now. But in fact, if China has, in fact, reached peak lockdown, you gotta think that there's a lot more upside for some of these stocks and also for the engine of growth in a lot of companies like Apple that have been suffering because of the lack of supply there. So we'll have to see what goes on.

Let me just get a quick check of the overall market today. And let me put it on intraday. We have consumer discretionary, that's in the lead. Also communication services, almost up about 1 and 1/2%, followed by energy, real estate, materials, and tech rounding out the lead there.

Taking a look inside the NASDAQ 100, Tesla, the standout. That's up 3 and 1/2%. Looks like we got some love and biotech. Moderna up 4 and 1/2%. Win over those Chinese stocks, and I gotta say, it's looking like a green day here. Guys.