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China's shock Covid shift adds fuel to world-beating stock rally

Bloomberg
Bloomberg6/28/2022 09:38 PM GMT+08  • 3 min read
China's shock Covid shift adds fuel to world-beating stock rally
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Chinese shares rallied ever closer to a bull market after Beijing unexpectedly halved the mandatory quarantine period, marking a key shift away from the government’s fixation with Covid Zero that has clouded the outlook for investors.

The CSI 300 Index closed 1% higher Tuesday, June 28, taking the gauge from an April low to a 19% gain -- among the best-performing major benchmarks in the world during that period. Hong Kong’s Hang Seng Index erased an earlier loss to close 0.9% higher. Currencies strengthened in Thailand and Australia -- countries that count on China for tourists and trade.

China’s move to cut its quarantine period to 10 days from three weeks for inbound travellers shows authorities’ increasing concern about the economic toll from stringent virus restrictions. The change will fuel investor optimism that along with the support from monetary and fiscal policies, Chinese stocks will continue to outperform while global peers buckled under the pressure of rising interest rates.

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