China Covid relaxation, Hong Kong stocks rise


Morgan Stanley raises Chinese stocks to overweight

Morgan Stanley strategists have raised their recommendation for Chinese stocks to overweight, according to a Sunday note.

The upgrade marks the end of the company’s equivalent position in Chinese stocks it has held for nearly two years, strategists led by Laura Wang said.

Morgan Stanley noted multiple factors seeing “meaningful positive development” since November, including what the company sees as “a confirmed path to definitive post-Covid reopening.”

—Michael Bloom, Jihye Lee

Hong Kong movers: Chinese tech companies and stock reopening jump

Chinese technology, consumer and travel-related companies listed in Hong Kong posted hefty gains in early trading after some cities in China saw some easing of Covid restrictions.

Tech heavyweights Tencent gained 5.5% and Meituan rose 3.5%, while Alibaba jumped 4.72% and Xiaomi 7.31%. EV stocks like Li Auto rose 9.19% and Nio climbed 11.5%.

Meanwhile, Hong Kong-listed casino stocks also rose, with MGM China up 12.44%, Wynn Macau up 12.35% and Sands China up 7.5%. Galaxy Entertainment rose 3.61% and SJM Holdings increased by 4.82%.

Hotpot restaurant operator Haidilao rose 15% and airline stocks also rose. South China Airlines and China Eastern airlines each rose more than 5% while Air China 4% won.

The broader Hang Seng index rose 3.21%.

—Abigail Ng, Jihye Lee

China’s services activity index hits six-month low, private survey shows

The Caixin/S&P Global services Purchasing Managers’ Index for November came in at 46.7, represents the lowest value in six months.

The print also marks the third consecutive month of contraction in output and new work, after October’s reading came in at 48.4, while September’s print was 49.3.

PMI measures are sequential and represent month-over-month changes in factory activity. The 50-point boundary separates growth from shrinkage.

“The rate of decline was solid overall, but remained weaker than the declines experienced during the previous large wave of Covid-19 cases from March to May,” Caixin said in a press release.

“Efforts to curb the spread of Covid-19 amid a notable increase in cases in recent weeks weighed on service sector business activity and customer demand across China in November,” it added.

China’s official non-manufacturing PMI released last week stood at 46.7, the lowest since April 2022.

— Abigail Ng

Chinese Yuan Strengthens After Hope Reopened

The Chinese currency strengthened to around 7 against the US dollar following the latest reports pointing to further easing of China’s covid policies.

The offshore yuan was trading at 6.9861 against the greenback, rising past 7 levels for the first time since mid-September.

Beijing and Shenzhen are taking steps to relax testing requirements and quarantine rules, despite the daily number of cases nearing an all-time high.

The latest steps come about a week after public unrest broke out in various parts of the country over the strict measures.

— Jihye Lee

Oil futures are up 2% after OPEC+ holds steady and China reportedly eases some Covid restrictions

Chinese markets suspend trading for 3 minutes on Tuesday as the country mourns the former leader

CNBC Pro: Fund Manager Names Two Global Retailers About to ‘Dominate’

A veteran Schroders fund manager has named two international retailers on the verge of “dominating” their industry.

Andrew Brough, who manages the Schroder UK Mid Cap Fund, said the two conservatively-led companies are gaining market share ahead of a recession by quietly acquiring failing competitors on the cheap.

One of those stocks is already up 30% this year, while its reference index is down 29%.

CNBC Pro subscribers can read more here.

— Ganesha Rao

Equity futures tumble, bond yields rise on higher-than-expected job numbers

Equity futures fell while bond yields rose in response to the 8:30am jobs data coming in stronger than economists had expected.

Here’s how each major futures index and notable bond yields moved over the 30 minutes leading up to and after the data was released:

CNBC Pro: Goldman Sachs upgrades this global tech giant, says its stock could jump up to 90%

Goldman Sachs sees an opportunity in electric vehicles that is on an “uptrend.”

This trend will accelerate as EVs become “increasingly technology-driven” and easier to build, Goldman analysts said in a Dec. 1 report.

That will benefit one global stock, said Goldman, giving the stock up to 90% in its bull case for the company.

CNBC’s Pro subscribers can read more here.

— Weizhen Tan

US payrolls increased by 263,000 in November

Job growth was stronger than expected in November, despite the Federal Reserve’s efforts to cool the labor market.

Nonfarm payrolls grew by 263,000 last month, while the unemployment rate remained unchanged at 3.7%, the Labor Department said on Friday.

According to consensus estimates from the Dow Jones, payrolls would rise by an additional 200,000 jobs. The unemployment rate was expected to remain at 3.7%.

Equity futures fell after the payroll announcement.

— Sarah Min

The Valley Voice
The Valley Voice
Christopher Brito is a social media producer and trending writer for The Valley Voice, with a focus on sports and stories related to race and culture.


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