Asia stocks gain after China relaxes Covid rules
World shares advanced Tuesday after China announced it would relax more of its pandemic restrictions despite widespread outbreaks of Covid-19 that are straining its medical systems and disrupting business.
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Bangkok: World shares advanced Tuesday after China announced it would relax more of its pandemic restrictions despite widespread outbreaks of Covid-19 that are straining its medical systems and disrupting business. China's National Health Commission said Monday that passengers arriving from abroad will no longer have to observe a quarantine, starting Jan. 8. They will still need a negative virus test within 48 hours of their departure and to wear masks on their flights. But it was the latest step toward dropping once-strict virus-control measures that have severely limited travel to and from the world's No. 2 economy.
"With economic activity floundering, and multinationals questioning the viability of China as a sourcing location, policymakers have — as so many times in the past — adopted a very business-like approach," Stephen Innes of SPI Asset Management said in a commentary.
Companies welcomed the move as an important step toward reviving slumping business activity. Germany's DAX gained 0.7% to 14,032.67 and the CAC 40 in Paris was up 0.9% at 6,564.29. Markets in London were closed for a holiday. Oil prices also advanced. The futures for the Dow Jones Industrial Average and the S&P 500 were 0.6% higher. On Friday, the S&P 500 closed 0.6% higher. It is down 19.3% for the year, just on the cusp of a bear market. The Dow Jones Industrial Average rose 0.5%, while the tech-heavy Nasdaq edged 0.2% higher. The Russell 2000 index picked up 0.4%.
China has joined other countries in treating cases instead of trying to stamp out infections. It has dropped or eased rules on testing, quarantines and movement, trying to reverse an economic slump.
But the shift has flooded hospitals with feverish, wheezing patients, and authorities are going door to door and paying people older than 60 to get vaccinated against Covid-19. The Shanghai Composite index jumped 1% to 3,096.57. Hong Kong's markets were closed for a holiday, as were those in Australia. Tokyo's Nikkei 225 added 0.2% to 26,447.87 and the Kospi in Seoul gained 0.7%, to 2,332.79.
