SHANGHAI: China stocks rose on Monday as strong consumer spending and a rebound in travel during the country’s week-long Lunar New Year holidays boosted investor sentiment.
China’s CSI 300 Index closed up 0.5%, after opening 2.1% higher to touch a half-year high, while the Hang Seng Index retreated 2.7% after two sessions of gains when Chinese markets were closed.
The CSI 300 benchmark has gained nearly 20% since an October low as investors bet on the positive impact of China’s dismantling of strict COVID-19 control rules. In a policy U-turn, China dropped its zero-COVID strategy in December.
“Thanks to the rapid transition to herd immunity and the release of pent-up demand, there has been a notable recovery in in-person services consumption during the week-long holiday,” Nomura said in a note.
Shares in new energy climbed 1.9%, automobiles soared 3.1%, and consumer discretionary added 1.2%.
Official data showed Lunar New Year holiday trips inside China surged 74% from last year after authorities scrapped COVID travel curbs, while almost a quarter more domestic Chinese tourism trips have been made during the holidays.
Yuekai Securities analysts said a steady recovery of consumption, a general rise in overseas markets during the holidays and accelerated foreign inflows should help get Chinese-A shares off to a “good start” after the holiday.
China’s COVID situation also cheered investors, after the Center for Disease Control and Prevention said critically ill cases in China are down 72% from a peak early this month.
Foreign investors extended their buying spree in China stocks to a 14th session on Monday, with net purchases of 18.6 billion yuan ($2.76 billion) via the Stock Connect scheme.However, the CSI 300 Real Estate Index lost 2.1% and the Hang Seng Mainland Properties Index plunged 4.7%, respectively. Residential sales in 40 major cities declined 14% from a year earlier during the Lunar New Year week ending Jan. 27, according to China Real Estate Information Corp.
Comments
Comments are closed.