U.S.-listed shares of Chinese internet and electric-vehicle stocks are enjoying a sharp rally yet again in premarket trading Monday amid reports that officials in the country were easing pandemic restrictions.
China is easing some of the world’s most stringent anti-virus controls and authorities say new variants are weaker. On Monday, commuters in Beijing and at least 16 other cities were allowed to board buses and subways without a virus test in the previous 48 hours for the first time in months. Industrial centers including Guangzhou near Hong Kong have reopened markets and businesses and lifted most curbs on movement while keeping restrictions on neighborhoods with infections.
See: China begins easing restrictions in Beijing and elsewhere
Hopes for the reopening of the country’s economy helped send Alibaba Group Holding Ltd.’s U.S.-listed shares
BABA,
to their biggest monthly gain in seven years during November, while the Golden Dragon China ETF
PGJ,
enjoyed its largest monthly bump since September 2007.
Among the big premarket gainers Monday are U.S.-listed shares of Bilibili Inc.
BILI,
up 16.8%, iQiyi Inc.
IQ,
up 8.7%, Huya Inc.
HUYA,
up 6.1%, and Baidu Inc.
BIDU,
up 4.9%. American depositary shares of Alibaba and JD.com Inc.
JD,
are each up 4.8%.
U.S.-listed shares of Chinese electric-vehicle companies joined in Monday’s sharp premarket rally, with Nio Inc.
NIO,
up 8.0%, XPeng Inc.
XPEV,
up 14.9%, and Li Auto Inc.
LI,
up 5.6%.
A relaxation of China’s COVID-19 rules could benefit U.S. companies as well. Apple Inc., for one, has warned that production disruptions in China could impact iPhone 14 Pro shipments for the current quarter, and analysts are wondering how that dynamic will play out during the critical holiday selling season, and into next year.
Read: Foxconn COVID-hit plant back at full production in late December or early January, report says
The Wall Street Journal reported over the weekend that Apple “has accelerated plans” to move some of its production outside China, to India and Vietnam.
“The shift out of China will not be easy and [will] come with clear logistical, engineering, and infrastructure hurdles,” Wedbush analyst Daniel Ives wrote in a Sunday note to clients.
Source: https://www.marketwatch.com/story/nio-alibaba-bilibili-among-china-stocks-set-for-another-rally-as-covid-controls-ease-11670245594?siteid=yhoof2&yptr=yahoo