Asian shares rise as jitters over China protests subsides

The market rebound comes as police in China move against COVID-related protests that erupted in multiple cities.

Asian shares have regained ground as investors’ jitters over protests against “zero-COVID” measures in China subside.

Hong Kong’s Hang Seng on Tuesday jumped 4 percent to 17,981.31, while the Shanghai Composite added 2.3 percent to 3,148.17.

China’s property-related shares also received a boost from a decision by the securities regulator to lift a ban on equity refinancing for listed property firms.

Australia’s S&P/ASX 200 gained 0.3 percent to 7,249.80 and South Korea’s Kospi added 0.8 percent to 2,427.13.

Bucking the positive trend, Japan’s Nikkei 225 lost 0.5 percent to 28,016.58 after government data showed that the unemployment rate for October was unchanged from September at 2.6 percent.

The market rebound comes as police in China move against COVID-related protests that erupted in multiple cities and authorities in some areas started modifying harsh COVID-19 restrictions that have fueled the unrest.

Although market sentiment has been weighed down by the recent demonstrations in China, some analysts noted calm could return in coming sessions.

“The absence of any clear escalation in protests could aid to bring some calm to markets,” said Yeap Jun Rong, market strategist at IG.

The world’s second-largest economy has been stifled by a “zero-COVID” policy which includes lockdowns that continually threaten the global supply chain.

Analysts at Nomura said their index of lockdowns now showed that the equivalent of 25 percent of China’s GDP was affected, compared with a previous peak of 21 percent last April.

Stephen Innes, managing partner at SPI Asset Management, said business was returning as usual, although the heavy police presence may unnerve a Western audience.

“Chinese markets are rallying early in the session as local investors take a more pragmatic approach to the current COVID proceedings. Indeed, a probable outcome is a quicker loosening of restrictions once the current COVID wave and numerous protest flash points subside,” he said.