Rise in Covid cases dampen investor hopes in China

Rise in Covid cases dampen investor hopes in China

BEIJING: China's global manufacturing hub became the latest COVID-19 epicentre on Tuesday, which tests Guangzhou's ability to avoid a Shanghai-style lockdown.

Nationwide, new locally transmitted infections climbed to 7,475 on Nov. 7, according to China's health authority, up from 5,496 the day before and the highest since May 1. Guangzhou accounted for nearly a third of the new infections.

The increase was modest by global standards but significant for China, where outbreaks are to be quickly tackled when they surface under its zero-COVID policy. Economically vital cities, including the capital Beijing, are demanding more PCR tests for residents and locking down neighbourhoods and even districts in some cases.

As China's economy rebounded sharply, it could dampen investors' hopes that curbs and restrictions will gradually be eased.

"We are seeing a game between rising voices for loosening controls and rapid spreading of COVID cases," said Nie Wen, a Shanghai-based economist at Hwabao Trust.

Investors see China's battered markets as an attractive prospect as the global slowdown lingers, and have focused on small signs of gradual change — more targeted lockdowns and improvements in vaccination rates.

Guangzhou, the capital of Guangdong province, reported 2,377 new local cases for Nov. 7, up from 1,971 the previous day.

Many of Guangzhou's districts, including central Haizhu, have imposed varying levels of curbs and lockdowns. But, so far, the city has not imposed a blanket lockdown like the one in Shanghai earlier this year.

Shanghai, currently not facing a COVID resurgence, went into a lockdown in April and May after reporting several thousand new infections daily in the last week of March.

In Beijing, authorities detected 64 new local infections, a small uptick relative to Guangzhou and Zhengzhou, but enough to spark a new burst of PCR tests for many of its residents and a lockdown of more buildings and neighbourhoods.

Zhengzhou, the capital of central Henan province and a major production base for Apple supplier Foxconn, reported 733 new local cases for Nov. 7, more than doubling from a day earlier.

In the southwest metropolis of Chongqing, the city reported 281 new local cases, also more than doubling from 120 a day earlier.

In the coal-producing region of Inner Mongolia, the city of Hohhot reported 1,760 new local cases on Nov. 7, up from 1,013 a day earlier.

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