The Chinese stock market (CH50) rallied on Wednesday after the economic reopening finally filtered through to the numbers.
CH50 – Daily Chart
The China blue-chip 50 indexes found support at the 13,300 level, which I noted previously, and now has a platform to push higher.
Goldman Sachs said of the data: “The China NBS purchasing managers’ indexes (PMIs) survey suggested manufacturing activity improved significantly in February. The NBS manufacturing PMI headline index jumped to 52.6 in February from 50.1 in January, the highest reading since April 2012”.
Traders cheered the first real sign that the end of the covid lockdowns is boosting the economy.
“Both the NBS and Caixin manufacturing PMIs reported expansion in new orders and output, stronger new export orders, and faster suppliers’ delivery. Both manufacturing supply and demand expanded in February, as production quickly normalised, and domestic and external demand improved after the Covid policy change,” Goldman analysts added.
Investors had been cautious about Chinese stocks after a recent pullback in US indices and some tense relations between the US and China. Still, today’s data could see investment flows return to a reasonable level. US-listed Chinese stocks staged a rally in premarket trading to shake off a recent slump. Alibaba surged 6%, Bilibili was up 9%, and XPeng jumped 7.4%.
