Shanghai Stock Exchange Photo:CFP

China’s benchmark Shanghai Composite Index jumped 1.16 percent in a big rally at opening of trade on Thursday, as investors felt encouraged by a shift in local governments’ coronavirus management measures with a focus on a more scientific and flexible approach.

The rally was strong and almost across the board. At around 9:50 am, the tech-heavy ChiNext board climbed back above 2,400 points with a 2.33 percent rise. The Shenzhen market was also up more than 2 percent by the time.

Consumerand tourism stocks, which have been burdened by the coronavirus situation for an extended period, both jumped on Thursday. Liquor stocks jumped 3.47 percent with two companies seeing share trading touch the trade limit of 10 percent as of 9:54 am, while the tourism and hotel shares rose 1.41 percent at the same period.

Hong Kong’s benchmark Hang Seng Index had also climbed by 1.53 percent as of 10: 11 am.

The leap on the stock markets came as officials signaled a new approach to coronavirus prevention methods that are more precise and flexible instead of large-scale lockdowns in accordance with the newly released "20 measures."

On Wednesday, Guangzhou in South China's Guangdong Province, which has been hit by a severe resurge of coronavirus cases recently, refined its COVID-19 prevention measures by announcing it will lift temporary restrictions in some regions and officially allow qualified close contacts to undergo home based quarantined.

Many other cities including Beijing, Chongqing and Zhengzhou also issued optimized measures based on the epidemic situation, allowing people to resume their daily lives in a structured way.

Multiple shopping malls in Beijing, including Beijing Raffles City, said that they were reopening to the public as of Thursday, the Beijing Daily reported.

Some shopping malls in Guangzhou’s Tianhe district also announced that they would no longer require patrons to present a 48-hour negative nucleic acid test reports upon entry to malls.

Another reason behind the rebound is the signal sent by US Federal Reserves that the US might soon slow efforts to raise interest rates for combating inflation, market observers said.

US Federal Reserve Chairman Jerome Powell confirmed on Wednesday that he sees the central bank is in position to reduce the size of rate hikes as soon as next month, CNBC reported.

The yuan’s central parity rate against the US dollar rose 544 basis points to stand at 7.1225 on Thursday.

Global Times