China Covid-19 Outbreak Worsens

Market Update

Asian stocks are mixed on Monday amidst risk-off sentiment as traders evaluated spiking coronavirus cases in China, and a weekend pledge of greater economic support from the People’s Bank of China.

China’s local COVID-19 coronavirus cases crept up again, with most new infections reported in the north-western city of Xian, which has now entered a fifth day of a lockdown.

The data showed that China reported 163 local symptomatic case versus 158 a day prior. In the province of Xian, 150 local cases were support, additionally a new round of citywide testing is scheduled for today.

With the mood one of Caution the S&P 500 is flatlining, while oil prices have dipped, and the greenback is slightly stronger against the euro currency.

Shares fell in Asia are also in the defence, with the Nikkei fluctuating, despite China’s nation’s central bank Saturday pledged greater support for the real economy and reiterated a goal of “healthy” real-estate sector growth. 

This comes amidst widespread worries of China’s Evergrande default, and other large property developers in the world’s second-largest economy.

Reports suggest this morning that China Evergrande has resumed construction work at most of its ongoing projects despite defaulting on a debt payment recently.

Elsewhere in Europe, the German DAX has fallen due to increase COVID-19 restrictions across a number of major European Cities. The German DAX has tumbled around 50 points.

Gold is slightly firmer so far today, while silver has dropped this morning following news that Russia has sent back over 10,000 troops from the border of Ukraine.

Overall, its expected to be a very quiet holiday session today, with the focus on Omicron outbreaks and the markets reactions to China’s central banks latest pledge for support over the weekend.