China To ‘Resolutely Adhere’ To Covid Zero As Cases Rise
(Bloomberg) -- China's top health body said the nation's zero-tolerance approach remains the overall strategy to fighting Covid-19 after unverified social media posts buoyed hopes the policy would be eased.
The National Health Commission convened a meeting hosted by party chief Ma Xiaowei on Wednesday to study the messages delivered during the party congress held last month. Ma said that officials must be committed to Covid Zero and the work of controlling the virus, according to a statement from the commission.
“We must resolutely maintain the general approach of ‘preventing imported cases and domestic resurgence' and the overall strategy of ‘dynamic Covid Zero',” Ma said in the meeting, according to the statement.
China reopening stocks slid, with restaurants including Jiumaojiu International Holdings Ltd. and Yum China Holdings Inc. down more than 10%. Airline stocks traded across Hong Kong and China also edged lower.
China Stocks Slide on Covid Zero Adherence, Hawkish Fed Comments
China's CSI 300 Index fell 0.2% as of 9:48 a.m. local time, paring earlier losses of up to 1%. A gauge of Chinese shares listed in Hong Kong was down 1.4%, paring earlier losses of up to 2.5%.
In the meeting, Ma also said outbreaks need to be controlled in the shortest amount of time with the lowest cost, repeating a slogan popularized by President Xi Jinping, who secured a third term in power at the party congress, during which he defended Covid Zero as a strategy that has saved lives.
China reported 3,133 new cases for Wednesday, the most in more than two months. Hotspots include Xinjiang and Guangdong, while local cases nearly tripled in Inner Mongolia to 932 on Wednesday from 320 on Tuesday.
The National Health Commission meeting came after posts circulated on Chinese social media on Tuesday and Wednesday claiming that the country was studying ways to exit Covid Zero sparked a $450 billion rally in the MSCI China Index.
Read more: How a Mysterious China Screenshot Spurred $450 Billion Rally
US-listed China stocks continued to climb even after the commission's statement, with the Nasdaq Golden Dragon China Index rising as much as 4.5% in Wednesday trading, before paring gains close 0.9% higher.
While investors and the public are hoping for a shift from Covid Zero, lockdowns, mass testing and centralized quarantine in China show no sign of slowing. Zhengzhou's Airport Economy Zone, the district where the world's largest iPhone factory is located, was shut down yesterday for seven days. The move could complicate recruits and shipments in and out of the Foxconn plant, adding a blow to Apple Inc. during the peak holiday shopping season.
Read more: China Locks Down Area Around ‘IPhone City' in Blow to Apple
(Adds latest case tally in fifth paragraph.)
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