A resurgence of Covid in China has put a spanner in the works for the big Asia reopening story. Many investors had bid up Asian stocks and Asia-focused funds and investment trusts in recent weeks in anticipation of the Chinese government taking a softer approach to dealing with the coronavirus.

There had been reports of a March 2023 exit plan which could see the introduction of a less stringent policy, with China having already relaxed several Covid measures for international travellers earlier in November.

Greater freedom for people to move around China would benefit multiple industries, hence why Hong Kong’s Hang Seng index jumped 25% in value between 31 October and 15 November.

News that China had suffered its first coronavirus death in six months caused the Hang Seng to retreat more than 3% over two trading days (21-22 November).

What happens in China matters a lot to the global commodities market as the country is such a big importer of oil, gas, coal and metals. It is also a key market for many luxury goods companies who sell products to consumers in this country.

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