China’s COVID surge hits Beijing trading floors, Shanghai finance hub

SHANGHAI, Dec 19 (Reuters) – COVID-19 is sweeping via buying and selling flooring in Beijing and spreading quick within the monetary hub of Shanghai, with sickness and absence thinning already gentle commerce and forcing regulators to cancel a weekly assembly vetting public share gross sales.

Many banks and asset managers have dusted off plans devised to deal with earlier COVID crises, injecting one other layer of unpredictability into foreign money and inventory markets, the place the outlook is clouded by a rocky exit from strict well being curbs.

With mass testing halted after abruptly dropped its zero-COVID coverage earlier this month, official information not reliably seize new case numbers. Inner surveys by a number of large asset managers and banks recommend greater than half of their staff in Beijing, the epicentre of the virus surge, have examined constructive.

“I’d say greater than half of colleagues in Beijing are sick, in contrast with 5%-10% in Shanghai,” mentioned a fund supervisor at PICC Asset Administration, declining to be named as he isn’t authorised to talk to the media.

In China’s interbank market, common day by day yuan/greenback buying and selling quantity fell to about $20 billion final week, the bottom degree since April 2022, when Shanghai was put below a painful two-month lockdown to stop the unfold of the virus.

Inventory buying and selling quantity additionally eased final week. The weekly complete of 139 billion shares traded for the Shanghai Composite (.SSEC) was a bit decrease than the common for the previous three years of about 143 billion.

Most foreign money merchants in Beijing are absent from workplaces, so “buying and selling quantity would naturally fall,” mentioned a dealer at a state-owned lender, talking on situation of anonymity as a result of they don’t seem to be authorised to debate such issues with the media.

The financial institution has requested any worker who lives with folks with fever or has examined constructive to not come to the workplace. “Distant buying and selling would not clear up the issue that you simply’re sick in mattress, and also you even have your loved ones to care for,” the dealer mentioned.

DISRUPTION

The pandemic additionally has an affect on preliminary public choices (IPOs), with the China Securities Regulatory Fee calling off a weekly assembly vetting them final week. It isn’t clear if the assembly might be revived this week.

The Nationwide Bureau of Statistics additionally cancelled a information convention scheduled for November’s financial information.

To make sure, years of strict COVID guidelines have left lots of companies nicely positioned to deal with disruption.

“We journey so much, and we’ve got a number of folks on one IPO venture, so we take turns do the job if one banker is on sick depart,” mentioned one banker at Shanghai-based Haitong Securities, talking on situation of anonymity.

Nonetheless, the state of affairs forward is with out a lot precedent because the virus begins to unfold far and vast.

“We’ve got a backup and restoration catastrophe plan and revived backup workplaces in two places similar to how we did throughout Shanghai lockdown in April and Could,” mentioned a senior dealer at a Chinese language financial institution in Shanghai

“We’re doing every thing we are able to, as this wave of infections and the state of affairs needs to be the worst since first half of 2020.”

Reporting by Samuel Shen, Winni Zhou and Brenda Goh; Enhancing by Tom Westbrook and Kenneth Maxwell

Our Requirements: The Thomson Reuters Belief Rules.