China’s COVID surge hits Beijing trading floor, Shanghai financial hub

SHANGHAI: COVID-19 has swept Beijing’s trading floor and is spreading rapidly in Shanghai’s financial hub.Illness and absence have dampened already light trading, prompting regulators to hold weekly meetings to review public stock sales. I am forced to cancel.

Many banks and asset managers have brushed off plans devised to deal with previous COVID crises, injecting a new layer of unpredictability into currency and stock markets.

Mass testing halted after the abrupt withdrawal of the zero-COVID policy earlier this month has prevented official data from reliably capturing the number of new cases. More than half of employees in Beijing, the epicenter of the surge, have tested positive.

A fund manager at PICC Asset Management said, “I would say that more than half of my colleagues in Beijing are ill, compared to 5% to 10% in Shanghai.”

In China’s interbank market, the average yuan/dollar trading volume fell to about $20 billion last week, the lowest since Shanghai was put into a painful two-month lockdown in April 2022 to prevent the spread of the virus. was the lowest level.

Equity trading volumes also eased last week. His 139 billion shares traded weekly on the Shanghai Composite were just below the average of about 143 billion over the past three years.

With most of Beijing’s currency traders out of office, “trading volumes will naturally decline,” said a trader at a state-owned financial institution, who requested anonymity.

Banks are asking employees who live with anyone who has a fever or who have tested positive to stay out of the office. “Remote trading doesn’t solve the problem of being sick in bed and having to take care of your family,” said the trader.

confusion

The pandemic has also affected initial public offerings (IPOs), with the China Securities Regulatory Commission canceling its weekly meeting to review IPOs last week. It’s not clear if meetings will resume this week.

The National Bureau of Statistics also canceled a press conference on economic data for November.

Indeed, years of strict COVID rules have helped many businesses cope better with the disruption.

A banker at Shanghai-based Haitong Securities, who asked not to be identified, said, “We travel a lot and have multiple people working on one IPO project, so one banker is on sick leave. If they are, we will take turns doing the work.”

Still, the unprecedented situation continues as the virus begins to spread far and wide.

A senior trader at a Chinese bank in Shanghai said, “We have set up a backup and recovery disaster plan and restored backup offices in two locations, similar to what we did during Shanghai’s lockdown in April and May. He said.

“This wave of infections and the situation should be the worst since the first half of 2020, so we are doing everything we can.”