Hong Kong stocks fall 3% on China unrest, oil drops to lowest in 2022

China’s reduction in reserve requirements won’t make much of a difference with Covid rules still in place, analysts say

China’s latest move to cut the reserve requirement ratio for banks by 25 basis points will have little impact on its economy without a radical change to its strict Covid restrictions, according to the Economist Corporate Network.

Mattie Bekink, China director of the organization, said on CNBC’s “Squawk Box Asia”. “

Bekink highlighted how sensitive investor sentiment has already affected markets.

“We’ve already seen markets move quite significantly based on basically rumors that Beijing was going to relax – that was just a few weeks ago,” he said.

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“The furors seem endless and unrelenting,” Bekink said.

— Jihye Lee

Other currencies also at risk due to China unrest: Standard Chartered

According to Standard Chartered, global currencies will risk weakening along with the offshore Chinese yuan amid unrest in China over its zero-Covid policy because of how supply chains could be affected.

“The key question for how the world reacts is how the Chinese supply chain responds,” Steven Englander, managing director of Standard Chartered Bank, said on CNBC’s “Squawk Box Asia.”

“If it becomes more disruptive, I think it’s a risk-off thing,” he said. “Not only CNH, but other currencies will be at risk.”

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Englander added that traders may be looking to reduce their exposure to more risk.

— Jihye Lee

Oil prices slide as China’s Covid protests continue

Crude oil futures slipped early in Asia as high Covid cases, virus restrictions and unrest in China raised fears over demand from the world’s second-largest oil consumer.

West Texas Intermediate futures flow 0.35% to $ 76.01 per barrel, while Brent crude futures lost 0.26% to $ 83.41 per barrel.

Oil prices saw sharp falls last week as “the shutdown in China raised concerns about demand,” ANZ Research’s Brian Martin and Daniel Hynes wrote in a note Monday.

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“This remains a headwind for oil demand,” they said, adding that the impact of rising Covid was also reflected in China’s mobility data.

— Abigail Ng

Chinese yuan weakens in Asian morning as Covid protests persist

The offshore Chinese yuan has weakened sharply against the US dollar amid negative sentiment over unrest in China over Covid restrictions.

The currency weakened around 0.8% against the US dollar to 7.2529 in Asian morning trade.

There dollar index rose 0.32% to 106.29, and investors are likely to see the greenback as a safe asset as concerns about China grow.

— Jihye Lee


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