Chinese stock market opens low on omicron fears
Published: Nov 29, 2021 11:40 AM
Photo: Xinhua

Photo: Xinhua

China's major A-share market opened low on Monday over concerns relating to the newly discovered omicron coronavirus which drove Friday's big sell-off in the US and European stock markets as investors fret amid renewed uncertainty.

The benchmark Shanghai Composite Index fell 0.99 percent, the Shenzhen Component Index was down by 0.96 percent while the NASDAQ-style dipped 0.38 percent.

The new variant of coronavirus sank the aviation sector drastically listed in the Hong Kong bourse. China Southern Airlines tumbled nearly 5 percent, Air China down by 4.71 percent and China Eastern Airlines down by 3.5 percent.

Firms that are related to coronavirus testing and virus combat, however, saw collective rise at Monday's opening. 

Shares of Hong Kong-listed CanSino Biologics jumped 9.46 percent at the opening following the vaccine maker said it is now monitoring the omicron variant, and is collecting and analyzing new data.

Despite a new potential chapter in the global pandemic, China's A-share market may be relatively more resilient than overseas markets, and policy expectations of stable internal growth may be a more critical factor dominating market performance, the latest research note from Chinese investment bank CICC noted.

The new variant, which has been called by some Western media as the "worst" new variant of COVID-19, has prompted Germany, Italy and Britain to suspend travel from South Africa, where the variant was first detected, while the European Union is also proposing prohibiting travel from the country and its neighbors, according to media reports.

The domestic stock market may experience increased volatility over the short term, but there may be no need to be overly pessimistic. The end of the year and the beginning of next year may be an important window for strengthened policy, it noted.

The US and European stock markets fell sharply on Black Friday. The Dow Jones Industrial Average dropped about 905 points, or 2.5 percent, marking its worst day of the year, while the S&P 500 and NASDAQ Composite slid 2.3 percent and 2.2 percent, respectively.