Stock prices displayed inside the trading gallery of the RHB Investment Bank Bhd. headquarters in Kuala Lumpur, Malaysia, on November 21 2022. Picture: Samsul Said/Bloomberg— Stocks and oil slid sharply on Monday as rare protests in major Chinese cities against the country's strict zero-Covid-19 curbs raised worries about management of the virus in the world's second-largest economy.
“The market does not like uncertainties that are difficult to price and the China protests clearly fall into this category. It means investors will become more risk-averse,” Gary Ng, Natixis economist in Hong Kong told Reuters. South Korea's Kospi 200 index retreated 1.35% in early trade and New Zealand's S&P/NZX50 index was off 0.42%.The bigger worries about China's Covid-19 policies dwarfed any support to investor sentiment from the central bank's 25 basis point cut to the reserve requirement ratio announced on Friday, which frees up about $70bn in liquidity to prop up a faltering economy.
“There is a tail risk that the road to living with Covid-19 is too slow, surging Covid-19 cases fuels more protests and social unrest further weakens the economy are market concerns,” said Robert Subbaraman, Nomura's Asia ex-Japan, chief economist. US crude dipped 2.81% to $74.14 a barrel and Brent crude fell 2.57% to $81.48 per barrel, as the Covid-19 protests in top importer China fuelled demand worries.