Just how skittish is the market................

a screen shot with no name..................inspires a rally

How a mysterious China screenshot sparked a $696 billion sharemarket rally

ByBloomberg News

November 3, 2022 — 8.17am

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Nobody is quite sure who wrote it, when it was written or if it’s even true. But a screenshot of four paragraphs detailing a China reopening plan was enough for traders to scoop up stocks for two days running.

The unverified post, which contained black characters on a white background with no identifying marks, first began circulating on Monday night in WeChat social messaging groups filled with analysts and fund managers, according to accounts by a dozen investors who asked not to be identified. By the next morning, it was spreading like wildfire.

The screenshot claimed that China’s No. 4 official Wang Huning held a meeting of COVID-19 experts at the request of President Xi Jinping to discuss a reopening plan.CREDIT:BLOOMBERG

The screenshot claimed that China’s No. 4 official Wang Huning – one of seven men on the powerful Politburo Standing Committee – held a meeting on Sunday of COVID-19 experts at the request of President Xi Jinping. It called Xi “big boss” and used “WHN” to refer to Wang in a bid to sidestep censors, who strictly manage messages and social media posts on China’s political elite.

Representatives at the meeting, which included members of the economic and propaganda departments, discussed “speeding up a conditional opening plan, with the goal of substantially opening by March next year,” it said.

The post gained more traction when it was shared at 11:26 am by “96 Old Stock Trader” on Xueqiu, a Chinese-language financial platform. Less than 20 minutes later, prominent Hong Kong-based economist Hong Hao tweeted something similar – and stocks in the MSCI China Index were well on their way to a $US320 billion ($503 billion) rally. More gains on Wednesday brought the two-day total to $US450 billion ($696 billion).

Even a fresh reaffirmation of the COVID Zero policy by the China National Health Commission late Wednesday failed to dampen traders’ enthusiasm. US-listed China stocks kept rallying after the commission asserted that the country would “firmly adhere” to its fight against the disease.

Investors have been looking for reasons to scoop up Chinese stocks, which are among the worst performers in the world this year as the economy grows near the slowest pace in four decades. Equities saw a historic rout last week after Xi consolidated power in a twice-a-decade personnel reshuffle, and the yuan weakened to a 14-year low.

COVID lockdowns, weak consumption and an ailing housing sector have all clouded the investment outlook in China. And now that Xi has put his allies in key positions, hope is building for steps to boost the economy at the next annual session of China’s legislature in March.