Market Wrap: Global Stocks Rally as China Eases Covid Rules

The final week of the year opened with gains across major stock markets in Europe and the United States after the Christmas pause. The Ibex edged up 0.40%, returning to around 8,300 points, while Eurostoxx 50 advanced 0.47%, CAC 40 climbed 0.79%, and Milan rose 0.35%. Most Asian markets followed suit after China trimmed its zero covid stance, with the Shanghai Composite up nearly 1% and the China A50 index gaining 1.22%. The Nikkei finished the session with a modest 0.16% uptick. Authorities announced plans to end the mandatory quarantine for travelers entering the country on January 8, a policy in place since March 2020. Simultaneously, the National Health Commission declared covid no longer a category A disease, shifting the risk assessment to category B and allowing looser infection controls. The sweeping measures came as public discontent with President Xi Jinping had grown, visible in large protests late last month. The removal of strict epidemic restrictions is expected to support Chinese economic activity while the policy shift has created uncertainty about the near term trajectory of infections.