Covid Zero Returns

A city near Beijing that was rumored to be a test case for China dispensing with all virus restrictions has suspended schools, locked down universities and asked residents to stay at home for five days, a potential sign officials are reverting to tighter Covid Zero curbs as cases multiply. Shijiazhuang — a city of some 11 million people about 186 miles (300 kilometers) from the capital — has forbidden residents in areas deemed high risk from leaving their homes. The move came just over a week since China issued a suite of guidelines aimed at making its Covid approach more targeted. The report coming from Beijing of two more Covid deaths also stoked fears over the return of tougher restrictions. 

Macron vs Russia

President Emmanuel Macron accused Russia of a “predatory” strategy to fuel anti-French sentiment in Africa, where France has suffered military setbacks and lost influence in recent years. Speaking to TV5 Monde while in Tunisia for a summit of French-speaking nations, Macron noted that three quarters of the people living in the African continent today are less than 25 years old, meaning they never knew French colonization. Still, the past is being “used by multiple foreign powers, which try to use their influence,” the French leader said. Macron is trying to counter Russian influence in Africa, including efforts to link this year’s food crisis to European sanctions.

No New Deal

The UK isn’t seeking a Swiss-style relationship with the European Union, Rishi Sunak’s government said, pushing back against a Sunday Times report that his administration is exploring an option that would anger many in his party. The paper said senior government figures plan to put Britain on a pathway to closer economic ties with the bloc, akin to those enjoyed by Switzerland, over the next decade. Switzerland is a member of the European Free Trade Association, which participates in the single market for most goods. But it also has to accept free movement of labor, EU market regulations and makes annual payments to the bloc’s budget — all of which are red lines to hardline Brexiteers on the right of Sunak’s Conservative Party.

Drained

Cryptocurrency prices struggled Monday in the ongoing crisis sparked by the downfall of Sam Bankman-Fried’s once powerful FTX empire. The largest token Bitcoin fell for two days, along with second-ranked Ether and meme token Dogecoin — an arbiter of the most speculative animus in an already racy digital playground. Administrators are picking over the wreckage of the FTX bankruptcy, discovering that $3.1 billion is owed to top creditors. The scope of the money outstanding is stoking worries that more digital-asset outfits will topple.

Coming Up…

European shares are poised for losses, with worries over China’s Covid policies and global interest rates in focus. Expected data include German PPI. Zoom is scheduled to report earnings with investors expecting further churn among casual customers. Compass Group, Agilent and Dell Technologies also deliver results.

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(Source: Bloomberg, Nov. 21-2022)