Chinese stocks have soared after China's government announced a campaign to vaccinate the elderly on Tuesday.

Hong Kong's Hang Seng Index rose 5.2 percent.

The Hang Seng Tech Index, which tracks technology companies, rose even more at 7.7 percent.

In particular, stocks of companies that do business with Chinese consumers, such as the e-commerce group Alibaba, the food delivery service Meituan and the insurer Ping An, rose by double-digit percentages.

Henrik Ankenbrand

Economic correspondent for China based in Shanghai.

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The reaction of the stock exchanges is an expression of hope that after nationwide protests, the end of China's zero-Covid policy is imminent.

This had severely affected economic life with nationwide lockdowns, travel restrictions and daily mass tests, some of which lasted for months.

The stock market traders' imagination was primarily stimulated by a press conference by the National Health Commission, at which the government announced that it intended to increase the vaccination rate for over 80-year-olds.

The fact that this has been so low so far is considered one of the main reasons for Beijing's radical zero-Covid policy, which aims to break the chain of infection.

However, the fact that the markets are now reacting so optimistically to the vaccination campaign announcement does not mean that China is actually ending the zero-Covid policy.

In the past few weeks, investors have repeatedly bought heavily after rumors of an imminent reopening of the country, only to later have to experience another fall in prices.

According to the Beijing analysis house Gavekal Dragonomics, which has distinguished itself with rather sober and conservative predictions during the pandemic, the restrictions in many areas of the country are likely to increase rather than decrease in the coming weeks in order to prevent a further rapid increase in the number of cases.

Warnings from the embassies of the USA and Singapore to their nationals in China also point in this direction,

Gavekal Dragnomics is also of the opinion that the unusually violent popular protests against the zero-Covid policy and, as a result, also against the Communist Party and state leader Xi Jinping will personally persuade Beijing to rethink.

However, the analysts are convinced that a reopening will be chaotic.

Therefore, the chaos that has been evident in recent weeks will continue in the coming months and weigh on consumer sentiment.

The logistics chains and transport routes would also be further affected.