China stocks have lost pandemic reopening gains

The news: Stocks in China have returned to their post-COVID starting point, after today's losses wiped the last of the gains from the nation's reopening rally.

The numbers: The CSI 300 index fell as much as 0.7% in Friday trading to 3,508.22, below its 31 October 2022 close, which preceded a massive three-month, 16% speculative rally as China opened from tough COVID restrictions. The CSI 300 is one of the world's worst performing major indexes in 2023, Bloomberg reports, and is on track for a third straight year of losses.

The context: China stocks have been on a macro downtrend despite a handful of relief rallies since 30 January, as weak domestic demand and a liquidity crisis in the property sector eats at investor confidence. Things were made worse this week by weakness in global equity markets and growth in safe haven assets, spurred by conflict in the middle east and challenging macro conditions.