Why Nike Stock Was Bouncing Higher Today
Shares of Nike (NYSE: NKE) were marching higher Friday as the sportswear giant got some good news out of China. Though there were no company-specific updates, hints that China could soon relax its strict zero-COVID policy, combined with indications that a key issue between U.S. and Chinese securities regulators could be moving rapidly toward a mutually acceptable resolution, sent Chinese stocks soaring Friday. The Hang Seng jumped by 5.3% in its session, and the Shanghai Composite rose 2.4%.
Since China is a key growth market for Nike, the stock responded favorably to the news, and was up 4.5% as of 12:05 p.m. ET.
The optimism about a possible relaxation of China's strict COVID-containment policies seemed to be based mostly on rumors and social media posts. However, Reuters did report that a former Chinese health official told a private conference that significant changes to the zero-COVID policy are set to take place in the next five to six months. That policy has largely held the disease in check in the massive nation, but has been a serious headwind to its economy, particularly in the retail sector. Chinese health authorities have scheduled a news conference on the subject for Saturday at which they could confirm the rumors.
Source Fool.com
