According to South China Morning Post (SCMP) an index tracking the performance of Hainan-based companies rose 14 per cent this month up to March 11th to a 10-month high as China announced new measures to spur Hainan’s tourism industry suffering from coronavirus outbreak.
The Hainan Composite Index, which tracks 26 local companies, has rallied 14 per cent this month up to March 11th to a level not seen since April 30th, according to Wind Information.
In comparison, the CSI 300 Index, which tracks China’s biggest companies on the Shanghai and Shenzhen stock exchanges, rose 0.3 per cent over the same time period.
The Hainan government is leading a working committee with representatives from the civil aviation administrator and China Development Bank to help manage HNA Group after years of debt-funded expansion led to a liquidity crunch, while the coronavirus outbreak slammed the airline business, one of the group’s biggest assets.
The government’s management of credit risks in HNA Group is one of the reasons for the rally, according to Wang Jianhui, general-manager of the research department at Capital Securities based in Beijing.
“The gain is also related to the improved coronavirus situation in the province.”
Hainan leads the nation on the epidemic situation, with no reported infections since February 19th, allowing companies to resume production faster than in other affected regions.
Haikou-based Hainan Airlines said this week it will resume all flights into Hainan from Chinese cities from March 15th.
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