Did Xi Jinping's hiking jaunts boost outdoor apparel firm’s stocks?
When Beijing Toread Outdoor Products, a leading Shenzhen-listed brand, saw a two-day spike in its stock price this week, speculation arose that perhaps the recently revealed hiking trips taken by President Xi Jinping had something to do with it.
News that Xi was an enthusiastic hiker and that he had even become honourary chairman of a hiking club in 2002 while he was provincial head of the southeastern province of Fujian, was widely picked up by major news outlets this week, and generated interest from both bloggers and investors.
Xi befriended some fellow enthusiasts during trips he made to the popular Gushan mountain trail and was eventually invited to head the club, local Fujian news portal fjsen.com reported.
The report said Xi had responded: "Though I don't usually chair any groups or clubs, I am willing to be an honourary chair[man] of the hiking club. By doing so, more people will be encouraged to join hiking and benefit from the exercise."
At the time, Xi also sent a letter to Zhu Shaoming, head of the hiking club, praising it for organising outdoor activities and promoting a healthy lifestyle. It was signed by Xi on August 30, 2002, according to a picture of the letter.
This revelation of Xi's outdoor hobby first came to light on fjsen.com in November, but it only recently sparked mainstream interest. Many now believe interest in the president’s outdoors hobby played a part in Beijing Toread’s stock surge – the same way it was claimed that Xi’s high-profile visit to a bun restaurant helped boost the stocks of an alleged corporate shareholder.
But an analyst cautioned against jumping to conclusions. "China's stock investors rely heavily on rumour and gossip, and this can lead to hype," a Hong Kong-based portfolio manager who declined to be named, told the South China Morning Post on Wednesday.
"It takes more than Xi's personal opinion to convince the Chinese people to embrace outdoor activities," she added, "Infrastructure, personal income and motivation all matter a lot."
"This means there are different players in China's stock market," said a Hong Kong-based fund manager who agreed to speak on anonymity, "Transactions made by hedge funds and day traders could have contributed to this price fluctuation."
Nevertheless, it seems many still choose to link Xi’s steps to the stock market’s up- and downswings.
Right after Xi paid a visit to a Beijing steamed bun restaurant in December, the stock price of of Quanjude, the restaurant chain known for its trademark Beijing roast duck and rumoured to be a shareholder of the bun restaurant, spiked as much as 10 per cent. Yet it was soon revealed that there had been a misunderstanding and Quanjude did not hold any shares in the bun shop.