Beijing’s change of heart on street vendors sparks stock market frenzy as traders predict surging demand for vans, kitchenware, umbrellas
- Investors believe products of use to hawkers, like vans and umbrellas, will be in high demand after the government signalled its support for stall owners
- Beijing is now touting tiny street vendors as vital to a floundering economy, a dramatic U-turn from its previous attitude
China’s street vendors are officially flavour of the month, and the share prices of related companies reflect their new-found status.
A policy U-turn by the Chinese government to support the tiny retailers it now regards as the lifeblood of the economy has sparked a stock market frenzy. Investors believe there will be a run on things the average street-level entrepreneur might need, such as vans from which to sell their wares, frying pans to prepare delicious snacks, and umbrellas to protect them come rain or shine.
Consequently, shares of companies from vehicle makers to kitchenware and umbrella producers are skyrocketing.
Chinese premier Li Keqiang lit the fuse when he visited a street stall selling spicy chicken in the eastern province of Shandong on Monday, and praised street hawkers for being an important source of jobs that should be supported by the country.
Hawkers and small shops make up “the liveliness of China, as much as the bigger and higher-end businesses,” said Li, according to state media. His comments stood in sharp contrast with the government’s previously harsh attitude towards such vendors, and came as Beijing seeks to create new jobs and shore up an economy hammered by the Covid-19 pandemic.
“In the short-term, the ‘street vendor economy’ will be the focus of the market,” said Yang Delong, chief economist at Shenzhen-based First Seafront Fund Management. “It’s part of the government’s measures to tackle weak consumption.”
