(Bloomberg) -- Chinese stocks listed in the US rose Monday, bucking a broad market selloff, amid stronger-than-expected earnings, newly-announced housing support measures and speculation that nationwide protests could hasten a shift away from Covid Zero policies.

The Nasdaq Golden Dragon China Index closed up 2.8%, compared with a loss of 1.5% in the S&P 500 Index. E-commerce firm Pinduoduo Inc. was the biggest contributor to the gain, rallying 13% after it reported results that beat analysts’ estimates. KE Holdings Inc., a platform that facilitates housing transactions, also rose after the nation’s securities regulator said it will end its ban on local share sales by listed property developers. Both announcements came in after markets in China closed Monday.

The climb in the US stands in contrast to trading in Asia Monday, when Chinese stocks slid on concern about the fallout from protests across China over the weekend in a rare act of defiance against the government.

The civil unrest comes despite Beijing’s loosening of some Covid restrictions earlier this month, which had fueled gains in the Chinese stock market. The MSCI China Index is on pace for its best month this century after gaining nearly 19% in November, though it remains down sharply this year as investors wait for a clear signal that Beijing is softening its zero-tolerance stance toward the pandemic.

Some were also optimistic that nationwide protests could hasten the government’s shift away from the Covid Zero policies that are exerting a major drag on its economy.

While China’s government has deflected questions about the unrest, some localities -- including the capital city of Beijing -- have been paring back restrictions despite surging Covid cases. A local official in the capital said movement restrictions imposed to trace the source of Covid or identify those infected generally must not exceed 24 hours. Meanwhile, Xinjiang said it will lift lockdowns of designated high-risk areas as soon as possible.

“This will likely accelerate reopening” even though “there will be no official end to zero Covid,” Brendan Ahern, chief investment officer at Krane Funds Advisors wrote in a note to clients.

Reopening Trade Is Based More on Hope Than Reality: China Today

Stocks that stand to gain strongly from an end to virus-related lockdowns helped to drive the advance Monday, including online travel agency Trip.com Group Ltd and hotel operator H World Group Ltd.

Yet with the country’s virus caseload spiking and signs of public discontent boiling over, Goldman Sachs Group Inc. economists said China could face a “disorderly” exit from its Covid Zero policies. Mark Mobius, founding partner at Mobius Capital Partners, echoed such caution in an interview with Bloomberg Television, saying Chinese markets could retreat in the near term if Beijing cracks down on protesters.

Although the social tension may help accelerate China’s reopening, “it is undeniably adding another layer of uncertainty for the Chinese market at the moment when most of the investors are re-calibrating their positions in preparation for 2023,” said Xiadong Bao, a fund manager at Edmond de Rothschild Asset Management in Paris.

--With assistance from Yiqin Shen and Lynn Chen.

(Updates with more details throughout.)

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