Swiss watch giant Swatch said Tuesday that its revenue growth was limited by China's zero-Covid policy in 2022 but it anticipates strong sales this year following the lifting of restrictions.

Swatch, which also owns the luxury brands Tissot, Longines and Omega, posted net sales of 7.5 billion Swiss francs ($8.2 billion) last year, up 4.6 percent from 2021 at constant exchange rates.

But China's Covid lockdowns caused a sales shortfall of more than 700 million Swiss francs, the maker of colourful watches said in a earnings statement.

The company posted a net profit of 823 million Swiss francs ($894 million) last year, up 6.3 percent from 2021.

"Consistent double-digit sales growth in Europe, America, the Middle East and most of the Asian markets was severely dampened by the significant decline in sales in China," the statement said.

"First the lockdowns, and then the massive Covid wave after the measures were lifted, led to shortfalls of over 30 percent in this (fourth quarter)," it said.

But the group said it expects "strong" sales growth in all regions and segments this year after the end of China's Covid measures, which has already led to a recovery in consumption in the key market.

"The sales growth in January in China reinforces the group's expectation to aim for a record year in 2023," it said.

Stocks mixed as traders balance recession risk, China reopening
London (AFP) Jan 24, 2023 - Stock markets traded mixed Tuesday as investors weighed the chances of a global recession this year.

With China's economy reopening from strict lockdowns, coupled with easing energy prices, there is hope that a severe downturn can be averted even if inflation remains stubbornly high and interest rates look set to keep on rising, albeit at a slower pace.

The eurozone economy grew in January for the first time in six months, a closely watched survey showed Tuesday, raising hopes that Europe will avoid a recession this winter.

The S&P Global Flash Eurozone purchasing managers' index (PMI) rose to 50.2 in January from 49.3 in December. A figure above 50 indicates growth.

At the same time, heavy fallout from lingering high energy costs was further evidenced Tuesday with data showing UK government debt ballooning further in December as it subsidises gas and electricity bills for households and businesses.

"Lower energy prices are helping consumer confidence rebound," noted Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown.

"It's another positive sign for companies fearing the effects of well-flagged interest rate rises, indicating that consumers are showing resilience, but they are still likely to stay cautious."

Tokyo stocks led gains in another day thinned by the Lunar New Year break, with sentiment boosted once more by a surge Monday on Wall Street.

Tech firms provided the support in New York as traders gear up for the release of earnings from big-ticket firms including Microsoft and Intel.

Hopes that the Federal Reserve will slow down its pace of interest rate hikes have also given investors optimism that the US economy could avert a recession, or at least suffer only a mild contraction.

The gains come after markets suffered a wobble last week on worries about a downturn caused by a series of interest rate hikes last year aimed at bringing inflation down from decades highs.

While the year has started on a positive note, BlackRock Investment Institute warned that markets were "vulnerable to negative surprises -- and unprepared for recession".

Oil prices were barely moved after jumping last week to their highest point since November, on demand hopes fuelled by China's reopening.

"Crude prices are wavering as the dollar stabilises and over-exhaustion from China reopening headlines," said Edward Moya, analyst at OANDA trading group.

"This week will learn a lot about the crude demand outlook after we hear earnings from the airlines and Chevron. Oil should be stuck in wait-and-see mode until we learn more about the health and outlook of the US economy."

- Key figures around 0900 GMT -

London - FTSE 100: DOWN 0.5 percent at 7,747.59 points

Frankfurt - DAX: FLAT at 15,103.91

Paris - CAC 40: UP 0.2 percent at 7,047.72

EURO STOXX 50: UP 0.1 percent at 4,154.60

Tokyo - Nikkei 225: UP 1.5 percent at 27,299.19 (close)

Hong Kong - Hang Seng Index: Closed for a holiday

Shanghai - Composite: Closed for a holiday

New York - Dow: UP 0.8 percent at 33,629.56 (close)

Euro/dollar: UP at $1.0878 from $1.0877 on Monday

Pound/dollar: UP at $1.2393 from $1.2374

Euro/pound: DOWN at 87.77 pence from 87.82 pence

Dollar/yen: DOWN at 130.08 yen from 130.66 yen

Brent North Sea crude: UP 0.2 percent at $88.37 per barrel

West Texas Intermediate: UP 0.1 percent at $81.72 per barrel

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