Chinese shares rebound as investors gain confidence

China's shares rose 1.4 percent on Friday as investors' confidence strengthened in the wake of the yuan revaluation, supporting blue chips such as top listed lender Merchants Bank Co Ltd. The benchmark Shanghai composite index stood at 1,1117.548 points at noon, after sliding 0.5 percent on Thursday. "Yesterday's dip was mostly technical," said PEI Xiaoyan, an analyst with United Securities.
"The market bounced right back in the morning." Merchants Bank was among the most actively traded stocks in the morning. It gained 2.4 percent to 6.82 yuan. Smaller rival Minsheng Banking Corp surged 4 percent to 5.47 yuan. China United Telecommunications Corp Ltd, the smaller of the country's two mobile phone operators, ended the session up 1.4 percent at 2.82 yuan.
Analysts now expected a sustained upturned as investors seemed to have regained some much-needed confidence since Beijing appreciated the yuan 2.1 percent on July 21 a move seen as boosting corporate buying power and domestic consumption in the long run.