SHANGHAI: China shares ended higher on Monday, rebounding from their biggest weekly loss in a year as investors bought shares bruised by the sell-off, even as slower factory activity growth showed the fragility of China’s economic recovery. The Shanghai Composite index ended up 1.21% at 3,551.40. It fell 5.06% last week, its biggest weekly percentage drop since February 2020.
The blue-chip CSI300 index was up 1.54%, with the consumer staples sector up 1.49% and the healthcare sub-index up 1.32%.
Shares were supported by purchases from foreign investors. Flows through the northbound leg of Stock Connect topped 6.5 billion yuan ($1.01 billion), according to Refinitiv data. Growth in new home prices in China eased slightly in February as demand slowed over the Lunar New Year and some major cities clamped down further on speculative buying. The real estate index rose 0.98%, with analysts expecting home price growth to maintain a steady upward trend.
The rare earth index jumped 6.64% after China’s industry minister said on Monday that China’s rare earths are underpriced due to vicious competition. The smaller Shenzhen index ended up 2.38% and the start-up board ChiNext Composite index was higher by 2.767%. Analysts at UBS said downside risks to the market are “manageable” after last week’s fall.
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