SHANGHAI: Mainland China stocks extended gains on Thursday and were set for a seventh straight winning session, as investors cheered a report that further stimulus could be rolled out to arrest a slowdown in the world’s second-largest economy.
China, HK stocks extend gains as massive stimulus boosts sentiment
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Hong Kong markets followed suit in the morning trade.
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Beijing was considering injecting up to 1 trillion yuan ($142.48 billion) of capital into its biggest state banks to increase their capacity to support the struggling economy, after it unveiled earlier this week its biggest stimulus since the pandemic, according to a report citing unnamed sources.
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“Although these measures will not fundamentally reverse the low appetite for credit in the economy, they will at least bolster lending in support of public investments,” Tianchen Xu, senior economist for China at EIU said in a note. “The actions demonstrate that the government is willing to take proactive measures to support growth, rather than tightening for the sake of defusing systemic risk.”
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At the midday break, the Shanghai Composite index was up 0.64% at 2,914.74 points, while the blue-chip CSI300 index climbed 0.71% to 3,425.66 points.
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The biggest winners in morning deals were the consumer staples and real estate shares, with gains of 3.42% and 3.19%, respectively.
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Chinese H-shares listed in Hong Kong rose 2.77% to 6,952.79 points, while the Hang Seng Index was up 2.32% at 19,572.45 points.
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The smaller Shenzhen index was up 0.57%, the start-up board ChiNext Composite index was weaker by 0.22% and Shanghai’s tech-focused STAR50 index was up 0.13%.
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Around the region, MSCI’s Asia ex-Japan stock index was firmer by 1.07% while Japan’s Nikkei index was up 2.30%.
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So far this year, the Shanghai stock index is down 2% and the CSI300 has fallen 0.2%, while China’s H-share index listed in Hong Kong is up 20.5%. Shanghai stocks have risen 2.55% so far this month.
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