Date
26 March 2017
The Shanghai Composite closed 5.3 percent higher, with all of the gains coming in the last 45 minutes of trading. Photo: Reuters
The Shanghai Composite closed 5.3 percent higher, with all of the gains coming in the last 45 minutes of trading. Photo: Reuters

China stocks surge in late trading to halt five-day rout

China’s stocks rallied on Thursday, ending the benchmark index’s steepest five-day rout, amid speculation state funds have resumed buying.

The Shanghai Composite jumped 5.3 percent to 3,083.59 at the close, with all of the gains coming in the last 45 minutes of trading, Bloomberg News reported.

About 13 stocks rose for each that fell, with financial shares surging the most in a month. The Shanghai index tumbled 23 percent to an eight-month low in the past five days.

Hong Kong’s Hang Seng Index ended 3.6 percent percent higher at 21,838.54. The H-share index also surged 4.62 percent to close at 9,863.61.

Reuters said the markets were also helped by a strong rebound on Wall Street on expectations that the US Federal Reserve will respond to days of China-led volatility by delaying an expected interest rate rise next month.

“Heavyweight stocks like banks and insurance companies helped pull up the index, and it’s possibly China Securities Finance entering the market again to shore up stocks,” Bloomberg quoted Zhang Gang, a strategist at Central China Securities Co. in Shanghai, as saying.

A gauge of 50-day volatility on the Shanghai measure surged to its highest level since 1997 this week amid signs the government had pulled back from rescue measures to support the world’s second-largest stock market.

The index tumbled 42 percent from its mid-June peak through Wednesday to erase more than US$5 trillion of value as margin traders closed out bullish bets and concern deepened that valuations are unjustified by the weak economic outlook.

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CG

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