Mainland stock markets extended gains Wednesday, aided by liquidity unlocked from recent IPOs, as investors took advantage of last week's sell-off to buy relatively cheap shares.

The Shanghai Composite Index jumped 2.48 percent or 113.66 points to 4,690.15 points Wednesday. The Shenzhen Component Index rose 1.66 percent or 266.32 points to close at 16,312.31 points.

The CSI 300 Index of the biggest companies traded in Shanghai and Shenzhen increased 1.96 percent or 94.04 points to 4,880.13 points.

A total of 1.49 trillion yuan ($240.04 billion) changed hands on the two bourses, up from the previous trading day's 1.30 trillion yuan.

Hong Hao, chief strategist with BOCOM International, said that last week's 13 percent slump in Chinese stocks had wiped out excessively leveraged punters in the market, setting the stage for healthier rises.

"Those who bet with the highest level of leverage should be out of the game, and the market is stabilizing. The market uptrend is not changed," Hong said.

The market, which was hit by a big wave of IPOs last week, also benefited Wednesday from some subscription money unlocked from the IPOs, which analysts estimate could be around 2 trillion yuan.

Stocks related to the reform of centrally administrated State-owned enterprises soared Wednesday. COFCO Property (Group) Co, COFCO Biochemical (Anhui) Co, COFCO Tunhe Co and China Meheco Co all surged by the 10 percent daily limit.

The coal sector also outperformed the rest of the market, with China Coal Energy Co jumping 9.97 percent.

ChiNext, the country's NASDAQ-style board for high-tech and emerging start-ups, lost 0.31 percent or 10.54 points to close at 3,383.40 points.

Global Times - Reuters