A shares jump as PBC pumps in liquidity

Source:Global Times Published: 2016-5-3 20:43:01

Mainland stock markets rose on Tuesday after China central bank added liquidity to the financial system.

The benchmark Shanghai Composite Index climbed 1.85 percent to 2,992.64 points on Tuesday, while the Shenzhen Component Index finished the day up 2.96 percent at 10,441.92 points.

The CSI 300 Index of the biggest companies traded in Shanghai and Shenzhen increased 1.8 percent to 3,213.54 points.

The ChiNext Index, which tracks the country's NASDAQ-style board for growth enterprises, jumped 3.67 percent to close at 2,217.23 points.

A total of 537.5 billion yuan ($83.04 billion) in shares changed hands on the Shanghai and Shenzhen exchanges on Wednesday.

More than 30 stocks rose to their daily trading limit of 10 percent, and no stocks slumped by the limit.

Stocks related to beverages, audio and visual aids as well as communication services were among the biggest winners of the day.

After a week of volatility leading up to the May Day holidays, mainland stocks were due for a rebound, and government support helped make it happen, Huatai Securities analysts said in a note.

The People's Bank of China (PBC), China's central bank continued to replenish liquidity of the markets by issuing 100 billion yuan in reverse repurchase agreements starting on Tuesday.

Chinese President Xi Jinping also stressed during a meeting on Friday that China's stock markets must develop in a healthy manner, the Xinhua News Agency reported on Friday.

A shares were close to a bottom, said Ren Zeping, a stock analyst from Guotai Junan Securities. The bear market that has gone on for close to a year is nearing an end, so investors should not be too pessimistic at this point in time, Ren said.

Global Times

Posted in: Markets

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