China Stocks Rise Most in 3 Weeks on Government Support Outlook

By Bloomberg News 

China’s stocks rose the most in three weeks, led by financial and commodity companies, on speculation the government will take steps to bolster equities.

Citic Securities Co. (600030) and Haitong Securities Co. climbed at least 3 percent after the regulator said it may allow more securities companies to conduct asset-backed securities businesses and China National Radio reported the government is studying allowing the housing provident fund to invest in equities. Jiangxi Copper Co. led gains for metal producers as industrial metals advanced. Yunnan Baiyao Group Co. (000538) paced declines among drug companies after a gauge of health-care stocks had the biggest gain among industry groups this year. “Brokerages will have more innovative businesses to develop and they have good earnings prospects going forward,” Wei Wei, an analyst at West China Securities Co. in Shanghai, said by phone today. “Regulators don’t want to see declines in the stock market and these measures are a signal that they still have cards to play.”

The Shanghai Composite Index (SHCOMP) climbed 0.9 percent to 2,313.22 at the close, the most since Feb. 1. The index fell as much 0.1 percent and gained as much as 1.4 percent, with 30-day volatility jumping to the highest level since Jan. 28 at 19.99. Trading volumes were 25 percent lower than the 30-day average, according to data compiled by Bloomberg.

The CSI 300 Index rose 1.1 percent to 2,594.68. The Hang Seng China Enterprises Index (HSCEI) of Chinese companies traded in Hong Kong gained 0.4 percent. The Bloomberg China-US 55 Index (CH55BN) added 0.3 percent in New York yesterday.

To contact Bloomberg News staff for this story: Zhang Shidong in Shanghai atszhang5@bloomberg.net

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