JP Morgan report helps Shanghai index rise most in 4 months
Mainland stocks yesterday rallied the most in four months as a JP Morgan report saying Beijing is mapping a multibillion-yuan economic stimulus package sparked a buying frenzy.
The Shanghai Composite Index surged 178.813 points or 7.63 per cent to close at 2,523.282. It was the biggest gain since April 24, when a cut in stamp duty sparked an across-the-board buying euphoria, driving the benchmark up 9.29 per cent.
Analysts warned that the market could still slide if the economic sweetener did not materialise in the near future.
Despite the run-up, Shanghai remains the worst-performing market in the world, having fallen 52.07 per cent this year.
Frank Gong, the chief China economist at JP Morgan, wrote in a research note that Beijing was 'considering an economic stimulus package of at least 200 billion yuan (HK$227.86 billion) to 400 billion yuan' to reinvigorate the economy.