China stocks reach a nine-month high as bull run shows no sign of tiring out
- Shanghai Composite closes up nearly 1.6 per cent, at its highest level since May 23 of last year
- But can it keep on rolling? That’s the big question
China stocks reached a nine-month high on Wednesday on further news of government policies to boost a slowing economy, despite awaiting progress on the trade war.
The Shanghai Composite closed up 1.57 per cent, or 47.85 points, to 3,102.10, its highest level since June 7, 2018. The CSI 300 rose 0.84 per cent, or 32.08 points, to 3,848.09, its highest since May 23, 2018.
Wednesday trading started tepidly as concern over a lack of a trade deal dampened reactions to an initial set of economic policies announced, including tax cuts, on the first day of Beijing’s annual political summit known as the “Two Sessions.”
But then Shanghai took off again after more policies were announced by Ning Jizhe, vice chairman of the National Development and Reform Commission (NDRC), aimed at opening up certain sectors as well as boosting domestic consumption.
Gordon Tsui, managing director of investment holding company Hantec Pacific, said markets were buoyed by supportive policies out of the gathering, which ends next week.
“At least it is a strong signal that the government will use different means, like fiscal policy and the reduction of tax, to push the business of some industries and support the consumption sector,” he said. “They understand the trade conflict will slow down. However, they are expecting other conflicts, like IP [intellectual property] and technology issues. They have to implement some solid policy or measures to support economic growth.”