Stocks in mainland China advanced on optimism policy-easing measures will help shore up economic growth and fuel risk appetite. Equities in Hong Kong and other Asian markets slipped. The Shanghai Composite Index added 0.8 per cent to 3,569.91 at the close in addition to a 0.6 per cent gain on Monday, the first back-to-back gain this year. China Shenhua Energy and PetroChina jumped 3.3 per cent, pacing a rally in an index tracking energy producers and coal miners. China’s central bank on Monday lowered the rate on medium-term lending facility (MLF), a tool to finance commercial lenders, anchoring expectations for more stimulus to shore up growth. The focus will be on loan prime rates, a key market-based lending rate set on the 20th of every month that was trimmed in December for the first time since April 2020. “The cut [in the MLF rate] clearly sends a signal of easing, which is helpful to lower corporate funding costs and reverse the pessimistic expectations,” said Shen Chao, a strategist at HSBC Jintrust Fund Management in Shanghai. “For the stock market, the cut in the interest rate could reverse the current downtrend.” In Hong Kong, the Hang Seng Index and the tech gauge slipped by more than 0.4 per cent, mirroring a sell-off in regional markets, after yields on US government bonds surged to the highest levels since 2020 amid jitters on interest-rate outlook. Alibaba Group Holding slid 1.6 per cent and Tencent Holdings lost 2.8 per cent. Property stocks bucked the trend, climbing 0.8 per cent on average, the only winning industry subgroup within the Hang Seng Index. Cheaper credit will aid a recovery in China’s home sales. Country Garden and Longfor Group gained at least 2 per cent. The rate cuts appear to extend a policy easing campaign started in December, according to Fidelity International, and more easing could follow. They have been reinforced by other regulatory measures, including a quicker-than-expected decision on gaming licenses for casino operators in Macau, the firm said. Still, Macau casino operators tumbled, surrendering some of the gains sparked by improved regulatory clarity. Sands China slipped 2.9 per cent while Galaxy Entertainment lost 1.3 per cent. Both rallied 23 per cent and 11 per cent each over the past two days. Two stocks started trading in mainland China. Meat processor Jiangsu Yike Food Group surged 212 per cent from the initial public offering price in Shenzhen while Mabwell (Shanghai) Bioscience, which makes antibody drugs, tumbled 30 per cent on Shanghai’s Star Market.