Chinese Stock Markets Surge Amid Beijing's Economic Boost

Stock markets in China and Hong Kong rallied on Thursday, driven by gains in the property sector and bolstered by Beijing's promise of additional policy measures. The Shanghai Composite index rose 3.6%, and the CSI300 increased by 4.2%. The surge followed announcements of rate cuts and significant funding for markets.

Stock markets in China and Hong Kong soared on Thursday, driven by gains in the property sector and bolstered by Beijing's pledge of further policy measures to stimulate growth. This promise comes on the heels of significant rate cuts and additional funding announcements for the markets.

The Shanghai Composite index ended 3.6% higher at 3,000.95 points, while the blue-chip CSI300 Index rose by 4.2% to 3,545.32 points. Both indexes achieved their highest closing levels since June, marking the seventh consecutive winning session.

Chinese H-shares in Hong Kong surged by 4.28%, while the Hang Seng Index climbed 3.67%. The rally followed state media reports from a Politburo meeting, indicating that China aims to enhance fiscal and monetary policy adjustments and meet full-year economic and social development targets. Additional boosts came from a Bloomberg News report suggesting that Beijing may inject up to 1 trillion yuan into state banks to support the struggling economy.

Analysts at UBS noted that bearish investors might shift to neutral positions or invest in stock options. Goldman Sachs observed long-only funds and hedge funds were active, particularly in consumer discretionary and financial sectors, which were the day's primary gainers. The smaller Shenzhen index rose 3.76%, the ChiNext Composite index jumped 4.42%, and the STAR50 index rallied 3.87%.

According to Tianchen Xu, senior economist for China at EIU, these measures are unlikely to fundamentally change the low appetite for credit but will bolster lending for public investments. The actions reflect the government's proactive stance on supporting growth.

(With inputs from agencies.)