China Stocks Surge: Regulator Support Fuels Market Rebound

China's stock market experienced significant gains as regulatory bodies promised more support to combat the market downturn. The Shanghai Composite and CSI300 indices saw their best single-day performance in months, driven by optimism over potential regulatory measures and a recovery in local chip stock amidst U.S. tech curbs.

On Tuesday, China's stock market observed its most significant rally in over two months as regulators assured increased support to tackle the market downturn. Local chip companies also experienced a boost following the U.S.'s enhanced technological restrictions.

The Shanghai Composite index experienced a 2.5% rise, closing at 3,240.94, while the CSI300 index gained 2.6%, marking their best performance since November 7. Additionally, the Hang Seng Index in Hong Kong rose by 1.8%, rebounding from a four-month low, and the technology index increased by over 3%.

Optimism surged as Beijing promised further measures to bolster weak markets and economic growth amid a challenging New Year start. Stock market stability will be prioritized in 2025, with the China Securities Regulatory Commission indicating comprehensive efforts to foster upward momentum. Meanwhile, the People's Bank of China aims to improve the relending and funding scheme from last year and stabilize the RMB's exchange rate.

(With inputs from agencies.)