Shares see gains after favorable policies

China’s A-share markets closed higher on Monday, as investor sentiment was lifted by a series of favorable policies.

Boosted by the strong performance of technology stocks, the benchmark Shanghai Composite Index gained 2.21 percent to end the day at 2,915.43 points.

The smaller Shenzhen Component Index rose 3.31 percent to finish at 11,102.15 points, while the ChiNext Index surged 3.43 percent to 2,158.22 points.

Markets saw broad-based gains, with electronics and communications sectors among the top performers. A total of 156 companies saw their shares jump by the daily maximum of 10 percent.

The combined turnover of the two bourses came to 761.5 billion yuan (US$106.7 billion), compared with the previous trading day’s volume of 572.2 billion yuan.

Data released over the weekend by China’s National Bureau of Statistics showed factory activity in the country expanding in May, with the official manufacturing Purchasing Manager’s Index (PMI) coming in at 50.6.

The PMI for the non-manufacturing sector was 53.6 in May, up from 53.2 in April.

The strong rally came after a batch of favorable policies, analysts said.

Last week, China's central bank restarted reverse repo operations and injected a net 370 billion yuan into the market, sending a signal to investors to maintain sufficient liquidity.

Also, policymakers indicated at the 13th National People's Congress their monetary policy goals are for broad money (M2) and total social financing growth to be "significantly higher" than in 2019.