Financial, property shares boost city index

Shanghai shares closed up on Friday, led by gains in the financial and property sector.

The Shanghai Composite Index edged up 0.39 percent to close at 2,601.72 points. For the week, the gauge added 0.22 percent.

Shares of banks, home appliances and property developers were among the biggest gainers today.

Market sentiment rose after the China Banking and Insurance Regulatory Commission said on Thursday that China will allow insurance firms to invest in tier-2 capital bonds and perpetual bonds issued by banks.

"This move aims to improve the liquidity of commercial banks, optimize capital structure, enhance the ability to better serve the real economy, prevent risks and enrich the allocation methods of insurance funds," the commission said in a statement on its website.

Chuancai Securities said in a report that "valuation of banking shares has the opportunity to increase. Banks with better risk control methods and higher business barriers will have advantages in the future." 

The brokerage suggested investors pay close attention to banking shares in the long-term.

Poly Developments And Holdings Group Co Ltd rose 3.02 percent to 12.30 yuan (US$1.82) and Bank of Nanjing Co Ltd added 2.50 percent to 6.96 yuan.