Rare earths push up stocks
China stocks rebounded strongly on Tuesday with robust gains in the rare earth sector.
The benchmark Shanghai Composite Index surged 1.23 percent to close at 2,905.97 points. The smaller Shenzhen Component Index soared 1.92 percent to 9,087.52 points while the blue chip CSI300 index ended 1.35 percent higher at 3,666.78 points.
Turnover on the two major bourses expanded from the previous session to add up to 462.73 billion yuan (US$66.98 billion).
Wind Information's sub-indexes for all industry sectors posted rises.
Stock prices of rare earth-related firms listed on the A-share market skyrocketed after reports that China has extended the ban on imports of medium-to-heavy rare earths from Myanmar, which may lead to a sharp increase in the price of rare earths. Trade tension between China and the US was also a factor that lifted prices.
Shenghe Resources Holding Co, China Minmetals Rare Earth Co, Rising Nonferrous Metals Share Co, and China Northern Rare Earth (Group) High-Tech Co all surged by the daily limit of 10 percent.
Rare earth materials are used in various industries including the glass industry and electronics, and can be found in a variety of devices such as mobile phones, windmills and hybrid vehicles.
Agricultural shares rallied from an earlier slump, and stocks related to the poultry industry led the rise.
Electronic component companies such as Wuhan P&S Information Technology Co, Jiangsu Skyray Instrument Co and Beijing Yuanliu Hongyuan Electronic Technology Co all performed strongly.
Venture capital-related companies, leisure goods firms, and stocks related to the Shanghai Free Trade Zone were also among the big gainers.