Confidence returning as shares are up 2%

Chinese stocks jumped over 2 percent with an increased volume on Tuesday as blue chip and consumption shares rebounded, indicating a return to stability and confidence in the domestic market.

The benchmark Shanghai Composite Index increased 2.34 percent to 2,722.44 points. The Shenzhen Component Index was up 2.37 percent to 9,921.68 points.

Trading volume on the two bourses was 712.5 billion yuan (US$101.8 billion), compared with 687.4 billion yuan on Monday.

The GEM (China Growth Enterprise Market) index rebounded 2.73 percent to 1,876.91 points, following a 4.6 percent plunge on Monday. A total of 84 firms on the STAR Market gained with only eight closing lower. 

The market is facing an end to “panic selling” and is becoming “temporarily stable,” Guotai Junan Securities said. 

Northbound funds — overseas capital flowing into Chinese mainland markets via Stock Connect schemes — generated a net inflow of 3.99 billion yuan on Tuesday, following an outflow on previous trading days.

Insurance giant Ping An Insurance jumped 3.28 percent to 68.95 yuan while home appliance giant Gree surged 3.90 percent to 51.14 yuan. 

China Unicom was up 3.11 percent to 5.31 yuan after the country’s No. 2 mobile carrier posted a 22.1 percent growth in net profit in 2019.

In the long term, the market still faces uncertainty, mainly because of the COVID-19 outbreak’s influence on overseas markets, according to analysts.