Shanghai shares rally after morning losses

Tracy Li
There were mixed results for China's stock markets on Thursday after they opened higher when investors were encouraged by overnight gains on Wall Street.
Tracy Li

China’s stock markets posted mixed results on Thursday, with the Shanghai Composite Index notching a V-shaped rally after big losses in the morning session.

The market opened higher as investors took heart from overnight gains on Wall Street.

Though weighed on by consumption sectors such as medicine, food and beverages in morning trade, the benchmark Shanghai Composite Index inched 0.26 percent higher to 3,386.46 points, thanks to strong performances by securities brokers.

 The smaller Shenzhen Component Index dipped 0.70 percent to finish at 13,863.13, while the ChiNext Index dropped 1.60 percent to 2,814.37 points.

Volume on the two main bourses was 1.29 trillion yuan (US$185 billion), compared with 1.19 trillion yuan in the previous session.

More than half of the sectors fell. National defense military led the gains, while medical biology, food and beverage and media firms were among the big decliners.

China Merchants Securities expects the A-share market to maintain upward momentum while showing some fluctuations, as it is still in the two-and-a-half-year upward cycle that began in early 2019.

Although monetary policy easing has weakened, the current market is gradually shifting from liquidity-driven to fundamental-driven, as China's economic data continues to improve and more industries will usher in improvement in the upcoming second quarterly report.

More funds will continue to flow into the capital market, the broker noted.

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