BEIJING: China’s stocks rose to an eight-week high after traders speculated the government will accelerate reforms of state-owned companies and data showed the nation’s broadest measure of new credit exceeded estimates.
The Shanghai Composite Index climbed 0.3 percent to 3,348.58 at the break, heading for the highest close since Aug. 21. The benchmark gauge has surged 5.2 percent this week, poised for the steepest gain in two months. AVIC Aero-Engine Controls Co. and Beijing Capital Co. both jumped 10 percent to lead rallies for aerospace companies and utilities on prospects for industry restructuring. The market’s two-week rebound continued to lure back investors, with trading volumes jumping 55 percent above the 30-day average.
The Shanghai Composite has risen 14 percent from an August low amid speculation that policy makers will introduce more measures to boost growth after a rout in equities that erased almost $5 trillion of market value. Data released this week showed consumer prices rose at a slower pace in September, leaving more room to ease monetary policy. SOE reform has become a catalyst for the market after the government this week announced plans to reorganize the telecom industry and promote price reforms in the utilities sector.
“The central bank has loosened its tap on liquidity and the SOE reform will continue through the year,” said Wei Wei, an analyst at Huaxi Securities Co. in Shanghai. “It’s a good time window for stocks now and the rebound will probably carry on.
