One Championship

Chinese stocks rise strongly for a second day


Investors make trades at a security exchange house in Shanghai, China. Photo: Qilai Shen/EPA

Chinese stocks rose strongly for a second day on Friday, buoyed by a number of government support measures, but worries still persist about the long-term impact that four weeks of stock market turmoil may have on the world’s second-largest economy Reuters reported on 10 July.

Over the past two weeks Chinese authorities have cut interest rates, suspended initial public offerings, relaxed margin lending and collateral rules and enlisted brokerages to buy stocks, backed by cash from the central bank.

The CSI300 index of the largest listed companies in Shanghai and Shenzhen rose another 6% on Friday, while the Shanghai Composite Index gained 5.4%.

Analysts at Bank of America Merrill Lynch said in a research note they expected the ripple effect to eventually hit the real economy and corporate earnings.

On Friday Shanghai Securities News reported that insurers had brought 11.2bn yuan ($1.8bn) of equity since the rout began.

More Articles