China stocks rise, Shenzhen’s start-up board hits 6-year high


SHANGHAI: China stocks rose on Wednesday, with Shenzhen’s tech-heavy ChiNext index hitting a six-year high, and as shares of natural resources companies jumped.

The blue-chip CSI300 index rose 0.7% to 5,144.04 points, while the Shanghai Composite Index gained 0.7% to 3,562.66 points.

Shenzhen’s ChiNext jumped nearly 3% to its highest level since June 2015. Shanghai’s tech-focused

market gained 2.8%.

Foreign investors have been buying mainland Chinese stocks via Stock Connect for three straight days despite recent volatility, as China’s low correlations with the US Federal Reserve‘s policy offer diversification benefits to global portfolio managers, Mizuho Bank said in a note.

BlackRock, which this year started treating China as a standalone asset class separate from emerging and developed markets, said in a weekly note that following China’s cut in banks’ required reserves, “we see potential for more, broad-based loosening in the near term, including in fiscal and other policies”.

But Swiss private bank Union Bancaire PrivĂ©e (UBP) expressed caution, reducing its Chinese equity exposure from overweight to neutral. “Chinese equities were hurt by the first-in, first-out effect and in the short term, regulatory risks remain significant.”

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