Consumer bounce lifts China shares; blue-chips break 5-week losing streak

Consumer bounce lifts China shares; blue-chips break 5-week losing streak

SHANGHAI: China’s blue-chip CSI300 index rose on Friday and snapped a five-week losing streak, boosted by beaten-down consumer firms and strong inflows from foreign investors.

At the close, the blue-chip CSI300 index was up 2.27 per cent at 5,037.99 points. It rose 0.62 per cent for the week, its first weekly gain after five straight weeks of losses.

The Shanghai Composite Index closed 1.63 per cent higher at 3,418.33. It rose 0.4 per cent for the week after four straight weeks of losses.

Consumer staples stocks, which have been heavily sold off in recent weeks, led gains. A sub-index tracking the consumer staples sector rose 2.53 per cent, led by foreign investor favourites Kweichow Moutai Co Ltd, up 2.13 per cent, and Wuliangye Yibin Co Ltd, up 3.89 per cent.

Refinitiv data showed strong inflows through the northbound leg of the Stock Connect as foreign investors bought shares. The financial sector sub-index rose 0.91 per cent, the real estate index gained 0.45 per cent and the healthcare sub-index jumped 3.88 per cent.

China’s central bank on Thursday reiterated its intention to keep liquidity reasonably ample and said monetary policy has to be flexible and precise. Concerns over tightening policy have weighed on investor sentiment in recent weeks.

The CSI300 remained in correction territory, down more than 15 per cent from a record high touched on Feb. 18. The SSEC has avoided falling into correction territory, but remains down more than 8 per cent from a more than five-and-a-half-year high touched on Feb. 18.

Great Wall Motor Co’s shares rose by the 10 per cent daily limit after Reuters reported that Xiaomi Corp would use Great Wall’s factory to make electric vehicles.

The smaller Shenzhen index ended up 2.21 per cent and the start-up board ChiNext Composite index was higher by 3.366 per cent. At 0701 GMT, the yuan was quoted at 6.5435 per U.S. dollar, 0.06 per cent firmer than the previous close.

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