China's shares jumped 1.4 percent on Tuesday to their highest levels in more than a month as funds, hopeful about an imminent market recovery, built positions in large caps such as Huadian Power International Corp Ltd. The benchmark Shanghai composite index ended at 1104.038 points, its highest close since June 29 when it finished at 1104.992 points.
Analysts said the market's four-year slump was nearing an end, and investors seemed to have regained confidence since the July 21 yuan revaluation. "Funds were chasing blue chips today. They've been active ever since the yuan revaluation," said Zhang Yong, an analyst with Great Wall Securities.
Huadian Power, China's third-largest electricity producer, finished the day up 2.3 percent at 3.08 yuan, extending a 1.7 gain at the lunch break.
Merchants Bank Co Ltd, the top domestically listed lender, rose 1.8 percent to 6.78 yuan, while smaller rival Minsheng Banking Corp Ltd closed up 2.7 percent at 5.32 yuan.
Wuhan Iron and Steel Co Ltd, which had dipped 0.6 percent in the morning on a report of price cuts, managed a mild rebound.
The listed arm of the country's third-largest mill advanced 1.7 percent to end at 3.68 yuan. The Shanghai Securities News reported on Tuesday that the steel maker in central China would cut some product rates for September - its second price cut in less than two months - amid hints of oversupply in the market. Beijing revalued the domestic currency 2.1 percent last month in a move seen as boosting corporate buying power and domestic consumption in the long run.
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