China shares end firmer on recovery hopes after holiday break

SHANGHAI: China shares ended higher on Friday as mainland markets resumed trade following a week-long break, with investors being encouraged by official data that showed signs of economic recovery and a rebound in tourism during the holiday week.

Tourism sites were visited by 637 million domestic tourists over the eight-day National Day holiday that started Oct. 1, 79pc of last year's total, China's Ministry of Culture and Tourism said in a statement on Thursday.

At the close, the Shanghai Composite index was up 1.68pc at 3,272.08, while the blue-chip CSI300 index closed 2.04pc firmer.

Consumer firms gained 1.94pc and transport shares advanced 2.36pc after data showed that Chinese domestic tourism witnessed a robust rebound over the just-ended Golden Week holiday, encouraged by China's success in stamping out the novel coronavirus, although levels were still well short of last year.

Adding to signs of a firming recovery in the world's second-largest economy, an industry survey showed the recovery in China's service sector activity extended into a fifth straight month in September, with hiring increasing for the second month in a row.

The healthcare sub-index jumped 3.12pc after China announced it has joined a global COVID-19 vaccine initiative, becoming the biggest economy to date to pledge support to help buy and distribute the shots fairly.

The smaller Shenzhen index ended up 3.05pc and the start-up board ChiNext Composite index added 3.813pc.

Around the region, MSCI's Asia ex-Japan stock index was firmer by 0.76pc, while Japan's Nikkei index closed down 0.12pc.

At 0711 GMT, the yuan was quoted at 6.715 per US dollar, 1.24pc firmer than the previous close of 6.799.

The currency was set for its best day since 2005, when Beijing de-pegged its currency from the greenback, as growing expectations that US Democratic presidential candidate Joe Biden could win the November presidential election supported sentiment.

So far this year, the Shanghai stock index is up 7.3pc and the CSI300 has risen 14.3pc, while China's H-share index listed in Hong Kong is down 13.8pc.