SHANGHAI: China stocks closed up on Monday, led by new energy and machinery shares, after the country’s central bank cut a slew of short- and medium-term interest rates to bolster economic growth.
The blue-chip CSI300 index rose 0.2% to end at 4,786.74, while the Shanghai Composite Index gained 0.04% to 3,524.11.
China’s central bank lowered the funding cost of 14-day reverse repos when injecting 150 billion yuan ($23.68 billion) into the banking system, to “maintain stable liquidity ahead of the Lunar New Year.”
Traders said the rate cut was expected as it came after a slew of key short- and medium-term rate reductions last week.
China will be able to achieve economic growth of around 5.5% in 2022, an adviser to the government’s cabinet said on Friday, making a rosier prediction than markets expect as recent data have pointed to slowing momentum.
New energy stocks surged 2.7%, with the photovoltaic industry and new energy vehicles up 3.2% and 2.1%, respectively.
Real estate developers gained 1.2%. China Evergrande Group named a state firm official to its board, while two of its peers sold some assets to state-owned entities, amid hopes of growing government intervention to aid the crisis-hit property sector.
China’s real estate sector will likely see “significant easing” in the policies that govern it, BNP Paribas Asset Management said.
The machinery sub-index, semiconductors and non-ferrous metal added between 1.5% and 1.7%.