SHANGHAI: China stocks closed higher on Tuesday, led by tech shares, as investors await the highly anticipated ‘Third Plenum’ meeting where some stimulus measures are expected to be announced, while Hong Kong shares closed roughly flat. The CSI information technology index jumped 3.7%, leading China stocks higher. Trading turnover has fallen, mutual fund issuance has cooled, and northbound outflows have appeared, UBS analysts said in a note.
“But from here, we think the downside is limited. Underpinning A-shares are the government’s repeated assurances this year that it would safeguard capital markets,” UBS analysts said. China’s new yuan loans likely more than doubled in June from May, a Reuters poll showed on Tuesday, as the central bank kept up policy support for the economy amid a shaky recovery. China’s Communist Party will hold a long-delayed third plenum from July 15-18, where some fiscal and financial reform measures are likely to be revealed. At the close, the Shanghai Composite index was up 1.26% at 2,959.37.
The blue-chip CSI300 index was up 1.12%, with its financial sector sub-index higher by 0.94%, the consumer staples sector up 0.35%, the real estate index up 0.28% and the healthcare sub-index up 0.35%. The smaller Shenzhen index ended up 1.74% and the start-up board ChiNext Composite index was higher by 1.434%.
Around the region, MSCI’s Asia ex-Japan stock index was firmer by 0.45%, while Japan’s Nikkei index closed up 1.96%. At 07:32, the yuan was quoted at 7.2718 per US dollar, 0.05% weaker than the previous close of 7.268. At the close of trade, the Hang Seng index was down 20.14 points or 0.11% at 17,443.15. The Hang Seng China Enterprises index fell 0.26% to 6,247.88.
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