China stocks hit 2-week high after premier urges officials to stabilize market

SHANGHAI: China stocks rose to two-week highs on Monday after Premier Li Qiang urged government officials to strengthen efforts to stabilize share prices, further mitigating trade war fears.

China’s blue-chip CSI300 Index closed the session up 0.3%, while the Shanghai Composite Index gained 0.5%, both hitting the highest level since April 3, just ahead of the market slump triggered by Donald Trump’s “reciprocal tariffs”.

The Hong Kong market is closed for a local holiday.

China kept benchmark lending rates steady for the sixth successive month on Monday, matching market expectations, though analysts expect fresh government stimulus in the second quarter to counter trade war woes.

China stocks tumbled 7% on April 7, but have recouped much of the losses as Beijing took swift and resolute measures to steady the market, including stepping up stock buying by state-backed investors and share buybacks by listed companies.

On Friday, Chinese Premier Li Qiang told government officials to step up efforts to stabilize the stock market, part of efforts to mitigate the impact from heightened trade tensions with the United States.

Non-ferrous metals jumped 4%, leading gains onshore, as the dollar tumbled and gold soared to a record high on trade war concerns.

Financial shares fell 0.5%.

Beijing warned countries against striking a broader economic deal with the US at its expense, ratcheting up its rhetoric in a spiralling trade war between the world’s two biggest economies.

Meanwhile, focus is shifting towards the upcoming month-end Politburo meeting for clues of policy support, but expectations for immediate policy rollouts among onshore equity investors remain low, UBS analysts said.