SHANGHAI: Chinese shares finished higher on Tuesday, edging up from the previous day’s slump as consumer and financial firms recovered, but broader gains were limited by investor wariness over possible policy tightening.

At the close, the blue-chip CSI300 index was up 0.87%, after slumping more than 2% on Monday. The Shanghai Composite index was up 0.78% at 3,446.73.

The consumer staples sector rose 2.05% after falling 2.2% a day earlier. The financial sector subindex rose 1.21%, real estate firms jumped 3.73% and the healthcare subindex added 0.96%.

But with a conservative economic growth target this year widely viewed as giving regulators more room to cut back on pandemic-era stimulus, market players see little room for a strong rally.

The smaller Shenzhen index ended up 1% and the start-up board ChiNext Composite index rose 1.06%.

So far this year, the Shanghai stock index is down 0.8% and the CSI300 has fallen 2.5%, while China’s H-share index listed in Hong Kong is up 5.5%. Shanghai stocks have declined 1.78% this month.

“We are in this vortex... a vacuum of any catalyst that actually means anything directional or sentiment-wise to the market,” said Andy Maynard, head of equities at China Renaissance in Hong Kong. “Without a catalyst... we’re not going anywhere. In fact, we’re just going to probably drift lower.”