China stocks extend rally on growth hopes

** China stocks rose to multi-year highs on the last trading day of 2020, as investors cheered a Sino-Europe investment deal and Beijing's policy support for its capital markets. ** Activity in China's factory sector rose in December as the economy sustained its recovery to pre-pandemic levels, a business survey showed on Monday, even as higher costs slowed the pace of expansion.

China stocks kicked off 2021 on a firm note on Monday, after a survey pointing to a continued recovery in the world's second-largest economy bolstered investor sentiment.

** The CSI300 index rose 1.2% to 5,274.67 points at the end of the morning session, its highest since June 15, 2015, while the Shanghai Composite Index gained 0.9% to 3,504.57 points, its highest since Jan. 30, 2018. ** China stocks rose to multi-year highs on the last trading day of 2020, as investors cheered a Sino-Europe investment deal and Beijing's policy support for its capital markets.

** Activity in China's factory sector rose in December as the economy sustained its recovery to pre-pandemic levels, a business survey showed on Monday, even as higher costs slowed the pace of expansion. ** "We are optimistic about the equities market this year, as the fragility of a global economic recovery means the super-loose liquidity conditions would remain, while China pledges continued and stable policy support for its economy," analysts at Zhongtai Securities said in a note.

** Analysts at Morgan Stanley reiterated their overweight stance on Chinese A-shares, citing an improved possibility of increased weightage in global indices and better cushioning from Sino-U.S. tension uncertainties. ** Bucking the broad rally, banking and real estate stocks retreated as Beijing moved to cap property loans by banks.

** The Hang Seng index rose 0.8% to 27,434.61 points, while the Hong Kong China Enterprises Index lost 0.2% to 10,719.94. ** Falling the most, the Hang Seng telecommunications index declined 3.3%.

** China's three biggest telcos saw their shares drop as much as 5% in Hong Kong on Monday, the first trading session since the New York Stock Exchange (NYSE) said it would delist the firms under a plan China branded "political" and of "limited" impact.