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China shares end higher as central bank calms virus fears

Reuters | Beijing | Updated: 04-02-2020 13:47 IST | Created: 04-02-2020 13:36 IST
China shares end higher as central bank calms virus fears
Representative image Image Credit: Flickr

Chinese stocks ended higher on Tuesday as the central bank vowed to stabilize the market, regaining some ground from the coronavirus-led rout that erased almost $400 billion in market value from the Shanghai benchmark in the previous session.

** The Shanghai Composite index closed up 1.3% at 2,783.29 — the biggest daily gain since Dec. 13, 2019. The blue-chip CSI300 index jumped 2.6%, clocking its biggest daily gain since July 1, 2019. ** CSI300's sub-index for the financial sector gained 2%, the consumer staples sector jumped 2.9%, the real estate index was up 2.2% and the healthcare sub-index climbed 3%. ** About 36.40 billion shares were traded on the Shanghai exchange — the highest since April 10, 2019. The volume in the previous session was 21.59 billion. ** The Shanghai benchmark plunged on Monday, the first opportunity to react to the coronavirus epidemic after the extended Lunar New Year break. ** China's central bank said on Tuesday that its huge liquidity injections through open market operations this week showed its determination to stabilize financial market expectations and restore market confidence. ** The People's Bank of China (PBOC) injected 1.2 trillion yuan ($173.81 billion) into money markets through reverse bond repurchase agreements. It also unexpectedly cut the interest rate on those short-term funding facilities by 10 basis points. ** "After the drop on Monday, expectations for further policy easing are rising, which provide support for the A-share market," said Zhou Longgang, an analyst with Huachuang Securities. ** The smaller Shenzhen index rose 1.8% and the start-up board ChiNext Composite index was higher by 4.8% as investors believe lower financing costs could benefit those companies whose long-term development would not be impacted. ** The death toll in China jumped to more than 420 and total infected cases rose to 20,438. China has agreed to allow U.S. health experts into the country as part of a World Health Organization (WHO) effort to help fight the virus. ** The impact from a virus epidemic on China's economy will be limited and temporary and the country's financial markets will return to normalcy in the long run, a commentary in a newspaper owned by the central bank said on Monday afternoon. ** Around the region, MSCI's Asia ex-Japan stock index was firmer by 1.59%, while Japan's Nikkei index closed up 0.49%. ** The onshore yuan was trading 0.45% firmer at 6.9905 per dollar as of 0730 GMT.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)

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