China equities in longest rally for 11 months

SHANGHAI - China's stocks rose for a seventh day, capping the longest rally in 11 months, as economic growth spurs higher fund flows into the country and improving earnings prospects bolster the nation's lenders.

Industrial & Commercial Bank of China Ltd (ICBC), and China Construction Bank Corp led gains for lenders after Citigroup Inc said Chinese banks will report "solid" earnings growth in the third quarter. Air China Ltd rose to a two-year high after the yuan gained to a record, reducing the cost of financing the airline's dollar debt. Citic Securities Ltd jumped 9.6 percent, capping a 32 percent rally for the week, on speculation surging trading volumes will boost revenue.

"Big-cap stocks with low valuations will be the next beneficiary of the catch-up amid the very ample liquidity environment," said Wu Kan, a Shanghai-based fund manager at Dazhong Insurance Co, which oversees $285 million.