Stocks rebound as brokerages, robotics companies lead gains

Chinese stocks rose, erasing losses, as brokerages rallied on speculation the government will allow them to freely conduct proprietary trading after imposing restrictions following a market rout earlier this year.

The Shanghai Composite Index added 0.2 percent to 3,616.11 points at the close, wiping out a loss of as much as 1.3 percent in the last five minutes of trading. Northeast Securities Co and Founder Securities Co gained more than 4 percent after people with knowledge of the matter said regulators have scrapped a rule requiring brokerages to hold daily net long positions. Robot-related stocks rallied after State media reported the government would promote development of the industry.

"It's a further sign that the government is confident that the market has stabilized and basically gone back to normal," said Wei Wei, an analyst at Huaxi Securities Co in Shanghai. "It's good news for brokerages as they don't need to be burdened with the task of supporting the market."