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China / Business

Mainland stocks rise as rare-earth shares gain

By Bloomberg (China Daily) Updated: 2016-04-20 09:14

Chinese mainland stocks rose for the first time in three days as a rally by rare-earth producers offset falling energy shares in the Shanghai and Shenzhen bourses.

The Shanghai Composite Index rose 0.3 percent at the close, after declining the most in three weeks on Monday. Xiamen Tungsten Co and China Northern Rare Earth Group High-Tech Co gained more than 3 percent, while Yantai Jereh Oilfield Services Group Co led losses by energy companies. The volume of shares traded on the gauge was 27 percent below the 30-day average.

The March rebound in mainland equities has slowed this month, with the Shanghai benchmark index up just 1.3 percent amid waning turnover as better economic data spur concern that the government will refrain from adding stimulus.

Prudence will feature more prominently in China's monetary policy than last year, while a certain degree of looseness will be maintained, the Xinhua News Agency said in a commentary on Monday.

"Speculation that the authorities will take steps to cut capacity as well as boost buying for State reserves is lifting rare-earth producers," said Shen Zhengyang, a strategist at Northeast Securities Co in Shanghai. "The 'prudence' note will have some impact on market sentiment as credit growth has been fueling stock gains and regulators may be concerned about over-leveraging."

The Shanghai Composite closed at 3,042.82 points. 

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