China stocks rebound after Beijing offers support
22 September 2008
Chinese stocks soared on Friday following government intervention, with the Shanghai Composite Index (SCI) jumping 9.46% to close at 2,075.09 points. Roughly two thirds of the stocks traded across the Shanghai and Shenzhen bourses rose by 10%, the maximum permitted single-day gain, Bloomberg reported. Just two days earlier, the SCI sank to a 22-month low of 1,929.05 as three major banks posted losses of 10%. On Friday, however, the banks led the charge, emboldened by commitments from Central Huijin, which is owned by the China's sovereign wealth fund, to increase its stakes in the state-run lenders. Beijing's decision to scrap the stamp duty levied on stock purchases was also influential. In addition to gaining 10% in Shanghai, Industrial and Commercial Bank of China and China Construction Bank saw their Hong Kong-listed shares jump 16.2% and 15.7% respectively. Hong Kong's Hang Seng Index closed up 9.6% at 19,327.7.