SHARES in Shanghai jumped more than 3 percent yesterday on news that more favorable and prudent economic policies will be introduced to stabilize the market.
The benchmark Shanghai Composite Index advanced 3.65 percent, or 73 points, to 2,073.57. Turnover reached 41.9 billion yuan (US$6.12 billion). Gainers outnumbered losers 691 to 157 while 58 stocks were unchanged.
The Central Committee of the Communist Party of China decided at the Third Plenum meeting that flexible and prudent economic policies shall be adopted to boost domestic demand, particularly consumption, and keep the economy, the financial sector and the capital market stable.
The economic growth forecast this year was revised down at 9 percent from 11.9 percent last year, said a communique released at the four-day plenum held in Beijing, which also approved a plan on Sunday to double the income of the country's farmers in 12 years.
"The decision to invest more funds in rural development by the Central Committee of the CPC is important since agricultural development serves as a major growing force of the economy," according to a research report by Orient Securities Co.
Agricultural shares generally performed well. Xinjiang Sayram Modern Agriculture Co Ltd added 5.41 percent to 7.41 yuan while Wanxiang Doneed Co Ltd surged by the daily cap of 10 percent to 7.71 yuan.
Index rebounds
The index fell to 1,920 in the morning session as a result of turmoil in surrounding markets but rebounded in the afternoon, led by banking shares and heavyweights on speculation that Central Huijin Investment Co will increase stakes in state-owned companies.
The Bank of Communications and Shanghai Pudong Development Bank Co Ltd surged by the daily cap of 10 percent. The Bank of China added 6.75 percent to close at 3.32 yuan while the Industrial and Commercial Bank of China, the nation's biggest lender, jumped 7.50 percent to 4.30 yuan.
Airlines rose after crude oil fell to US$80.42 per barrel yesterday, the lowest since September 10, 2007. Air China added 6.49 percent to 5.58 yuan. China Eastern Airlines Corp surged 6.91 percent to close at 4.33 yuan.