10:53 GMT20 June 2021
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    Chinese stock markets maintain their surge after Chinese central bank interest rate cuts.

    MOSCOW, November 27 (Sputnik) — China’s stocks closed up for a fifth day on Wednesday, driven by financial sector share gains in the wake of Friday’s surprise move from the People’s Bank of China to cut interest rates for the first time since 2012.

    Chen Ruiming, a strategist at Haitong Securities Co. in Shanghai told Bloomberg that the fast growth represents an arresting change to the previous downward trend: “This is a big bottom after years of the bear market. The current 2,600 level isn’t the end and there’s more room for upside. It’s a bull market.”

    The Shanghai Stock Exchange Composite Index climbed 1% to 2,630.49 at its close on Wednesday, according to data from Bloomberg, who reported that 339 billion yuan ($55 billion) of shares were traded, the highest volume since its records began in 2005.

    The CSI 300 index of the largest listed companies in Shanghai and Shenzen also made gains and closed up 1.16% to 2,754.49. Figures from Reuters show that financial companies were subject to the most activity, with Everbright Bank up 7.36% to 3.21 yuan, Minsheng Bank up 1.98% to 6.70 yuan and Industrial Securities up 9.85 percent to 11.04 yuan in Shanghai.

    However, other experts expressed caution over the bullish figures. “It’s a good chance we’re at a market top right now,” David Cui, a strategist at Bank of America Corp. told Bloomberg. “Based on the experience since the global financial crisis, surging volumes each time marked a temporary top for the market.” Cui reiterated his belief that stocks will drop in the longer term because of rising corporate debt levels and excess capacity in some industries in China.

    Investors also warned that the surge for the Chinese market was not expected to translate to the Hong Kong market. “I just can’t see any money flowing southbound,” one expert told Bloomberg. Hong Kong’s Hang Seng Index was down 0.45% to 24,004.28 at close on Wednesday.


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