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1st LD Writethru: Positive economic data lift Chinese shares

Xinhua, November 3, 2016 Adjust font size:

Chinese shares rallied on Thursday after a private survey showed activity in the service sector expanded at a faster pace in October, adding to signs of firmness in China's economy.

The Caixin China General Services PMI (Purchasing Managers' Index) rose to a four-month high of 52.4 in October from 52 in September, according to the survey conducted by financial information service provider Markit and sponsored by Caixin Media Co. Ltd.

A reading above 50 indicates a month-on-month expansion while a reading below that points to a contraction. This added to the encouraging manufacturing PMI data for China released Tuesday.

Commenting on the data, Zhong Zhengsheng, director of macroeconomic analysis at CEBM Group, said "the economy continued to expand in October and at a stronger growth rate. It may be possible to sustain this stable condition throughout the fourth quarter" with supportive policies.

Chinese stocks opened lower Thursday, but started to trade up on the back of the strong Caixin PMI data. The benchmark Shanghai Composite Index gained 0.84 percent to end at 3,128.94 points while the Shenzhen Index closed 0.48 percent higher at 10,743.96 points.

China's NASDAQ-style ChiNext Index climbed 0.32 percent to finish at 2,153.18 points.

Turnover on the two stock exchanges expanded to 640.5 billion yuan (95.6 billion U.S. dollars), from 544 billion yuan the previous trading day.

Financial shares led the gains. Hua Xia Bank grew 1.82 percent to 10.61 yuan. Shares of Citic Securities, China's largest brokerage, increased 1.38 percent to 16.86 yuan while those of Guoyuan Securities surged 7.78 percent to 25.06 yuan. Endi