1st LD-Writethru: Chinese shares rally on sound fundamentals

Chinese stocks continued to rally Wednesday as improved economic fundamentals lifted investor confidence.

The benchmark Shanghai Composite Index went up 0.2 percent to close at 3,140.85 points while the smaller Shenzhen Component Index closed 0.39 percent higher at 10,204.84 points.

Total turnover on the two bourses stood at 430.76 billion yuan (62.6 billion U.S. dollars), up from the previous day's 386.9 billion yuan.

The ChiNext Index, China's NASDAQ-style board, ended 0.09 percent higher at 1,820.48 points.

Stocks related to the Xiongan New Area, a new economic zone to be built near Beijing, jumped in the afternoon session. Shares of Tianjin Capital Environmental Protection Group, for example, rose by the daily limit of 10 percent.

Improved macroeconomic fundamentals, evidenced by a string of recent data, will continue to lift A-shares, especially bluechip stocks, analysts said.

In the first quarter, China reported better-than-expected 6.9-percent economic growth, beating the full-year target of 6.5 percent.

The job market also showed signs of improvement. China added 3.34 million new jobs in the first quarter, 160,000 higher than in the same period last year, while unemployment fell by 0.07 percentage points to 3.97 percent.

The economic recovery could benefit shares of industry leaders, whose share prices are currently undervalued, according to Guosen Securities.

Bluechip shares in industries such as home appliance, food and beverage, and automobiles have some upside potential, according to China International Capital Corporation, an investment firm. Endi