China shares rebound by 6 per cent, following Wall Street

Business Materials 19 November 2008 13:17 (UTC +04:00)

China's two stock markets soared by more than 6 per cent Wednesday, buoyed by speculation of more government economic measures and an overnight rally on Wall Street, reported dpa.

The key Shanghai Composite Index, which tracks shares traded in foreign and local currencies, gained 115.04 points, or 6.05 per cent, to close at 2,017.47.

The smaller Shenzhen Composite Index ended the day up 32.33 points, or 6.16 per cent, jumping to 557.31.

Both markets had lost more than 6 per cent Tuesday after strong gains last week and Monday.

State media attributed the rebound to speculation that the government would increase assistance to industries affected by the global financial crisis after a recent announcement of a 4-trillion-yuan (586-billion-dollar) package of infrastructure spending.

News that the government plans to introduce a long-awaited fuel tax also helped to boost shares in the auto and petrochemical industries.

Chinese auto firms, like those in the United States and Europe, are seeking government help amid forecasts that vehicle sales in China could rise by 5 per cent next year, compared with 22 per cent last year, the Shanghai Daily newspaper said.