China stocks rise after small-caps rekindle investor interest
SHANGHAI Oct 20 (Reuters) - China's main indexes rose over 1 percent on Tuesday, as a surge in small-caps rekindled investor interest, earlier suppressed by blue-chip weakness, lifting all sectors in the final hour of trading.
The CSI300 index of the largest listed companies in Shanghai and Shenzhen rose 1.2 percent, to 3,577.70, while the Shanghai Composite Index gained 1.1 percent, to 3,425.33 points.
Until the last hour, the main indexes had been close to flat most of the day.
The start-up board ChiNext outperformed, rising 2.9 percent. The Nasdaq-style board has now rebounded over 35 percent from its mid-September low, dwarfing the roughly 15 percent gain in the benchmark indexes during the same period.
China data released on Monday - including better-than-expected third-quarter economic growth of 6.9 percent - eased angst about a hard landing and offered some evidence of success in Chinese economic restructuring.
There's disagreement over whether the rally can continue.
Credit Suisse said that the China rebound could continue for the next two to three months mainly due to excess liquidity, but some analysts reason that ChiNext shares are already expensive, while further rises in blue-chips are not justified by the current economic situation.
Shares of Sinosteel Engineering & Technology Co Ltd fell, after its state parent Sinosteel said it would delay payment to bondholders.
China's Huaneng Power International jumped 2.9 percent on hopes of strong third-quarter earnings. (Reporting by Samuel Shen and Pete Sweeney; Editing by Richard Borsuk)
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