SHANGHAI, Aug 15 (Reuters) - Chinese shares closed higher on Tuesday, but weakening sentiment ate away at gains from the morning session, even as stronger profits at commercial banks helped to support banking shares.
The blue-chip CSI300 index rose 0.3 percent, to 3,706.06 points, while the Shanghai Composite Index gained 0.4 percent, to 3,251.26 points.
China CSI300 stock index futures for August rose 0.3 percent, to 3,694.4, 11.80 points below the current value of the underlying index.
“We saw a strong rally yesterday and this continued in the morning session, but there aren’t stand-out factors supporting further strong gains,” said Wang Jun, an analyst at First Capital Securities.
The weak gains followed news that U.S. President Donald Trump had authorised an inquiry into China’s alleged theft of intellectual property in the first direct trade measure by his administration against Beijing, but the move, which is unlikely to prompt near-term change, did not appear to be a factor in the day’s trading in China.
“Regarding this news, there won’t be a noticeable effect on Chinese stock markets,” Wang said.
Concerns over tensions between the United States and North Korea, which led to declines in global markets last week, have been less of a factor this week and have continued to wane as North Korea’s leader delayed a decision on firing missiles toward Guam.
Financials were the best-performing component of the CSI300 index, with the banks sub-index rising 1.4 percent.
Bank stocks were strengthened by a statement from China’s banking regulator late on Monday that first-half profits for commercial lenders rose nearly 8 percent from the same period in 2016, while the level of non-performing loans (NPLs) in June did not increase from March.
Bank of China closed 3.1 percent higher and China Construction Bank rose 2.9 percent.
Energy and healthcare shares dragged on the index. The energy sub-index fell 0.3 percent, and the healthcare sub-index fell 0.6 percent.
Shanxi Xishan Coal and Electricity Power Co fell 2.3 percent, and Shanghai Pharmaceuticals Holding Co Ltd suffered a 3.2 percent drop.
Reporting by Andrew Galbraith; Editing by Jacqueline Wong