SHANGHAI, Sept 9 (Reuters) - China stocks rebounded for the second day on Wednesday to a three-week high, with the Shanghai market moving into positive territory for the year on hopes of fresh government stimulus.
The CSI300 index of the largest listed companies in Shanghai and Shenzhen rose 2.0 percent, to 3,399.31, while the Shanghai Composite Index gained 2.3 percent, to 3,243.09 points.
China’s Ministry of Finance said on Wednesday that the government will strengthen fiscal policy, boost infrastructure spending and speed up reform of its tax system to support the economy, adding to other steps by authorities to re-energise sputtering growth.
“The rebound is the result of sharp share price falls previously, and the accumulative effect of government supportive measures,” said Zhou Lin, analyst at Huatai Securities.
“But it’s too early to judge if the rally is sustainable, because there’s still heavy selling pressure.”
In a sign that some foreign investors are taking profit from the China market rebound, there was a net outflow of 2.77 billion yuan ($434.50 million) under the Shanghai-Hong Kong Stock Connect scheme.
Stocks rose across the board.
Banking shares underperformed as investors took profit from the previous day’s rally.
Some stocks related to China’s planned restructuring of state-owned enterprises (SOEs) outperformed.
“This SOE reform theme seems to remain as one of the most popular thematic investments,” wrote Gerry Alfonso, director of Shenwan Hongyuan Securities Co.
Investors will likely see more acquisitions and restructuring in the sector in the not too distant future, he added.
$1 = 6.3752 Chinese yuan Reporting by Samuel Shen and Pete Sweeney; Editing by Jacqueline Wong