China stocks rise for third session as regulatory worries ebb

China's main stock index rose for the third straight session on Monday after a five-week losing streak, as concerns over tighter financial regulations and liquidity eased after Beijing's soothing comments.

The blue-chip CSI300 index rose 0.4 per cent to 3,399.19 points, while the Shanghai Composite Index added 0.2 per cent to 3,090.23 points. 

But the upbeat sentiment was capped by China's disappointing factory activity and investment data that deepened worries of renewed economic slowdown.

Chinese stocks sank to seven-month lows last week in a five-week losing streak, as a coordinated campaign among financial regulators against shadow banking and risky, leveraged investments drove up market rates and dented investor confidence.

But in an apparent effort to settle market nerves, China's banking regulator said on Friday that risks in the banking sector were completely controllable, and the market did not have to be nervous of scrutiny.

In addition, Chinese Premier Li Keqiang said on Sunday that China would strike a balance between financial stability, gradual deleveraging, and steady economic growth, noting that China was capable of maintaining stability in its financial markets.

Such market-friendly language helped offset economic concerns triggered by news that China's factory output and fixed asset investment growth cooled more than expected in April.

Most sectors gain ground, led by defensive consumer and health care stocks.

Shares of cyber-security stocks were in the spotlight after the global cyber attack over the weekend, with more than 10 stocks in the sector, including Venustech Group, Bluedon Information Security Technologies and Nsfocus Information Technology jumping by the daily 10 per cent limit.

Source: Timesofoman