China’s blue-chip index ends at 13-year high led by gains in banking, healthcare stocks

China's blue-chip index ends at 13-year high led by gains in banking, healthcare stocks

China’s blue-chip index closed on Wednesday at its highest level in nearly 13 years after rising for five consecutive sessions, as investors expect the government to sustain policy supports to counter COVID-19’s persisting impact on the economy.

At the close, the blue-chip CSI300 index was up 0.92% to 5,417.68, its highest since January 16, 2008, while the Shanghai Composite index was up 0.63% at 3,550.88.

Leading the gains, the banking sector sub-index rose 2.38% and the healthcare sub-index added 1.82%. The financial sector sub-index and the consumer staples sector was up 1.63% and 1.25%, respectively.

Due to the weak overseas demand and mounting pressure of coronavirus outbreak both at home and abroad, the monetary conditions will remain loose, Li Hao, an analyst at Sealand Securities, wrote in a note.

Chinese authorities shut sections of highways running through Hebei province that surrounds Beijing on Wednesday and closed a key long distance bus terminal in the provincial capital Shijiazhuang in efforts to stave off another coronavirus wave.

The province, which entered a “wartime mode” on Tuesday, accounted for 20 of the 23 new locally transmitted COVID-19 cases reported in mainland China on Jan. 5, more than the total of 19 cases in the province in the three previous days.

China’s services sector activity expanded at a slower pace in December, a private sector survey showed on Wednesday, as sporadic coronavirus outbreaks tempered the recovery in consumer confidence and weighed on new business growth.

The smaller Shenzhen index ended down 0.07% and the start-up board ChiNext Composite index was higher by 0.552%.

Around the region, MSCI’s Asia ex-Japan stock index was firmer by 1.41%, while Japan’s Nikkei index closed down 0.38%.

At 07:13 GMT, the yuan was quoted at 6.4562 per U.S. dollar, 0.02% weaker than the previous close of 6.455.

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