New | Mainland China large-cap index surges 2.6 per cent to four-month high

A key index of Chinese stocks shares closed at a four-month high on Monday as investors warmed to recent macroeconomic data, sending mainland consumer and banking stocks higher, while Hong Kong blue chips finished mostly flat.

Investors liked the recent run of positive mainland data including better than expected loan growth numbers and monthly rises in factory output and fixed-asset investment, analyst Ivan Li from Tung Shing Securities said.

Analysts say investors also expect further cut to mainland base rates in the New Year as well as reductions in banks’ required reserve ratios, freeing up more money for lending.

“Hong Kong’s strength is mainly driven by the China market and the market is getting less pessimistic about China's economic outlook,” Li said.

The large-cap CSI 300 index charged 2.60 per cent higher to 3,865.96, its highest close since mid-August. A 10 per cent surge in shares of China Minsheng Bank to 9.98 yuan led the gainers on the mainland, with the wider Shanghai Composite index up 1.77 per cent at a three-week high of 3,642.47. Industrial and Commercial Bank of China shares rose 1.52 per cent to 4.69 yuan and China Life Insurance gained 3.06 per cent to 29.66 yuan.

Consumer stocks also rallied with car maker SAIC Motor up 4.40 per cent to 21.61 yuan.

The Shenzhen Composite Index rose 0.96 per cent to 2,357.99.