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October 22, 2018 @ 13:31 +03:00
Chinese stocks surged for a second day on Monday, propelled by a chorus of reassuring comments from leaders and top regulators. The Shanghai Composite rallied 4.6% to 2668 and the smaller Shenzhen Composite soared roughly 5.4%, putting both on pace for their best day in more than three years. That helped lift equities in not-as-beaten-up Hong Kong HSI, +2.32% by 2.2%. The rebound in both also helped ease the early selling seen elsewhere in the region.
Over the weekend, President Xi Jinping emphasized China’s support for the private sector, according to the official Xinhua News Agency. Beijing also released new details on proposed personal income tax cuts, Xinhua said. The Chinese president’s comments followed concerted moves on Friday by Vice Premier Liu He — Xi’s top economic official — as well as the head of the central bank and two financial regulators to reassure investors. More stimulus is on the way, including major tax and fee cuts that could be worth more than 1% of GDP, the state-owned Shanghai Securities News quoted Ma Jun, a policy adviser to the People’s Bank of China, as saying.
China’s rally comes after last week’s report on weaker-than-expected third-quarter GDP growth. Investment bank Nomura said Monday it expects Beijing to roll out more easing and stimulus measures in the months ahead. Chinese officials made attempts to boost the beaten down market via supportive statements Friday about the economy and financial markets, which helped stocks Friday, but for the week, the Shanghai Composite still lost 7.6%.