China stocks rose on Wednesday after better-than-expected factory activity surveys reinforced recent signs of rising economic momentum, but gains were pared in the afternoon as investors took profits.
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The blue-chip CSI300 index rose 0.2 percent to 3,458.44 points, while the Shanghai Composite Index also tacked on 0.2 percent to 3,246.93 points.
China’s factory activity expanded faster than expected in February, with growth in both output and orders accelerating, official and private factory surveys showed on Wednesday.
"This is the 7th consecutive month that China’s official manufacturing PMI stayed within expansionary territory, suggesting that industrial activity remains buoyant," said Zhou Hao, emerging markets economist at Commerzbank AG in Singapore.
Analysts say the survey results inject a dose of confidence into the market, at a time when fears surge that the recent recovery, triggered by government stimulus, has seen its day.
"There has been concern that the economic recovery we’ve seen is short-lived, and that growth will slow again in the second quarter. So this is good news," said Chang Chengwei, analyst at Hengtai Futures.
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Chang added that investors were also hopeful that the National People’s Congress (NPC), which starts this weekend, will unveil reform policies that "exceed expectations."
Most sectors rose, led by resources stocks.
Shares of express delivery firm S.F. Holding climbed 4.8 percent in its seventh session of gains, surging as much as 83.5 percent in just seven trading days.
The stock had briefly made its founder Wang Wei the country’s second richest person, only behind Dalian Wanda’s Wang Jianlin.
(Reporting by Luoyan Liu and John Ruwitch; Editing by Shri Navaratnam)
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