Shanghai Composite: hopes of market support

One of the main Chinese stock indexes saw its largest daily increase in more than two years, after signs that the government would intervene to support troubled stock markets would be known.

The Shanghai Composite closed up 4.1%, its biggest rise in a day since March 2016.

Movements extend a rally that began Friday and after investor confidence returned to Beijing's insurance.

Inventories were down as China's economic growth continued to stutter.

On Friday, senior Chinese financial officials – including economic adviser Liu He and the heads of the securities and insurance commissions – issued a statement to boost investor sentiment in crisis markets.

"The headlines of leading Chinese officials on Friday were deafening and extremely coordinated, which had a positive effect," said Chris Weston, analyst of Pepperstone in a research note.

Over the weekend, the government released a draft new rules on personal tax deductions, according to Reuters.

The world's second largest economy faces challenges such as the high level of its debt and the intensification of the trade war with the United States.

Data released Friday showed that in the third quarter of the year, the Chinese economy had grown at the lowest rate since the global financial crisis, posting a 6.5% growth over the previous year. the year before.

• The trade war between the United States and China will hurt

The rate was down from the 6.7% recorded in the previous quarter, but remains in line with the government goal of a whole year of about 6.5%.

For years, China has been striving to wean its economy out of its exports and rely more on domestic consumption for growth.

At the same time, the government has struggled to contain rising debt, fueled by a wave of infrastructure development and a housing bubble without harming growth.

In recent months, Beijing has taken steps to support its economy, including reducing capital requirements to increase liquidity and mitigate the slowdown.