China's shares closed at a five-month high Monday amid rising hopes that the U.S. Federal Reserve would ease the monetary policies thus sparking growth in the Chinese economy.
The benchmark Shanghai Composite Index, which is a combination of A and B shares, saw an up tick of 68.20 points, or 2.5%, to close at 2806.94; its last rally was on May 5 when it closed at 2857.15. The Shenzhen Composite Index rose 10.35 points, or 0.9%, to close at 1212.14.
Analysts have expressed hopes that the Shanghai index will most likely rise to 2850 this week as some positive signals about global economic recovery have started to emerge and there are favorable liquidity conditions.
The largest gains were visible in the energy sector and metal companies as metal prices reached a five-month high in Shanghai after seeing a strong rally on the London Metal Exchange Friday. Poor job data released Friday by the U.S. Department of Labor also contributed to the price boost. Analysts say that a weak dollar has raised investors' interest in metals which has also been supported by a rise in worldwide gold prices.
Real estate companies and banks also saw a surge as China Vanke, the country's biggest developer in terms of market share, released its strong sales figures of CNY14.21 billion in September, up 160.1% from the year earlier.
China Vanke surged 4.7% to CNY8.84 and Poly Real Estate Group rose 5.5% to CNY13.42 with the Industrial Bank seeing an up tick of 4.4% to close at CNY25.40.
