Chinese mainland markets staged a technical rebound on Monday after a bleak end to last week, with growth and innovation shares leading gains as investors rotated into artificial intelligence (AI) applications and bet on fresh policy support for the capital markets, according to a market analyst.
The Shanghai Composite Index was up more than once percent, while the STAR 50 jumped 3.1 percent and the ChiNext gained 1.9 percent. The CSI 300 rose a more modest 0.8 percent, offering some relief after a record 12 consecutive weekly declines.
Timothy Pope, a market analyst at China Global Television Network (CGTN), said the session's standout theme was a shift toward companies involved in the commercial application of AI.
"Today we saw investors chasing companies involved in the commercial application of AI, rather than the nuts and bolts of it, semiconductors and the like. So, there was a lot of interest in companies linked to AI-generated short video dramas, animations as well, with Mango Excellent Media hitting its 20 percent daily upward limit. Aside from that, we had liquor producers and brokerages also doing well today. Kweichow Moutai gained more than three percent. Guotai Haitong Securities climbed more than two percent. And we saw two, at least two, other brokerage listings hitting their 10 percent daily limit today," he said.
The analyst attributed much of the optimism to rising hopes for policy support.
"A lot of this seems to have come from rising hopes of policy support. We saw China's manufacturing and non-manufacturing PMI results come out at the weekend, and both had slipped into contraction territory. And [on] Friday, after the Shanghai Composite Index closed below 3,600 points, since then, there's been more speculation about additional state support for the capital markets, too. Reports that financial regulators were meeting to discuss measures to support share buybacks helped lift brokerage stocks in particular," said Pope.
Chinese stocks rebound as investors bet on AI applications, policy support: analyst
China's top legislature has convened its latest standing committee session in Beijing from November 2 to 6 to review a series of draft laws and amendment bills addressing issues including procuratorial public interest litigation, state-owned assets, Antarctic protection, and combating cross-border corruption.
The second draft of the cross-border anti-corruption bill anchors legislation in a holistic approach to national security, and stresses strict rule of law, due process and human rights protection.
According to Zhou Guangquan, Vice Chairman of the Constitution and Law Committee of the 14th National People's Congress, the draft sets out provisions for authorities to use information technology in cross-border anti-corruption work.
He also noted that members of the public have called for tighter safeguards for state secrets, work secrets, trade secrets, personal information and privacy.
Separately, some Standing Committee members and experts said enterprises with cross-border operations should factor in company size, business scope and risk prevention needs when establishing integrity compliance units or appointing dedicated anti-corrruption staff. Following deliberation, the suggestion was put forward for adoption.
The session will also review the second reading of the draft financial law.
The latest draft aims to boost consumer and investor protection, unify asset management rules, regulate online financial marketing, and tighten oversight of cross-border financial activities.
Xin Chunying, Chairperson of the Constitution and Law Committee of the 14th National People's Congress, said the committee proposed adding a rule that prevents overseas institutions or individuals providing financial products and services within Chinese territory without approval.
She also stated that entities legally providing such products and services in China must comply with laws, administrative regulations and the provisions of the State Council's financial regulatory authorities.
The draft Antarctic Activities and Environmental Protection Law entered its third reading at the session with updated clauses outlining China's participation in global Antarctic governance, improving the national expedition management system, and protecting Chinese citizens' lawful rights in Antarctica.
Several other draft law revisions are being tabled for first deliberation at this session, including amendments to the Criminal Procedure Law to refine the foreign-related criminal litigation system, a revised Renewable Energy Law to tighten regulations and boost industrial development, and several updates to the Ecology and Environment Code that took effect in August.
Lawmakers will also review a State Council proposal to ratify the Agreement on the Establishment of the World Artificial Intelligence Cooperation Organization.
China's top legislature convenes standing committee session
