China shares rise on tech bounce; concerns over virus spread cap gains

Reuters2021-08-04
  • SSEC +0.85%, CSI300 +0.9%.
  • Tech shares rebound from Tuesday's sharp falls.
  • Private survey shows faster service sector growth.

SHANGHAI, Aug 4 (Reuters) - A bounce back in tech shares lifted up China's main stock indexes on Wednesday, as a private survey showed faster service sector growth, but worries over surging COVID-19 cases weighed on sentiment, keeping gains in check.

At the close, the Shanghai Composite index was up 0.85% at 3,477.22. The blue-chip CSI300 index rose 0.90%.

Tech shares rose across the board, with the CSI Info Tech sub-index gaining 2.42%. It fell 2.31% on Tuesday after a state media article described online games as "spiritual opium".

Tech shares recovered even as an opinion article in the ruling Communist Party's official People's Daily newspaper said that China should better protect minors from the dangers of the internet.

The smaller Shenzhen index ended up 1.7% and the start-up board ChiNext Composite index was higher by 2.47%.

Providing some support for market sentiment, a private survey showed that growth in China's services sector accelerated in July, helped by a recovery in consumption.

But a surge in domestic COVID-19 cases remains a threat to the growth outlook. China reported the most number of new locally transmitted cases since January on Wednesday.

The CSI300 financial sector sub-index fell 0.64%, the consumer staples sector lost 1.72%, the real estate index slid 0.95% and the healthcare sub-index slipped 0.58%.

Around the region, MSCI's Asia ex-Japan stock index was firmer by 0.81%, while Japan's Nikkei index closed down 0.21%.

At 07:13 GMT, the yuan was quoted at 6.4611 per U.S. dollar, 0.14% firmer than the previous close of 6.47.

So far this year, the Shanghai stock index is up 0.1% and the CSI300 has fallen 4.5%, while China's H-share index listed in Hong Kong is down 12.6%. Shanghai stocks have risen 2.35% this month.

(Reporting by Andrew Galbraith; Editing by Rashmi Aich)

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