SHANGHAI, March 24 China stocks rose on Friday
as strong gains in the infrastructure sector offset concerns
over tightening liquidity in the country's banking system,
increased regulation and fresh curbs on property investment.
The blue-chip CSI300 index rose 0.8 percent to
3,489.60 points, while the Shanghai Composite Index
added 0.6 percent to 3,269.45.
Both indexes rose for the second week in a row. The CSI300
advanced 1.3 percent, while SSEC gained 1 percent.
Investors in China are being torn between data showing a
resilient economy and fears that expected policy tightening,
while gradual, will eventually lead to higher borrowing costs
and stunt business activity.
Signs of tighter liquidity have been a focus this week, as
cash conditions tightened on worries the central bank's
quarterly risk assessment at the end of this month would
restrict lending in the interbank market.
Adding to the pressure, a central bank survey reinforced
expectations that authorities may have to take more aggressive
measures to cool the red-hot property market, even at the risk
of dampening economic growth.
However, investors found some solace after index compiler
MSCI said it was seeking feedback from market participants on
whether to add Chinese A-shares to its China Index and emerging
Investors continued to seek out heavyweight blue chips which
pay out generous dividends in cash.
China Shenhua, the country's largest coal miner,
surprised markets by announcing a hefty special dividend earlier
this week, thanks to a surge in coal prices last year. The stock
gained 15.6 percent for the week.
Investors also chased stocks related to China's high-profile
"One Belt, One Road" initiative, lending support to
infrastructure stocks, which closed up 2.1 percent
at a near 15-month high.
China will hold "One Belt, One Road" International
Cooperation Summit in mid-May. The plan is a signature foreign
and economic policy of Chinese President Xi Jinping, envisioning
massive infrastructure spending to link China to the rest of
Asia and Europe.
An index tracking stocks related to the initiative
jumped 2.3 percent to settle at a near 15-month
high, posting its best week in a year.
(Reporting by Luoyan Liu and John Ruwitch; Editing by Kim