Chinese shares edged higher on Tuesday after Beijing pledged stronger counter-cyclical policy support to address economic pressures and support growth.
The blue-chip CSI300 index rose 0.1%, while the Shanghai Composite gained 0.2%. Gains were modest as trading volumes remained low ahead of China’s week-long National Day holiday. Hong Kong’s Hang Seng Index moved in the opposite direction, falling 0.5%.
China’s State Council said existing policy measures should be implemented more effectively and called for faster issuance and use of government bonds. The cabinet also called for major infrastructure projects linked to the country’s 2026-2030 five-year plan to begin construction as soon as possible.
The policy commitment provided particular support for Chinese property stocks. Vanke gained 10% after the State Council said it would introduce measures to stabilise the housing market. Analysts at Goldman Sachs expect further support, including potential changes involving housing provident funds and mortgage rates, although these measures have not yet been confirmed by Beijing.
The government is also seeking to support investment and consumption through interest rate subsidies, infrastructure upgrades and targeted measures. It plans to expand relending facilities for technology innovation, industrial upgrading, agriculture and smaller businesses, while considering further measures covering housing, employment and household incomes.
The renewed policy focus comes as China’s economic momentum has weakened. Growth slowed to 4.3% in the second quarter, while industrial output, retail sales and investment also softened at the beginning of the third quarter. The property sector remains under pressure, adding to the need for further policy support.
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