SHANGHAI, Nov 28 (Reuters) - China's blue-chip CIS300 Index
rose for the sixth straight session, with upbeat
industrial profit data strengthening belief that the Chinese
economy has bottomed out, making risk assets such as equities
more attractive than bonds.
The blue-chip CSI300 index rose 0.4 percent, to
3,535.08 points, while the Shanghai Composite Index
gained 0.5 percent to 3,277.00 points, both hitting their
highest levels since early January.
Investors' risk appetite continued to rise after data showed
China's industrial profits in October rose 9.8 percent, aided by
the raw materials sector.
However, growth stocks continued to lag, closing
down 0.3 percent.
Blue-chips rather than small-caps were underpinning the
recent rally in the China market, because modestly-priced
cyclical stocks were the biggest beneficiaries from investors
rotating money out of property and bonds, said David Dai,
Shanghai-based investor director at Nanhai Fund Management Co.
"More and more investors believe the economy has bottomed
out and that the bond market's bull run is coming to an end,
which is why blue-chips are becoming attractive and being
re-priced," Dai said.
An across-the-board rally in commodities, in particular base
metals, was fuelling a strong advance in material stocks.
Elsewhere, China State Construction surged to
its 10 percent trade limit, making a near 1-1/2-year high, after
Chinese financial conglomerate Anbang Insurance Group said it
could buy up to 3.5 billion more shares in the company, kindling
enthusiastic buying in undervalued heavyweight infrastructure
firms. Anbang already has a 10 percent stake in
China State Construction.
(Reporting by Luoyan Liu and John Ruwitch; Editing by Simon