China stocks rebound as market sentiment improves

Chinese shares rebounded on Tuesday as market sentiment improved after a drop of more than one percent during the previous trading day. The benchmark Shanghai Composite Index rose 0.26 percent, or 5.21points, to finish at 2,038.51. The Shenzhen Component Index lost 0.15 percent, or 11.79 points, to close at 7,740.75. Combined turnover on the two bourses fell to 176.8 billion yuan (29.2 billion U.S. dollars) from 219.2 billion yuan on the previous trading day. Chinese industrial businesses saw their profits rise 12.2 percent year on year in 2013, accelerating from 5.3 percent in 2012, Tuesday's figures from the National Bureau of Statistics showed. The market was also calmed as Chinese investors avoided a high-profile trust default. China Credit Trust on Monday reached a last-minute deal with investors to repay their investment in the three-billion-yuan product, deflating concerns that a default would pound investor confidence in shadow banking and trigger credit crunches. Financial shares that suffered major losses on Monday recovered. Bohai Leasing rose 2.93 percent. Industrial Bank gained 2.17 percent and China Minsheng Bank edged up 1.99 percent. Vaccine shares rose as bird flu spread in the country. Jiangsu Lianhuan Pharmaceutical soared 7.66 percent. Shenzhen Neptunus Bioengineering went up 4.65 percent and Hualan Biological Engineering rose 3.37 percent. Investors continued to court newly listed shares. Muyuan Foodstuff, Maiquer Group, Shanghai Amarsoft Information and Technology, and another five companies with new shares on the Shenzhen stock market gained by the daily cap of 44 percent. The ChiNext Index, a Nasdaq-style board tracking China's growth enterprises, lost 0.43 percent, or 6.33 points, to end at 1,471.34 points on Tuesday.