Chinese share prices rebounded on Thursday as managers of open-end funds bought stocks of market heavyweights to drive up their net asset value ahead of the third-quarter settlement day on Friday.

An open-end fund is a type of mutual fund that is priced according to its net asset value.

The benchmark Shanghai Composite Index climbed 70.88 points, or 1.33 percent, to close at 5,409.4 points.

The Shenzhen Component Index on the smaller market also ended higher at 18,281.08 points, rising 288.76 points, or 1.60 percent.

The banks performed strongly. The Industrial and Commercial Bank of China went up 3.30 percent to close at 6.58 yuan and Bank of China went up 1.91 percent to close at 5.87 yuan.

Insurance companies also rose on Thursday. China Life was up 0.5 percent to close at 58.39 yuan while China Ping An rose by 4.4 percent to close at 131.5 yuan.

Energy stocks also recovered from heavy losses earlier this week, creating a sound investment climate for Shenhua Energy’s Shanghai listing on October 9, dealers said.

The combined turnover on the two bourses shrank to around 148.22 billion yuan (19.5 billion U.S. dollars) from 159 billion yuan on the previous trading day.

Analysts said the market is set to fluctuate as investor confidence has been shaken by recent weaknesses appearing in the market and their caution ahead of the week-long National Day holiday.

Source: Xinhua

Copyright Fund China 2008.

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