China stocks firm after strong loan data, change in futures rules

SHANGHAI: China stocks rose on Monday, bolstered by stronger-than-expected loan data that added to views economic growth is holding up well and by the loosening of restrictions on stock index futures trading.

China's financial futures exchange said on Friday it was cutting margin requirements and transaction fees for certain stock index futures contracts, as regulators use an ongoing equity market recovery to relax restrictions imposed during a 2015 crash.

The blue-chip CSI300 index rose 0.3 percent, to 3,843.14 points, while the Shanghai Composite Index also added 0.3 percent, to 3,362.86 points.

August loan data, released after the market close on Friday, showed Chinese banks extended more credit than expected, buoyed by demand from home buyers and companies.

China home price data on Monday was also well received.

While home price rises continued to moderate in general after a series of government cooling measures - suggesting authorities have been successful in deflating a property bubble - there were no signs of a severe correction that would damage the economy.

Moreoever, underlying housing demand still appears solid, even if the pace of sales has slowed somewhat.

Confidence was further supported by a central bank survey showing one-third of Chinese households still believe home prices will keep rising in the coming quarter, despite state moves to cool them.

"People are finding that the property sector is not as bad as they expected, which is why major property firms have become investors' darlings," asset manager Windsor Capital said a report.

But an index tracking real estate firms eased as investors booked profits after a recent strong rally.

Consumers led the gains, as market participants chased Chinese liquor makers, expecting the week-long Mid-Autumn Festival and National Day holiday starting Oct. 1 to boost demand for liquor.