A shareholder at a securities hall in Hangzhou, the capital of Zhejiang province in eastern China, on September 24, 2024.
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Chinese shares rose to their best day in 16 years on Monday, with related US ETFs also rising as recent economic stimulus boosted investor optimism in the market.
The Shanghai Composite Index rose 8.06% on its best day since September 2008, capping a nine-day winning streak for the index. It ended September up 17.39%, the first monthly gain in five and the best monthly performance dating back to April 2015.
The Composite index of Shenzhen closed up 10.9%, the best day since April 1996. In September, the price rose 24.8%, the best month dating back to April 2007.
The Chinese ADR index closed down 1.2%. Earlier in the day, the price rose almost 6%.
The US-listed shares of an online video company Bilibili and real estate agency Futu companies increased slightly.
China ADR Index
The KraneShares CSI China Internet ETF (KWEB) 0.6% gained.
Chinese stock markets fell after Beijing last week unveiled a raft of economic stimulus measures, including interest rate cuts to support the weak real estate market. On Thursday, state media said Chinese President Xi Jinping and other top leaders confirmed the measures.
“While we’re not sure there will be enough to really get the economy moving again, it’s certainly the right first step,” said Art Hogan, chief market strategist at B. Riley Wealth. “I think the impact of a strengthening China cannot be underestimated.”
“On balance, this will have an ambiguously positive impact on future markets,” he added. “And I think many investors will have to adjust their expectations quickly.”
More American investors are optimistic about the market after this move. Last week, billionaire hedge fund founder David Tepper said he is overwhelmingly bullish on Chinese stocks, having bought “everything” related to China following the Federal Reserve’s recent rate cut.
– CNBC’s Gina Francolla, Nick Wells, Lim Hui Jie and Evelyn Cheng contributed to this report.
Correction: Art Hogan is chief market strategist at B. Riley Wealth. An earlier version misstated his company.