China Stock Rally Fizzles As Stimulus News Disappoints

A stock market rally in China has fizzled out as a highly-anticipated announcement on plans to boost the country’s ailing economy disappointed investors.

BBC reports that shares had jumped by over 10% as trading restarted after the Golden Week holiday but fell back after a news conference by the country’s economic planners.

In a volatile session, the Shanghai Composite Index in mainland China was up by around 3% in early afternoon trade, while the Hang Seng in Hong Kong was more than 7% lower.

Investors had been hoping for more information about how the government plans to support economic growth but the announcement gave little in the way of details.

The chairman of China’s National Development and Reform Commission Zheng Shanjie said he is fully confident the country will achieve its full-year economic and social goals.

Mr Zheng’s comments came as he announced that China will issue 200 billion yuan, equivalent to US$28 billion for spending and investment projects by the end of this year.