CHINA’S stocks rose yesterday, supported by demand for more speculative small-cap shares, but trading remained thin as investors waited for more clues on the health of the economy.

    The CSI300 index of the largest listed companies in Shanghai and Shenzhen rose 1.8 percent to 3,308.25, while the Shanghai Composite Index gained 1.9 percent to 3,156.54 points.

    Small-caps rebounded strongly, with Shenzhen’s startup board ChiNext up 4.7 percent, and an index tracking tech shares soaring 5.7 percent.

    “Investors seem to be favoring short-term trading in the IT sector with relatively frequent rallies and corrections,” said Gerry Alfonso, a director at Shenwan Hongyuan Securities.

    The rise came as President Xi Jinping set off for the United States, fuelling hopes several trade agreements will be signed.

    “The official visit of Chinese authorities to the United States is giving support to some stocks as in these type of visits, there tends to be some type of business agreements or at least some type of cooperation agreements,” said Alfonso. “Chinese companies are looking into expanding overseas and these official visits could be rather helpful.”

    Markets are looking to China’s flash factory activity survey Wednesday for clues on whether the economy is deteriorating more rapidly than earlier thought.

    Economists expect the flash September China factory manufacturing purchasing managers’ index (PMI) headline reading to edge up to 47.5 from a final 47.3 in August, but likely remained near 6-1/2-year lows, pointing to a seventh straight contraction in activity on a monthly basis.

    That is likely to add to economists’ consensus view that China’s economy is in a protracted but gradual slowdown and not facing an imminent hard landing. But any signs of a more marked slowdown could spark fresh selling in global markets.

    Most sectors rose at the close, but the CSI300 Banks Index ended down 0.3 percent.

    China National Nuclear Power Co. jumped 5.9 percent, after British Chancellor George Osborne said yesterday Britain welcomed the potential for majority Chinese investment in future nuclear projects.

    Britain will also provide 2 billion pounds (US$3.1 billion) in initial support for a new nuclear power station at Hinkley Point in southwestern England, a project China is backing. (SD-Agencies)