Mainland stocks inch higher as volume thins, outlooks diverge

Major mainland stock indexes edged up on Monday, though the ChiNext fell, as the total trading volume on the major stock exchanges continued to decline.

The benchmark Shanghai Composite Index added 0.1 percent to close at 3,015.83 points, while the Shenzhen Component Index finished the day 0.09 percent higher at 10,718.36 points.

The CSI 300 Index of the biggest companies traded in Shanghai and Shenzhen rose 0.18 percent to 3,230.89 points.

The ChiNext Index, which tracks the country’s NASDAQstyle board for growth enterprises, slipped 0.18 percent to 2,245 points.

A total of 491.7 billion yuan ($ 73.62 billion) in shares changed hands on the Shanghai and Shenzhen exchanges on Monday, down from Friday’s total.

Analysts held differing opinions about what drove the market on Monday. Analysts from Haitong Securities thought that expectations for looser monetary policies both at home and abroad pushed stock prices higher. They also noted that Chinese government’s vigorous push to reform State- owned enterprises would spur investment, supporting equities.

The central banks of the US and Japan will each hold their rate- setting meetings this week, which will effect the market’s expectations for monetary policy going forward.

Wang Delun, an analyst from the Industrial Securities, noted that improved risk appetite has helped push domestic shares higher recently. He said there will be some ups and downs in the near term, but stressed that short- term fluctuations won’t mean the rally is over.

Others were less optimistic. Analyst from the Northeast Securities said that mainland stocks have already peaked for the time being. They noted there is an urgent need for incremental capital to enter the market in order for stocks to continue to rise. Without that, downward pressure will build, leading to a short- term slump.