Mainland stocks rise as low inflation raises prospects for policy easing

Chinese mainland shares ended higher for a second day on Tuesday as lower-than-expected inflation raised the chances of further monetary easing, but persistent worries over the economy kept many investors on the sidelines.

China's consumer inflation hit a five-year low in January and factory deflation deepened, underscoring persistent weakness in the economy.

Analysts said a weak economy would trigger more policy easing, but many investors are still waiting for the economy to bottom out.

The benchmark Shanghai Composite Index rose by 1.50 percent or 46.47 points to 3,141.59 points on Tuesday. The Shenzhen Component Index jumped by 2.47 percent or 268.48 points to 11,136.62 points.

The CSI 300 Index of the biggest companies traded on the bourses in Shanghai and Shenzhen closed up by 1.8 percent or 61.02 points at 3,406.94.

Total turnover on the two bourses was 400.52 billion yuan ($64.17 billion), down from the previous trading day's 436.16 billion yuan.

The largest percentage gainer on the Shanghai exchange on Tuesday was Chaodong Cem, which rose by the daily upward limit of 10.0 percent to 14.91 yuan, while the largest percentage decliner was Nanjing Steel, which fell 8.9 percent to 3.50 yuan.

Among the most active stocks on Tuesday in Shanghai were Bank of China, up 1.49 percent to 4.09 yuan; China Petroleum, up 1.06 percent to 5.74 yuan; and Agricultural Bank of China, up 1.24 percent to 3.27 yuan.

In Shenzhen, the most active stocks included TCL Corp, up 4.9 percent to 3.83 yuan; BOE Technology, up 2.1 percent to 2.86 yuan; and Shenwan Hongyuan Securities Co, down 1.4 percent to 15.31 yuan.

ChiNext, China's NASDAQ-style board for high-tech and fast-growing start-ups, rose by 2.27 percent or 38.83 points to 1,747.68 points.

In Hong Kong, the Hang Seng Index edged up by 0.03 percent or 7.10 points to 24,518.10 points, with total turnover of HK$64.04 billion ($8.26 billion).