Weapon makers, telecom operators propel Chinese shares

Chinese shares continued to rally on Friday, driven by military-related companies and telecommunication service providers.

The benchmark Shanghai Composite Index rose 0.36 percent to finish at 3,310.3 points, while the Shenzhen Component Index inched up 0.06 percent to close at 11,757.68 points.

The Hushen 300 Index, which samples about a fifth of the total stocks listed on the two bourses, climbed 0.18 percent to close at 3,572.84 points.

The ChiNext Index, tracking China's Nasdaq-style board of growth enterprises, gained 2.53 percent to end at 1,928.04 points.

Shares of aircraft makers soared 3.79 percent to lead Friday's increase, and other weaponry-related companies also enjoyed big gains.

"Investors are optimistic about the ongoing market-oriented reforms in military enterprises," said Sun Xiwei, chief investment advisor with CITIC Securities.

Telecommunication service providers and electronic devices makers also saw a bullish run on the news that two of China's major telecom operators received 4G licenses on Friday.

China Telecom and China Unicom were permitted by the Ministry of Industry and Information Technology to offer services based on LTE FDD technology to rival market leader China Mobile.

China Unicom's shares rocketed 5.6 percent and shares of Hong Kong-listed China Telecom advanced by 0.4 percent. China Mobile dipped 1.5 percent in Hong Kong.

Financial shares rose in the first two trading days in the Lunar New Year, but tumbled most sharply with a 0.49-percent fall on Friday.

"Financial shares are generally on a rise in the long run, but right now, the sector will probably not see continued growth," said Sun.