China Stocks Surge to New Highs: Tech Gains and Market Optimism

China's stock market achieved a new peak on Thursday, reaching a 3-1/2-year high. This rise was mainly driven by booming technology stocks and a surge in investor confidence, setting a positive trend in the market.

As the Shanghai Composite index ascended 0.2%, the tech-focused STAR50 index rose by 1.8% and the semiconductor industry marked a 2.5% jump. Analysts from Citi highlight a resurgence in investor risk appetite, evidenced by margin buying crossing the 2 trillion yuan benchmark, a level last seen during the 2015 bull market.

Stimulative measures announced during the recent Politburo meeting are supporting this growth, along with an extended U.S.-China tariff truce. However, Hong Kong's Hang Seng Index saw a slight 0.1% dip, driven by tech sector reductions. Meanwhile, the gaming sector's strength boosted Tencent shares, which briefly touched HK$600 for the first time since 2021.

(With inputs from agencies.)