SHANGHAI, Sept 8 (Reuters) - China stocks closed higher on Tuesday, supported by heavyweight financials firms as investors sought opportunities in cheap shares, though persistent Sino-U.S. tensions weighed on the market.
** The blue-chip CSI300 index rose 0.5%, to 4,694.39, while the Shanghai Composite Index added 0.7% to 3,316.42, snapping a four-day losing streak.
** The tech-heavy start-up board ChiNext climbed 0.4%, while the STAR50 index slipped 0.9%.
** Heavyweight financial firms, including banking and securities companies, led the rebound.
** The CSI300 banks index rallied 1.6%, while the CSI SWS securities index firmed 2.1%.
** There are no foundations for a continued sharp correction in the A-share market as valuations are low for many cyclical sectors, said analysts.
** Banks will witness a recovery in valuations in the fourth quarter, as there will be less pressure on them to surrender profits due to an economic recovery in China, Northeast Securities wrote in a report.
** A continued improvement in the operating environment due to Beijing’s deepening capital market reforms is the most significant catalyst for the country’s securities companies whose valuations remain at decade-low levels, analysts at Shanxi Securities said in a report.
** Investors continued to pull out of high-flying consumer firms on worries over their lofty valuations following stellar gains.
** The CSI300 consumer staples index lost 1.3% on Tuesday, but has still gained nearly 50% this year.
** Simmering Sino-U.S. tensions also weighed on sentiment.
** U.S. President Donald Trump on Monday again raised the idea of de-coupling the U.S. and Chinese economies, suggesting the United States would not lose money if the world’s two biggest economies no longer did business. (Reporting by Shanghai Newsroom)
Our Standards: The Thomson Reuters Trust Principles.