Leo Zhang/Shanghai Daily

A news report that overseas institutions have been approved to invest more in yuan-denominated A shares bolstered stocks in Shanghai, sparking optimism of a capital influx.
The Shanghai Composite Index, which covers yuan-denominated A shares and foreign-currency B shares, jumped 1.53 percent to 1,191.22. The A-share Index grew 1.52 percent to 1,251.75 and the B-share Index soared 1.54 percent to 68.04.
"The news gave the market an indication that more funds are in the pipeline," said Zhang Li, a Huatai Securities Co analyst. "Sentiment may turn better in the second half."
Hang Seng Bank Ltd, Hong Kong's third-largest lender, gained regulatory approval to double its investment quota in yuan-denominated stocks to US$100 million, the Shanghai Securities News reported.
The State Administration of Foreign Exchange, which oversees stock investments by overseas investors, declined to comment yesterday.
Overseas institutions were allowed to invest in A shares at the end of 2003.
The central government plans to raise the overseas investment ceiling in stock bourses to US$10 billion from US$4 billion this year, as part of efforts to reverse a five-year market slump.
Jiangxi Copper Co, China mainland's biggest producer of the metal, gained 5.39 percent to 5.28 yuan (65 US cents).