Shanghai stocks rose yesterday on increased optimism as more trading accounts were opened in the first week of the year.

The Shanghai Composite Index, which tracks both yuan-dominated A shares and hard-currency B shares, added 1.29 percent 1,226.70. The A-share index rose 1.28 percent to 1,288.52 and the B-share index climbed 2.49 percent at 72.49.

More than 26,000 accounts were opened in the first trading week of this year, according to a survey by China Securities Depository and Clearing Corporation Ltd. The 5,000 accounts that were opened daily on average was an increase of 60 percent over December's as recent government policies have boosted the confidence of investors.

"The government has been ramping up efforts to boost the stock market via various incentives and measures," said Chen Qun, an analyst at West China Securities Co.

For example, China's securities regulator is drafting more than 40 sets of rules as part of moves to place more market orders and protect minority investors.

Meanwhile, the stock reform program has also been carried out smoothly as six months after its implementation, 434 listed companies in China have unlocked their state shares or have their restructuring plans approved.

These firms covered 32.03 percent of the total number listed on the A-share market in Shanghai and Shenzhen.

"The reform is considered a success when G shares account for 60 percent of the market," said Chen. "We will soon see that coming as the reform is running at a robust pace."

Technology chips grew strongly due to high demand and hopes that third generation, or 3G, technology will boost the sector's revenue.

UFIDA Software Co Ltd, the biggest gainer in the sector, soared 9.75 percent to 23.64 yuan, followed by Aerospace Information Co Ltd's 7.04 percent to 21.43 yuan.

Datang Telecom Technology Co Ltd rose 4.12 percent to 8.34 yuan.