Shanghai shares close up nearly 5 per cent, extending gains

Shanghai stocks closed up 4.82 per cent today, rising for a second day on strong US growth figures and a global market rally, as dealers speculated the government is also supporting the market.
China's benchmark Shanghai Composite Index surged 148.76 points to 3,232.35 on turnover of 474.6 billion yuan (USD 74.2 billion). Despite two days of substantial gains, the index still lost 7.85 per cent for the week.
The Shenzhen Composite Index, which tracks stocks on China's second exchange, soared 5.40 per cent, or 94.62 points, to 1,846.83 on turnover of 425.0 billion yuan. It fell 9.44 per cent over the week.

In Hong Kong, however, shares fell 1.04 per cent, or 226.15 points, to 21,612.39 on turnover of HK dollar 112.88 billion (USD 14.55 billion).
Dealers said a mixture of positive news boosted the markets, including a Chinese interest rate cut and stronger-than-expected US growth figures for the second quarter, which helped global markets to rally yesterday.
"It's not one single factor pushing the market up," Zheshang Securities analyst Zhang Yanbing told AFP.

"Several factors are working together, such as the rate cut and the local debt swap programme, and the rises in global markets."
The US economy grew much faster than expected in period from April-June, expanding at an annual rate of 3.7 per cent, official data showed yesterday, rather than the 2.3 per cent previously estimated.

The news came after China on Tuesday cut interest rates for the fifth time since November and reduced the amount of money banks must keep on hand in a bid to stimulate the flagging economy.
The cuts helped spur a rally in Asian shares, even though analysts say more action will be needed to dispell fears about stalling Chinese growth that have hit global markets this week.