Chinese shares jump three percent in morning trade

Chinese share prices ended Monday morning trade up 3.04 percent as gains in overseas markets as well as steel and mining stocks drove a wave of bargain hunting, dealers said.

Metal stocks were in focus on strong copper prices and robust 2007 earnings from Liuzhou Iron and Steel, in what analysts described as a technical rebound in response to share prices that have tumbled 40 percent since January.

"The market rebounded technically after shares had been seriously oversold, with blue chips also bolstered by some new stock funds which are building their positions," said Cao Yan, an analyst at Soochow Securities.

The China Insurance Regulatory Commission (CIRC) gave its approval Monday to three more insurance companies to invest in local stock markets, a move expected to boost tight liquidity.

Liuzhou Iron and Steel rose by the 10 percent daily trading limit to 15.16 yuan, after the company reported its 2007 net profit rose 32 percent.

Chen Jinren, an analyst at Huatai Securities, added that sharp gains in overseas markets added to the positive sentiment, especially in battered financial plays.

The benchmark Shanghai Composite Index ended the morning up 104.71 points or 3.04 percent at 3,550.96.

The Shanghai A-share Index rose 109.85 points to 3,726.23, while the Shenzhen A-share Index was up 46.73 points at 1,102.14.

(Agencies)