Chinese shares rise 1.58 percent in morning trade

Chinese share prices rose 1.58 percent by midday Wednesday after the official media published reassurances about the future stability of the stock market ahead of the Olympics, dealers said.

Sentiment was lifted by a commentary from the official Xinhua news agency Wednesday, saying China's stock market was still on track for stable, healthy development because the country's economic fundamentals remained sound.

Such commentaries are often interpreted as signalling the government's position on economic issues.

The remarks came after sharp falls in China's stock market made it one of the world's worst performing bourses this year.

"The recent sharp decline of the stock market was somehow unreasonable," Chen Huiqin at Huatai Securities told Dow Jones Newswires.

"I think China's macroeconomic fundamentals remain positive and investors' concerns over an economic slowdown have been overpriced," Chen said.

The benchmark Shanghai Composite Index, which covers both A and B shares, gained 41.82 points to end the morning at 2,693.42.

The Shanghai A-share index was up 43.83 points, or 1.58 percent, to 2,824.92 points, while the Shenzhen A-share index jumped 16.45 points, or 2.02 percent, to 829.33.

(Agencies)