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Shanghai - China’s stocks rose, led by technology shares, on speculated state buying after officials moved to tighten curbs on margin borrowing.
The Shanghai Composite Index rose 0.7% at the close, with all the gains coming in the last 40 minutes of trading. The measure slumped as much as 1.7% earlier.
Suspected intervention by China’s central bank also helped the yuan jump sharply in offshore trading to reverse earlier losses. The Hang Seng China Enterprises Index retreated 2% in Hong Kong.
READ: China to double margin requirement for stocks
The Shanghai and Shenzhen stock exchanges cut by half the amount of borrowed money investors can use to buy shares, as authorities sought to prevent a repeat of the excesses that led a $5trn rout.
Government-backed funds may have spent at least $235bn in the third quarter to prop up equities, according to Bank of America.
International Monetary Fund Managing Director Christine Lagarde announced late Friday that her staff have recommended the Chinese currency be included in the fund’s Special Drawing Rights, alongside the dollar, euro, pound and yen.
“There might have been some buying from state-linked funds today, particularly by the end of the day,” said Gerry Alfonso, a sales trader at Shenwan Hongyuan Group in Shanghai. “Even after accounting for the hike in margin requirements, the macro picture remains relatively strong.”
