China shares up on premier's easy credit pledge

Chinese shares rebounded Monday after the country's premier affirmed the country's easy credit policy for the coming year.

The benchmark Shanghai Composite Index rose 47.43 points, or 1.5 percent, to close at 3,188.78. The Shenzhen Composite Index for China's smaller second exchange jumped 1.5 percent to 1,186.20.

Premier Wen Jiabao, the country's top economic official, told the government's Xinhua News Agency on Sunday that Beijing will continue its relaxed monetary policies in 2010 rather than drastically withdraw its stimulus. That came after investors fretted for weeks about a year-end decline in liquidity.

"The reaffirmation laid out an expectation for next year's economic policy and boosted market confidence," said Cai Xiang, an analyst for Sinolink Securities in the Western city of Chengdu.

Industrial & Commercial Bank of China Ltd., China's biggest commercial lender, edged up 1.6 percent to 5.22 yuan. Bank of China Ltd. added 1 percent to 4.16 yuan, while China Construction Bank Ltd. rose 0.9 percent to 5.87 yuan.

Metal producers rose after the government said Monday total profits at industrial companies rose 7.8 percent in the first 11 months of 2009 from a year earlier.

Baoshan Iron & Steel Co., China's biggest steelmaker, gained 3 percent to 9.19 yuan, while Jiangxi Copper Ltd. climbed 1.9 percent to 38.7 yuan.

Oil heavyweights jumped after crude rose above $78 per barrel in Asia.

PetroChina Ltd., Asia's biggest oil producer, leapt 1.4 percent to 13.4 yuan, while China Petroleum & Chemical Corp., or Sinopec, Asia's largest refiner by capacity, gained 1.8 percent to 13.55 yuan.

In currency markets, the yuan weakened to 6.8299 against the U.S. dollar, down from Friday's close of 6.8276.