Chinese and Hong Kong stocks were firm in Wednesday trade, with resources shares rebounding sharply after China's upbeat August industrial profit data and robust earnings forecast by a major steelmaker helped ease fears of China's economic recovery losing steam.
Investor confidence was also underpinned by signs of China's government accelerating the restructuring of its bloated state sector, and a conviction in Beijing's vow to safeguard market stability ahead of a Communist Party Congress next month.
China's blue-chip CSI300 index was up 0.2 per cent at 3,826.35 points at the end of the morning trading session, while the Shanghai Composite Index was unchanged at 3,344.68 points.
In Hong Kong, the Hang Seng index added 0.4 per cent to 27,635.26 points, while the Hong Kong China Enterprises Index gained 0.7 per cent to 11,041.49.
China industrial profit
Investors took relief from data showing annual profit at China's industrial companies rose 24 per cent in August, accelerating from the previous month in an indication economic growth remains healthy despite signs of fading momentum following a robust first half-year.
Reflecting the trend, Anyang Iron & Steel Inc forecast a seven-fold jump in net profit for the first nine months, boosting its Shanghai-listed shares by 10 per cent - the maximum allowed.
Meanwhile, investors also harboured hope that listed firms will benefit from stepped-up reform of state-owned enterprises in China.
The Shanghai Securities News had reported on Tuesday that Ping An Insurance Group Co of China is in discussion with China Eastern Group regarding the latter's plans for mixed-ownership reform.
Meanwhile, CSSC Offshore & Marine Engineering said its controlling shareholder, China State Shipbuilding Corp (CSSC), is planning to restructure assets of the listed unit, sending its Hong Kong-listed shares surging. CSSC's China-listed shares were suspended from trading.
Resources firms, the biggest beneficiary from industry consolidation and state reform, rose sharply. In China, the CSI300 materials subindex climbed nearly 1 per cent, while an index tracking the sector in Hong Kong rose 1.6 per cent.
Banking shares dragged in China, with Jiangsu Changshu Rural Commercial Bank slumping more than 5 per cent to a near one-year low, pressured by more equity supply as some investors come out of lock-up periods.