The composite indices of both Shanghai and Shenzhen stock exchanges jumped up by more than 8 percent Wednesday, spurred by the denial of a central bank plan for interest rate increase.

All shares listed on the two bourses went up Wednesday and about 100 shares rose by a daily maximum of 10 percent. Nearly 300 climbed 9 percent.

The governor of the central bank Zhou Xiaochuan said Tuesday that the bank is not going to increase interest rates, and no timetable exists for an interest rate hike.

The Composite Stock Index on the Shanghai Stock Exchange, which comprises yuan-denominated A shares and foreign-currency B shares, closed at 1,115.58 points, up 8.21 percent, with total a turnover of 19.9 billion yuan (2.42 billion US dollars).

The Shenzhen stock exchange closed at 2,936.57 points, up 8.38 percent, the biggest daily jump since June 24, 2001. The total turnover stood at 11.5 billion yuan (1.4 billion US dollars).

Analysts also attributed the soar to a strong rebound after the continuous fall of share prices in the past seven weeks.

Gu Jie, an analyst with Hualin Securities Co., said that another contributing factor is the news that the securities regulator plans to allow listed firms to buy back their shares. The plan demonstrates the regulator's determination to stabilize the stock markets in China, which hit new eight-year low Monday.

Wednesday's total turnover in both Shanghai and Shenzhen stock exchanges was about three times that of the daily turnover for the last few months.

Analysts said there are still room for the indices to rise in coming sessions, and investors should also watch carefully whether some more encouraging news will be confirmed as reported. Various publication have reported news that the central bank, the People's Bank of China, will inject financial resources into selected securities firms, and blue chip firm Yangtze Hydroelectric has been selected for the latest experiment in selling state-owned shares.

China Securities Regulatory Commission, said it began Monday to collect public opinions for the draft of a regulation allowing listed companies to buy back the public shares.

Source: Xinhua