June 2, 2020 / 7:41 AM / a month ago

China shares end higher on optimism over govt economic recovery policies

* Shanghai shares up 0.2%, blue-chips up 0.3%

* Hainan-based firms surge on opening up policy

* China orders SOEs to halt U.S. soybean purchase

BEIJING, June 2 (Reuters) - China shares closed higher on Tuesday as optimism over the government’s new policies seeking to support the economy trumped concerns over deteriorating Sino-U.S. relations.

** The Shanghai Composite index closed up 0.2% at 2,921.40. ** The blue-chip CSI300 index was up 0.31%, with its financial sector sub-index higher by 1.04%, the consumer staples sector down 0.35%, the real estate index up 2.41% and the healthcare sub-index down 0.91%. ** The smaller Shenzhen index ended up 0.2% and the start-up board ChiNext Composite index was weaker by 0.599%.

** “We can continue to expect a steady rebound in stock markets in the following days as the economy is walking away from the COVID-19 impact,” said Zhang Yanbing, an analyst with Zheshang Securities, noting that tensions between Washington and Beijing are a smaller factor at the moment.

** Shares in China’s top liquor makers hit record highs, as investors see industry recovery despite the coronavirus crisis.

** Shares in China’s Hainan-based firms including Hainan Haide Industry Co Ltd, Hainan Dadonghai Tourism Centre (Holdings) and Huawen Media Group all surge by the 10% daily trade limit in morning tradings, as Beijing vowed to further open up the southern island.

** The China government ordered state-owned firms to halt large-scale U.S. soybean purchases, raising the spectre of damaging trade disagreements between Washington and Beijing.

** Around the region, MSCI’s Asia ex-Japan stock index was firmer by 0.61%, while Japan’s Nikkei index closed up 1.19%. ** At 07:08 GMT, the yuan was quoted at 7.1229 per U.S. dollar, 0.09% firmer than the previous close of 7.129.

Reporting by Zhang Yan in Beijing, and Andrew Galbraith in Shanghai; Editing by Vinay Dwivedi

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