SHANGHAI, March 17 (Reuters) - China shares rose on Thursday, extending a jump from the previous session after the country's top policymaker assured markets of stability and support, while hope of a breakthrough in ceasefire talks between Russian and Ukraine also boosted sentiment.
The blue-chip CSI300 index rose 2.0%, to 4,237.70, while the Shanghai Composite Index gained 1.4% to 3,215.04 points.
The benchmark Shanghai index had been at its lowest in nearly 21 months and down 16% for the year until Tuesday, hobbled by fears of a blowback on China from its dealings with sanctions-hit Russia, uncertainty in global demand and, in recent days, a spike in domestic COVID-19 cases that threatens to disrupt economic activity.
Vice Premier Liu He's assurances on Wednesday have helped it retrace a third of the losses.
The Hang Seng index jumped 7.0%, to 21,501.23, while the China Enterprises Index gained 7.5%, to 7,407.57 points. Both indexes, which have borne the brunt of selling of Chinese stocks this year, logged their biggest two-day gain since 1998.
The indexes had surged on Wednesday after Liu said Beijing would roll out more support for the Chinese economy as well as be cautious with measures for capital markets, which helped put a floor under sectors hurt by a prolonged regulatory crackdown.
Liu's comments were followed by supportive messages from five top financial regulatory bodies, including the People's Bank of China, the China Securities Regulatory Commission and the State Administration of Foreign Exchange.
"With China's top leadership shifting their focus to expectation management, the line in the sand has been drawn. This may help markets find the bottom in the near term," Tommy Xie, vice president and head of Greater China Research at OCBC, wrote in a note to clients, adding a policy rate cut could come before the end of March.
"In addition, attractive valuations may also attract long-term investors, should geopolitical risks not escalate further from here," he added.
The supportive comments also snapped seven consecutive sessions of outflows through China's Stock Connect programme on Wednesday. Refinitiv data showed inflows totalled 9.1 billion yuan ($1.43 billion) on Thursday.,
Liu also said the government would continue to support local firms that seek to list overseas and added China's talks with U.S. regulators on overseas listings of Chinese firms have made positive progress.
Tech firms listed in Hong Kong rose 7.8% on Thursday, after a record 22% surge on Wednesday.
Internet behemoths and index heavyweights Alibaba Group and Meituan both gained over 12% each, while video-platform provider Bilibili Inc, search engine giant Baidu Inc and e-commerce platform JD.Com jumped over 15% each.
Chinese real estate developers were among the top gainers in both mainland and Hong Kong markets, with the Hang Seng Mainland Properties Index soaring 18%, after the official Xinhua news agency reported late Wednesday that China was putting a planned property tax trial this year on ice, citing the finance ministry.
The move helped ease concerns of more tightening measures in the floundering real estate sector, which has slumped for months owing to Beijing's campaign to reduce high debt levels.
Sunac China Holdings led the gains with a nearly 60% jump, while Country Garden Holdings, China's top property developer by sale, rose 28.4%, and the debt-laden Evergrande Group added 17.8%.
Developments in talks between Moscow and Kyiv also buoyed investor sentiment. Ukraine's President Volodymyr Zelenskiy said negotiations were becoming "more realistic", while Russian Foreign Minister Sergei Lavrov said proposals now being discussed were "in my view close to an agreement". (Reporting by Jason Xue and Andrew Galbraith; Editing by Kim Coghill and Krishna Chandra Eluri)
