China stocks edge higher as hopes of fiscal support improve sentiment

China?s stock markets closed slightly higher on Tuesday, helped by growing expectations of more government support for the economy. The Shanghai Composite rose 0.18% to 3,830.5, while the Shenzhen Component gained 0.34% to 12,902.

Investors are expecting government bond issuance to pick up in the fourth quarter. Local governments had used 81% of their special bond quota in the first nine months of 2026, while the State Council may allow unused borrowing quotas from earlier years to be tapped. This could lead to more debt sales and provide additional fiscal support.

The focus now turns to China?s official and private manufacturing PMI data due Wednesday. Investors will use the figures to assess the health of the manufacturing sector, especially as overseas demand remains firm and the technology sector continues to perform well.

Among the notable gainers, Agricultural Bank of China rose 1.17%, Cambricon Technologies added 2.55%, and Suzhou Dongshan Precision gained 1.74%.

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