China stocks close up on hopes of liquidity injection

Chinese stock shares rose more than two percent on Tuesday with hopes of more liquidity injection from the central bank into the market fueling optimism.

The benchmark Shanghai Composite Index rose 2.07 percent to end the day at 2,337.87. The Shenzhen Component Index moved up 2.03 percent to close at 7,988.34 points.

Total turnover on the two bourses expanded to 333.3 billion yuan (54.24 billion U.S. dollars) from 241.6 billion yuan on the previous trading day.

Hopes of more capital injection were fuelled by media reports that the People's Bank of China, the central bank, will inject funds into the market via mid-term lending facility (MLF), a new form of liquidity management tool.

Shares related to the high-speed train industry gained after talks of a merge plan between China's leading railway car manufacturers, CSR Corp and China CNR Corp.

Trading for CSR and CNR has been suspended since Monday. China Railway Construction Corp. rose 9.96 percent. Gem-year Industrial went up by the daily ceiling of ten percent.

The ChiNext Index, a NASDAQ-style board tracking growth enterprises, gained 2.01 percent to end at 1,522.05 points on Tuesday.