China stocks extended their rally on Monday, with the blue-chip index scaling a 31-month high, helped by gains in the defensive consumer and healthcare firms as well as a boost from tech shares.

At the close, the Shanghai Composite index was up 13.50 points or 0.39 per cent at 3,501.36, its highest since early 2016. The blue-chip CSI300 index was up 1.19 per cent, with its financial sector sub-index lower by 0.15 per cent, the consumer staples sector up 3.88 per cent, the real estate index up 0.8 per cent and healthcare sub-index up 1.77 per cent.

The smaller Shenzhen index ended up 1.16 per cent and the start-up board ChiNext Composite index rose 2.32 per cent. Around the region, MSCI's Asia ex-Japan stock index tacked on 0.1 per cent, while Japan's Nikkei index closed up 0.03 percent.

At 07:01 GMT, the yuan was quoted at 6.4121 per US dollar, 0.14 per cent weaker than the previous close of 6.403. The largest percentage gainers in the main Shanghai Composite index were Gome Telecom Equipment Co Ltd up 10.04 per cent, followed by CCS Supply Chain Management Co Ltd gaining 9.96 per cent and Triumph Science & Technology Co Ltd up by 8.4 per cent.

The largest percentage losses in the Shanghai index were Hna Innovation Co Ltd down 10.06 per cent, then Easysight Supply Chain Management Co Ltd losing 10.02 per cent and Zhejiang Haiyue Co Ltd down 10.02 per cent. So far this year, the Shanghai stock index is up 5.46 per cent, the CSI300 is 7.6 per cent higher, while China's H-share index listed in Hong Kong is up 12.6 per cent.

About 21.75 billion shares were traded on the Shanghai exchange, roughly 126.6 per cent of the market's 30-day moving average of 17.18 billion shares a day. Volume in the previous trading session was 24.75 billion. As of 07:02 GMT, China's A-shares were trading at a premium of 27.82 per cent over the Hong Kong-listed H-shares. The Shanghai stock index is above its 50-day and 200-day moving averages.

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