Shanghai and Shenzhen exchanges are conducting tests to ensure smooth trading amid the transaction boom

A screen in Shanghai showed the performance of the A-share market on September 30. Total turnover on the Shanghai and Shenzhen stock exchanges rose to a historic high of 2.6 trillion yuan ($270.45 billion) on the day. Photo: CFP

China's Shanghai and Shenzhen stock exchanges will reportedly conduct a series of tests on their platforms on Monday to ensure a smoother trading experience, as the two exchanges' total turnover rose to 2.6 trillion yuan on the trading day ahead of the seven-day National Day holiday, driven by various economic stimulus measures.

To ensure smooth transactions after the National Day holiday, the Shenzhen Stock Exchange will conduct system connectivity testing on Monday, allowing affiliated securities firms to test their technological systems for post-holiday trading, according to a notice on the exchange's website.

Meanwhile, the Shanghai Stock Exchange will conduct a similar test on Monday, CCTV News reported.

Due to transaction delays during trading on September 27th, the Shanghai Stock Exchange conducted a test on September 29th to ensure the stability of the platform during peak order submission periods.

China's recent favorable policies, including cuts in reserve requirements and interest rates to support economic recovery, have significantly boosted investor expectations. The recent stock rally has also increased demands on trading systems.

On the final trading day before the week-long National Day holiday, the benchmark Shanghai Composite Index rose 8.06 percent to close at 3,336.50 points, while the Shenzhen Component Index rose 10.67 percent to close at 10,529.76 points.

Chinese stock markets are closed from October 1st to Monday.

The Hong Kong stock market continued to rise, with the Hang Seng Index rising 10.2 percent between September 30 and Friday.

Since the beginning of the fourth quarter, the general market atmosphere has improved significantly, Hong Kong Finance Minister Paul Chan Mo-po wrote in his blog on the official website of the Hong Kong government on Sunday. The Hang Seng Index has risen to a high of around two and a half years and has gained a total of 5,600 points or around 33 percent in the last 15 trading days.

From early September to Friday, daily turnover in the Hong Kong stock market reached about HK$192 billion (US$24.72 billion), twice as much as in August, according to official data, he wrote.

Due to a recent surge in securities account openings driven by market trends, the China Securities Depository and Clearing Corporation (CSDC) opened its account platform and identity verification system on Sunday, a day ahead of schedule, to handle the high volume of account verifications. according to media reports.

“With Hong Kong's stock market performing strongly, the upward momentum could continue and A-shares are expected to open higher on the first trading day after the National Day holiday,” Yang Delong, chief economist at Shenzhen-based First Seafront Fund, told the Global Times.

Recently, the country's central bank, top securities regulator and financial regulator announced a series of monetary stimulus, measures to support the real estate market and strengthen the capital market to promote the country's high-quality economic development. “The strength and timing of this round of policy measures exceeds the expectations of both domestic and global investors,” Yang said.

Wang Zonghao, head of China equity strategy research at UBS, said in a note to the media that he expects A-shares' short-term momentum to likely continue until mid-October. “Historically, Chinese stocks tend to perform better in October, registering an increase of 1.5 percentage points compared to the monthly average,” he said.

UBS announced an upward revision to its year-end price target for the MSCI China Index to $70, reflecting improvements in policy coordination, U.S. interest rate cuts and progress in corporate governance reforms.

Bloomberg reported, citing market watchers, that a wave of capital that previously left Chinese stocks for stocks in Japan and Southeast Asia is poised to reverse as investors rush to join the rally.