Shanghai Composite Rises 1.08% on Nov 2, 2026 on Buyback Support Talk

Key takeaways

• The Shanghai Composite rose 1.08% to 3,638.03 at the close (07:00 UTC) on Monday, Nov 2, 2026, according to Yahoo Finance data and The Standard. Chinese regulators had arranged talks with major banks on a lending programme that funds share buybacks.
• Growth boards led the rebound. The Shenzhen Component gained 1.63% to 11,010.68, ChiNext rose 1.87% to 2,458.70 and the blue-chip CSI 300 added 0.79% to 4,016.92.
• In Hong Kong, the Hang Seng Index rose 0.42% to 23,393.32 at the close (08:08 UTC), and the Hang Seng Tech Index jumped 2.25% to 3,839.41. Xiaomi and CATL each gained about 6%, The Standard reported.
• Hong Kong-listed Chinese banks fell. Bank of China lost 4.6% and BOC Hong Kong lost 5.7%, according to The Standard.
• Official data released on Oct 31 showed China's manufacturing PMI fell to 49.3 in October from 50.1, below the 50 line that separates expansion from contraction, CGTN reported, citing the National Bureau of Statistics.
• The PBOC set the USD/CNY midpoint at 6.7146 at 01:15 UTC, slightly weaker for the yuan than Friday's 6.7138 and well above the 6.6625 Reuters estimate, according to FXStreet.

Session recap

Mainland China and Hong Kong stocks began November with gains after a heavy October selloff. The rebound came as regulators prepared to discuss more support for share buybacks. For the rest of the region, see Asian and global market closes. Friday's session is covered in the China & Hong Kong brief for Oct 30, when the Shanghai Composite fell 1.44% and closed below 3,600.

Changes are calculated from Friday's (Oct 30) closes: Shanghai 3,599.02, Shenzhen 10,833.78, ChiNext 2,413.63, CSI 300 3,985.50, Hang Seng 23,294.42 and Hang Seng Tech 3,754.90 (Yahoo Finance). A higher midpoint means a weaker yuan fixing. A verifiable full-day Stock Connect southbound figure for Nov 2 was not available when this brief was written.

The Shanghai Composite traded between 3,594.77 and 3,648.13 during the session, while the CSI 300 ranged from 3,988.17 to 4,038.81, according to Yahoo Finance. The Hang Seng Index moved between 23,271.26 and 23,543.30, and the Hang Seng Tech Index between 3,763.76 and 3,870.37. Full-day turnover in Hong Kong was HK$204.8 billion, The Standard reported.

What drove it

Regulators turn to buyback financing

The main driver was policy. According to investingLive's Asia-Pacific wrap, the People's Bank of China was set to meet financial regulators and major banks on Monday to study improvements to a relending programme for share buybacks. That programme gives banks central-bank funding so they can lend to listed companies and major shareholders who buy back shares or raise their stakes. Finimize named the PBOC, the National Financial Regulatory Administration and the China Securities Regulatory Commission as the participants. The meeting followed what investingLive called the CSI 300's "worst month in more than a decade" in October. Officials had not published the outcome of the meeting at the time of writing.

Weak official PMI, firmer private survey

Data released over the weekend gave mixed signals. The official manufacturing PMI fell to 49.3 in October from 50.1 in September, and the non-manufacturing PMI fell to 49.7 from 50.2, according to FXStreet and CGTN. FXStreet put the market consensus for manufacturing at 50.0. Huo Lihui, chief statistician at the NBS Service Industry Survey Center, attributed the drop mainly to seasonal factors, including a pullback in overseas orders after a strong September, CGTN reported. The new orders sub-index fell to 49.4. The private RatingDog manufacturing PMI, released on Monday, held at 52.0, and output grew at its fastest pace since April, investingLive reported. Finimize described the session as a rise on buyback support talk despite the PMI slip.

Tech and hardware rebound

After October's AI-led selloff, covered in our explainer on the STAR 50 index slump, technology and growth shares led on Monday. In Hong Kong, Xiaomi rose 6.1%, CATL 6%, Alibaba 2.5%, Tencent 2.2%, Hua Hong Semiconductor nearly 3% and SMIC 1.5%, according to The Standard. Casino operators also gained: Galaxy Entertainment rose 3.7% and Sands China 3.1%.

Banks lag in Hong Kong

Large Chinese lenders held back the Hang Seng Index. BOC Hong Kong fell 5.7%, Bank of China 4.6%, China Merchants Bank 2.8% and ICBC 1.5%, The Standard reported. The sources reviewed did not give a reason for the decline. China Construction Bank rose as much as 2.5% to HK$10.52 during the session, after reporting on Oct 30 a 6.55% rise in nine-month net profit attributable to shareholders, to RMB 274.226 billion, according to Investing.com.

Liquidity and the yuan

The PBOC began daily overnight reverse repo operations at a fixed rate of 1.25%, below the 1.4% seven-day rate, investingLive reported. The yuan midpoint was set at 6.7146 per dollar, compared with 6.7138 on Friday. FXStreet and Tradingpedia both noted that the fixing was far above the 6.6625 Reuters estimate. Tradingpedia said the fixing points to a softer yuan than the estimate implied. For ASEAN investors, the yuan fixing and China's factory data are worth tracking because mainland demand matters for regional exporters of coal, nickel, palm oil and electronics.

Political & policy watch

• Buyback relending review: The PBOC, NFRA and CSRC held talks with major banks on optimising the stock-buyback and stake-increase relending tool, according to Investing.com and Finimize. Any changes to its size, rates or eligibility have not been officially announced.
• New overnight operations: The daily overnight reverse repo at a fixed 1.25% adds a new short-term liquidity tool, investingLive reported. How it fits with the seven-day rate as the main policy signal is something to follow in PBOC statements.
• Currency management: Monday's fixing of 6.7146 was 0.0008 weaker for the yuan than Friday's 6.7138, a very small daily change, according to FXStreet. The fixing was still well above the 6.6625 Reuters estimate.
• Factory deflation pressure: CGTN reported, citing the NBS, that the ex-factory price sub-index fell to 51.7 in October. That keeps producer prices in focus ahead of the official PPI release.

What to watch next

Risk checklist for readers

• Policy headlines can move Chinese stocks sharply in both directions. Plans to "study" or "optimise" a tool are not the same as approved measures, so check official PBOC, CSRC or NFRA statements.
• A PMI reading below 50 signals contraction. Compare the official NBS survey, which is weighted towards large and state-owned firms, with private surveys such as RatingDog before drawing conclusions.
• The PBOC midpoint is a reference rate, not the traded spot price. Compare each fixing with the previous day's fixing and with the published market estimate.
• Hong Kong and mainland indices have different sector weights. On Nov 2, tech rose while large banks fell, so one headline index can hide very different sector moves.
• Currency risk matters for foreign investors: returns on mainland shares depend on the yuan, while Hong Kong shares trade in Hong Kong dollars.
• Scheduled releases such as CPI, PPI and activity data on Nov 9 and Nov 16 can increase volatility, and the NBS lists its calendar as subject to change.

Related on Bullquill

• Shanghai Composite Rises 0.91% on Oct 28, 2026 as Tech Stocks Rebound
• Shanghai Composite Falls 0.82% on Oct 29, 2026 as Tech Selloff Deepens
• Shanghai Composite Falls 1.33% on Oct 27, 2026 as Chip Stocks Slide
• Hang Seng Rises 0.51% on Oct 26, 2026 as Tech Losses Narrow
• China stocks Oct 23: CSI 300 closes up 1.71%, Hang Seng +0.69%

This article is for information only and is not investment advice.