Chinese small-cap stocks rally again - but the Shanghai Composite hit the lunch break DOWN

Photo by Feng Li/Getty Images

For a second consecutive session Chinese small-cap stocks are outperforming their larger compatriots.

At the midday break the Shenzhen Composite, CSI 500 and ChiNext indices, those littered with small-cap firms, have risen by 2.32%, 3.12% and 2.98% respectively.

While they are outperforming, large-cap stocks are not. The benchmark Shanghai Composite index finished the morning session down 0.5% with the SEC 50 index, containing the 50-largest firms listed in Shanghai, lower by 2.68%. The CSI 300 is also off 0.91%.

Having fallen by more than 30% from mid-June through to early July, Chinese stocks have rebounded strongly in recent days on the back of unprecedented government measures to support them with with small-cap stocks, having endured the worst of the selling pressure recently, leading the charge higher.

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