$CSI 300 Index (000300.SH)$$CSI 300 Financials (000849.SH)$ ...

Chinese financial stocks extended their recent rally, as traders continued to bet on policy support for state-run firms to help regain momentum in a market faced with renewed growth concerns.

The CSI 300 Financials Index jumped as much as 1.4% on May 9, on track for a six-day winning streak, the longest in 4 months. Bank of China led the pack with a 6.2% jump, even after it said business operations are normal and it has nothing major to disclose.

A Bloomberg gauge of onshore-listed brokerage shares also surged as much as 4.1%, reaching its highest level in 11 months.

The latest gains in major state firms from banks to securities firms and telecom operators indicate that Beijing's pledge to widen funding access for them has offered investors a fresh reason to restart a stalled reopening rally. Several Chinese lenders' recent decisions to cut deposit rates also have boosted appetite for the banking sector.

The market sentiment is still fragile and investors are relatively conservative in their moves, bank names are often favoured in China. Investors like their dividend yields and the call from the authorities to discover the value in central SOEs.

The gains came with surging trading volume, pointing to a rally driven mostly by trading momentum rather than fundamentals. Chinese lenders posted a tepid set of first-quarter earnings as they faced deeper margin woes despite being sheltered from the recent global banking jitters.