Chinese ADRs gained in premarket trading as investors anticipated government economic stimulus, despite uncertainty about its specifics and timing. Li Auto rose 6%; Bilibili rose 4%; XPeng rose 3%; NIO rose 2%; Trip.com, JD.com, and PDD Holdings rose 1%.

China's Ministry of Industry and Information Technology (MIIT) announced today that it will foster and expand emerging industries and new sectors, including the low-altitude economy, commercial space industry, and biomanufacturing. The ministry will also ramp up efforts to promote consumption of smart home appliances, coordinate with local governments to accelerate the implementation of trade-in policies for cars and electric bicycles, and continue to carry out activities like the "New Energy Vehicles to Rural Areas" program to fully unleash market potential.

The ministry will take multiple measures to expand automobile consumption. It will implement policies to boost consumption, such as trade-in programs for old cars, tax incentives for vehicle purchases and vehicle and vessel taxes. The campaign to promote new energy vehicles in rural areas will continue, and a new batch of pilot programs for the full electrification of public sector vehicles will be launched. The department will also study and develop guidelines for battery-swapping models for new energy vehicles, actively promoting the expansion of automobile consumption.

Investors are cautiously optimistic with rumors of a two trillion yuan ($280 billion) market stabilization fund aimed at boosting China's economy. This speculation lifted the China and Hong Kong stocks, rebounding from recent lows.

A Chinese policy think tank has called for Beijing to issue 2 trillion yuan ($280 billion) of special treasury bonds to set up a stock market stabilisation fund, the 21st Century Business Herald reported on Wednesday.

Such a fund could steady the market through buying and selling blue-chips and exchange-traded funds (ETFs), according to the proposal by the Institute of Finance & Banking, affiliated to the Chinese Academy of Social Sciences (CASS).

The proposal is part of a quarterly report by the institute on China's economy. CASS is China's premier academic organisation, although it was unclear if or how the proposal would influence policy.

When asked about the potential setup of a stock market stabilisation fund last month, China's central bank chief Pan Gongsheng told reporters a study of the proposal was under way.

The Institute of Finance & Banking also proposed more investment by long-term capital to steady the market, according to the newspaper. For example, China could raise the ceiling of stock investment by insurance companies and the national pension fund, the think tank proposed.

China has already introduced policies to encourage institutional stock investment.

Last Friday, China's central bank kicked off two funding schemes that will initially pump as much as 800 billion yuan into the stock market.

Under the facilities, brokerages, insurers and asset managers can have easier access to liquidity for share purchases, while listed companies and their major shareholders can tap cheap PBOC lending for share buybacks and holding increases.