China stocks closed higher on Tuesday, as Shanghai achieved a key COVID-19-related milestone required to ease restrictions, while reports about a meeting by a top political consultative body to promote the digital economy aided sentiment.

 

The blue-chip CSI300 index ended 1.3% higher at 4,005.89, while the Shanghai Composite Index gained 0.7% to 3,093.70 points.

** Shanghai reported a long-awaited milestone of three straight days with no new COVID-19 cases outside quarantine zones — the "zero COVID" status. A nationwide caseload also declined, with 1,100 new cases reported on Monday, down from 1,227 infections on Sunday.

** Shanghai plans to resume outdoor activities in stages, with most restrictions on movement remaining in place until May 21, and the lockdown should be lifted by June.

** "The good news is the headline COVID-19 case number has been falling," Nomura said in a note, but "we are not at a turning point yet."

** "The outlook for economic fundamentals and most financial assets in coming months will be largely determined by Beijing's stance on its zero-COVID strategy rather than the number of daily cases."

** China's state planner will strengthen support for manufacturers, the service sector and small firms, it said on Tuesday, as China's retail and factory activity fell sharply in April due to wide lockdowns.

** Semiconductors and new energy firms gained 3.6% each, and automobiles surged 4.2%.

** Chinese Vice-Premier Liu He is scheduled to speak at a Tuesday meeting with tech executives that has been convened by the country's top political consultative body to promote the development of the digital economy, sources told Reuters.

** The meeting is being closely watched for remarks by Liu and others for clues as to how far Chinese authorities will go in easing a regulatory crackdown since late-2020 on the tech sector.

(Reporting by Shanghai Newsroom; editing by Uttaresh.V)