Nov. 14 (Bloomberg) -- China's stocks rose, sending the benchmark index to its best week since April, after the government pledged higher spending on agriculture and on speculation the central bank may cut borrowing costs.

Heilongjiang Agriculture Co. and Gansu Yasheng Industrial (Group) Co. jumped more than 7 percent after the Ministry of Agriculture said it will spend a further 5.15 billion yuan ($754 million) to improve rural infrastructure and farmers' living conditions. China Vanke Co., the nation's biggest listed property developer, added 4.1 percent and Beijing Urban Construction Investment & Development Co. surged by the 10 percent daily cap.

The CSI 300 Index, which tracks yuan-denominated A shares listed on China's two exchanges, climbed 69.57, or 3.7 percent, to 1,943.65 at the close. Only three stocks fell on the 300- member gauge. It's up 16 percent this week, its biggest gain since April 25.

``It looks like the rebound will carry on,'' said Yan Ji, an investment manager at HSBC Jintrust Fund Management Co. in Shanghai, which manages about $850 million. ``There's very strong speculation the central bank will cut rates again and that will benefit rate-sensitive stocks such as developers the most.''

The need for additional measures was underscored today by statistics showing that China's spending on factories and real estate cooled. That added to figures on industrial output, trade and inflation in signaling a deepening slowdown in the world's fourth-biggest economy.

Leaders from the Group of 20 nations, accounting for almost 90 percent of global gross domestic product, will hold a summit in Washington this week to coordinate responses to the worst financial crisis since the Great Depression.

Prevent `Drastic Slowdown'

China needs to prevent a ``drastic slowdown,'' Mu Hong, vice chairman of the nation's top economic planning agency, the National Development and Reform Commission, said at a press briefing in Beijing today. ``We face a formidable challenge.''

Since reaching a two-year low on Nov. 4, the CSI 300 has advanced 19 percent as the government announced a 4 trillion yuan ($586 billion) stimulus plan to boost growth. The measure remains 64 percent lower on the year on concern demand for Chinese products will sink amid the global financial crisis.

Heilongjiang Agriculture, the second-largest agricultural company by revenue, climbed by the maximum 10 percent to 12.38 yuan. Yasheng Industrial, a holding company that has agricultural investments, jumped 7 percent to 3.35 yuan. Beijing Shunxin Agriculture Co., an operator of farming and food businesses, gained 6.9 percent to 11.40 yuan. Shenzhen Agricultural Products Co. advanced 5.7 percent to 12.90 yuan.

Farm Investment

The increased farm investment will mainly be used for methane projects, grain production, prevention of animal epidemics and quality control, the agriculture ministry said in a statement yesterday.

Plunging global markets and forecasts for slowing growth worldwide have prompted the central bank to cut interest rates three times since September to bolster the domestic economy.

China is ``clearly engaged in an ongoing process of policy easing to promote growth,'' Tim Condon, head of Asia research at ING Groep NV, said in an interview with Bloomberg Television today. ``We expect them to ease monetary policy again imminently.''

Vanke rose 4.1 percent to 6.92 yuan. Beijing Urban Construction, a developer based in the capital city, surged 10 percent to 7.25 yuan. Poly Real Estate Group Co., China's second-largest developer by market value, added 4.1 percent to 16.02 yuan. Gemdale Corp., a developer allied with ING Groep NV, gained 7.6 percent to 6.38 yuan.

Consumer Prices

Growth in consumer prices and industrial output has tapered off, the bureau said this week, leaving more room for the central bank to ease monetary policies. China's economy expanded 9 percent in the third quarter, the slowest pace since June 2003.

Chinese banks relaxed lending requirements for mortgages as the government seeks to stabilize the country's property market, the Hong Kong Standard reported today, citing people it didn't identify.

The Shanghai Composite Index, which tracks the bigger of China's stock exchanges, rose 3.1 percent to 1,986.44. The Shenzhen Composite Index added 4.4 percent to 545.34.

The following companies were among the most active in China's markets. Stock symbols are in brackets after companies' names.

Gold producers: China should increase its bullion holding to diversify its reserves because the dollar may decline, Hou Huimin, vice chairman of the China Gold Association, said today. The group represents producers, traders and retailers.

Zijin Mining Group Co. (601899 CH), China's largest gold producer, jumped 10 percent to 3.87 yuan. Zhongjin Gold Corp. (600489 CH), the second largest, surged 10 percent to 29.34. Shandong Gold Mining Co. (600547 CH), the No. 3, climbed 10 percent to 38.13 yuan.

China Minsheng Banking Corp. (600016 CH), the nation's first privately owned bank, added 0.11 yuan, or 2.4 percent, to 4.67. Minsheng said it plans to sell bonds to help cover a shortfall of 10 billion yuan as the nation's regulator raises the minimum capital adequacy ratio.

Insigma Technology Co. (600797 CH), a manufacturer of computer networking equipment, jumped 0.33 yuan, or the 10 percent daily limit, to 3.59. The company said it has won a joint bid for a contract worth 85.6 million euros ($109.4 million) from TPP Maritza East 2, a state-owned power company in Bulgaria.

Sichuan Swellfun Co. (600779 CH), the Chinese liquor maker that's a partner of Diageo Plc, advanced 0.98 yuan, or 10 percent, to 10.76. The stock was rated ``buy'' in initial coverage by analyst Yan Yalei at Bohai Securities Co., who said Swellfun will increase dividend payments and its valuation is lower than rivals.

To contact the reporter on this story: Zhang Shidong in Shanghai at szhang5@bloomberg.net

Last Updated: November 14, 2008 03:36 EST