SHANGHAI (AFP) - Shanghai stocks rallied Monday morning as investors chased financial shares after state media reported that China's central bank had further eased monetary policy, dealers said.

The benchmark Shanghai Composite Index jumped 1.74 per cent, or 54.96 points, to 3,212.56.

But the Shenzhen Composite Index, which tracks stocks on China's second exchange, edged down 0.22 per cent, or 3.23 points, to 1,436.25.