Chinese shares rallied for the second day on Thursday, pushing up the benchmark index to a one-month high, after the State Council said Wednesday it would step up efforts to adjust and reinvigorate some of the country's key industries.

The Shanghai Composite Index gained 1.27 percent, or 38.44 points, to close at 3,060.62 points.

The Shenzhen Component Index picked up 1.73 percent, or 212.18 points, to finish at 12,494.27 points.

Combined turnover Thursday increased to 239.9 billion yuan (35.12 billion U.S. dollars), from 185.2 billion yuan on Wednesday.

Winners outnumbered losers by 826 to 49 in Shanghai and 809 to 59 in Shenzhen.

Sinopec, Asia's largest refiner, rose 1.35 percent to 11.3 yuan as the petrochemical industry was one of the ten key industries China's State Council said it would continue to adjust and reinvigorate during Wednesday's executive meeting chaired by Premier Wen Jiabao.

The other nine industries are auto, steel, information technology, logistics, textile, nonferrous metal, equipment manufacturing, shipbuilding as well as light industry, according to a statement issued after the meeting.

The benchmark index was also driven up by investors' interest in the previously battered financial and property shares.

Banking shares advanced across the board by 2.24 percent despite the central bank's decision to raise the deposit reserve requirement ratio for Chinese financial institutions by 0.5 percentage points taking effect on Thursday.

Shanghai Pudong Development Bank led the rally, up 5.49 percent to 20.74 yuan. Industrial and Commercial Bank of China, the country's largest commercial bank, rose 1.04 percent to 4.88 yuan, while Bank of China advanced 1.21 percent to 4.16 yuan.

Property development shares surged 3.46 percent. China Vanke Co., the country's largest property developer by market value, was up 2.71 percent to 9.48 yuan. Poly Real Estate Group Co., the country's second largest developer, rose 3.1 percent to 19.96 yuan.

Sichuan Changhong Electric Co., the country's second-biggest television maker, lost 1.46 percent to 7.41 yuan after rumors circulated it had falsified its financial reports, but were denied by the company's spokesman Li Haizhong Thursday afternoon.

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