The benchmark Shanghai Composite Index rose by 0.78 percent to 1,965.28 on Friday morning boosted by comments from the central bank chief.

Zhou Xiaochuan said the bank will continue its prudent monetary policy and "adjust liquidity".

"The People's Bank of China will continue prudent monetary policy, and adopt fine-turning under proper conditions,” Zhou said.

Banking and property led the rally on Friday morning.

Zhuang Xinyi, vice-chairman of the China Securities Regulatory Commission, said the authority will strengthen supervision over the stock market, push for information disclosure and protect small investors.