The Shanghai Composite Index, which covers yuan-denominated A shares and foreign-currency B shares, gained 1.5 percent, to 1288.42 , the biggest gain since February 21. The Shenzhen Composite Index, which tracks the smaller market, added 3.22, or 1 percent, to 312.20.

Turnover on the Shanghai Composite Index rose to 10 billion yuan (HK$9.66 billion) from 9.37 billion yuan Friday.

Investors expect a planned Disney theme park in Pudong area of the city to boost the value of land holdings and create business opportunities, analysts said.

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Earlier this month, Shanghai Mayor Han Zheng told reporters at the National People's Congress, the nation's annual parliamentary session, that the city is preparing to build a Disney theme park and is awaiting central government approval.

"The news has become widespread in the media lately and many people expect the park to open ahead of the 2010 World Expo in Shanghai," said Xu Yinghui, an analyst at Guotai Junan Securities.

"Once the Disney project is approved by the central government, the assets held by Pudong-based companies will be revalued," he said.

Shanghai Jinqiao Export Process Zone Development's yuan-denominated A shares rose 9 percent to 6.57 yuan, while its B shares ended 4.7 percent higher at US$0.628. China Enterprise added 6.8 percent to 4.85 yuan.

Both companies have land holdings in the possible vicinity of the theme park, said analyst Zhu Haibin at Everbright Securities. Shares of metal producers climbed after a US industrial production report suggested demand for raw materials is strengthening in the world's biggest economy.

"Global demand for metals still seems strong at this stage, which will sustain the earnings growth at commodity companies," said Guo Yong, chief strategist with GF Securities in Guangzhou. Jiangxi Copper, China's largest producer of the metal, gained 5.4 percent, to 7.19 yuan.

Angang New Steel, the listed arm of China's second- largest steelmaker, led steelmakers higher after a report said its parent will raise prices of its products. Angang Steel rose 1.6 percent to 5.24 yuan. Baoshan Iron & Steel, the listed unit of China's biggest steelmaker, gained 2.4 percent, to 4.26 yuan.

Meanwhile Shenzhen-listed Chongqing Changan Automobile, a minicar and minibus maker, Monday issued a plan for floating its nontradable shares.

Under the program, Changan Auto's controlling shareholder will give investors 2.8 shares for every 10 listed A shares held, the company said in a notice in the state-run China Securities Journal.

So far, around 60 percent of China's more than 1,300 listed firms have completed or started programs to convert their nontradable shares into tradable stock, since regulators began allowing them to in April last year.

Changan's share-reform plan is subject to shareholders' approval at a meeting scheduled for April 24.

Changan Auto's yuan-denominated A shares were suspended from trading Monday.

They will resume trading no later than March 30, the notice said. They closed up 1.9 percent Friday at 5.40 yuan.

Changan Auto's Shenzhen-listed Hong Kong dollar-denominated B shares slid 2 percent Monday at HK$4.03.

Holders of Changan Auto's B shares won't get any compensation for the reform program, the notice said.

"The nontradable shares will be floated on the A share market. That's why we are only compensating our existing A-share holders," said a person at Changan Auto's securities department who gave his surname as Wang. DOW JONES NEWSWIRES, BLOOMBERG