(Bloomberg) -- Chinese stocks began Tuesday’s session with a bang — an onshore benchmark surged 11% as soon as trading resumed after a weeklong break. But the enthusiasm faded as the day progressed, with the lack of more major stimulus from a key policy meeting disappointing investors.

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In the end, the CSI 300 Index finished just 5.9% higher. In Hong Kong, a gauge of Chinese shares was down more than 10%, on course to erase almost all of the gains made while onshore markets were shut for the Golden Week.

Anticipation for an opening pop had been building given the rally in Hong Kong-listed shares, reports of record account openings at major Chinese brokerages in preparation for Tuesday’s session and hopes that the press briefing by the nation’s top economic planning agency will offer more positive catalysts.

“The meeting underwhelmed our modest expectations and seemingly those of investors,” Michael Hirson and Houze Song of 22V Research LLC wrote in a note. “While Beijing is keen to revive equities, it does not feel compelled to abandon financial restraint to aggressively stimulate the real economy.”

The CSI 300 Index had risen for nine straight sessions through Sept. 30 before the Golden Week break, boosted by a stimulus blitz that included interest-rate cuts, freeing-up of cash for banks and support for stocks. That saw Wall Street heavyweights including Goldman Sachs Group Inc., HSBC Holdings Plc and BlackRock Inc. upgrading the once-beaten down stock market amid bets of further stimulus.

Tuesday’s rally helped the onshore gauge close at the highest level since July 2022, and some market watchers are already cautioning against stocks reaching overvalued levels. The index is trading at 13.3 times one-year forward earnings versus a five-year median of 11.9 times.

An overheating of the A-share market and the Chinese government’s delivery on its recently-announced policy stimulus are among the risks investors should watch amid the Chinese stock market rally, Morgan Stanley strategists including Laura Wang in Hong Kong wrote in a research note. That adds to the skepticism shown earlier by some other strategists and fund managers who said they are waiting for Beijing to back up its stimulus pledges with real money.

“The durability of this China rally will depend on action following words on the fiscal side of the equation,” said Aleksey Mironenko​​​​, global head of investment solutions at Leo Wealth in Hong Kong. “The key thing we are watching going forward — what policies will be announced in coming weeks following the Politburo and State Council statements?”

“That will determine if our overweight is a tactical one — to be taken off as relative valuations change – or a strategic one,” he added.

Tuesday’s session saw turnover in Shanghai and Shenzhen surge to an unprecedented 3.43 trillion yuan ($486 billion). That surpassed the previous record seen on Sept. 30, when the CSI 300 Index climbed 8.5% in its biggest one-day surge since 2008.

Several brokerages saw their trading apps experience temporary freezes amid surge in volumes, Cailian reported, citing an IT professional at a brokerage firm.

Officials at the National Development and Reform Commission said they would speed up spending, while largely reiterating plans to boost investment and increase direct support for low-income groups and new graduates. They added that China would continue to issue ultra-long sovereign bonds next year to support major projects and bring forward a 100 billion yuan investment on key strategic areas originally budgeted for 2025 to this year.

China’s leaders aim to achieve around 5% growth this year, but economic data in recent months show that would be hard to reach as consumer spending remained sluggish and a property downturn persisted.

Turnover in Hong Kong also hit a record high though Chinese shares listed in the city suffered as focus shifted to mainland markets. The Hang Seng China Enterprises Index’s plunge came after it had jumped more than 30% over the past month through Monday, making it the best performer among more than 90 global equity gauges tracked by Bloomberg.

“There is some convergence in the markets — a rotation from Hong Kong to China,” said Marvin Chen, a strategist at Bloomberg Intelligence in Hong Kong. “A-shares are primarily going to be the beneficiary of the domestic liquidity stimulus.”

The world’s second-largest equity market has had multiple boom-and-bust cycles. Confronted by slowing growth and disinflation, China swung into stimulus mode in late 2014, setting off an eye-watering stock market rally that spectacularly crashed back to earth in mid 2015. The Shanghai Stock Exchange Composite Index more than doubled its level from October 2014 to June 2015, but then plunged more than 40% in two months.

“We need fiscal, and then hopefully some real major economic reform,” Eva Lee, head of Greater China equities at UBS Global Wealth Management in Hong Kong, said on Bloomberg Television. “By the end of this year, if we still do not have any major measure, we probably will end at this level.”

China’s offshore yuan rebounded from earlier losses in the session as the onshore rate, which had stayed shut for five sessions, traded 0.5% lower to 7.0558 per dollar in a post-holiday catch-up move. Yields on the nation’s benchmark bond initially rose seven basis points before paring that move to 2.20%.

--With assistance from Tian Chen, John Cheng, Sangmi Cha, April Ma and Joanna Ossinger.

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