SHANGHAI stocks advanced today after China released strong trade data that suggest the recovery of the world's second largest economy is gaining momentum while inflation eased in January.

The key Shanghai Composite Index added 0.57 percent to 2,432.40 points with a daily turnover of 99 billion yuan (US$15.7 billion). The index edged up 0.6 percent this week.

China's imports surged 28.8 percent year on year to US$158.2 billion in January, up from 6 percent in December, the General Administration of Customs said today. Exports jumped 25 percent to US$187.4 billion, far outpacing December's 14.1 percent, resulting in a US$29.2 billion trade surplus in January, the Customs said.

"The surge of trade data is partly due to the effects of the Spring Festival. Excluding these effects, the figures are still strong, signaling growing domestic demand as the nation's economy rebounds," said Zhang Zhiwei, analyst with Nomura Securities.

Tang Jianwei, an economist at the Bank of Communications, said: "A mild recovery in the US and European economies will boost China's exports while imports will keep growing on rising domestic demand as enterprises start re-stocking."

China's Consumer Price Index in January rose 2 percent from a year earlier, the National Bureau of Statistics said today. That compares with a 2.5 percent inflation in December.

Auto makers led the market gains as data from the China Association of Automobile Manufacturers showed that the sales of cars and commercial vehicles soared 46.38 percent year on year to 2.03 million units in January.

SAIC Motor Corporation jumped 7.4 percent to 18.46 yuan. Beiqi Foton Motor Co rose 2.4 percent to 7.62 yuan. Great Wall Motor Co Ltd climbed 5.8 percent to 29.86 yuan.