CHINA aims to introduce after-hours trading in Shanghai's futures market within two months and reintroduce government bond futures within the year, officials said yesterday, as the country further opens up its capital markets.

Shanghai Futures Exchange Chairman Yang Maijun didn't disclose the extended hours of trading. Currently the market trades from 9am to 11:30am and from 1:30pm to 3pm. He was speaking at the exchange's annual Shanghai Derivatives Market Forum.

Extended trading will start with evening hours and possibly be expanded to holidays in the future. The plan is part of the SHFE's efforts to transform itself into a global marketplace.

It also comes at a time of rising competition in the region after the Hong Kong Exchanges & Clearing Ltd acquired the London Metal Exchange last year, which last week opened an Asian help desk to provide technology support for users during Asian trading hours.

The SHFE earlier said gold and silver contracts would be available for night trading first.

Price volatility in precious metals on global markets in recent months has exposed Chinese investors on the local exchange to risks. They sleep while markets in New York and London churn.

After-hours trading here would enable Chinese investors to close positions late in the day if prices swing sharply when Western markets open.

Longer trading hours may benefit futures brokerages.

The SHFE, China's biggest commodity exchange, trades copper, aluminum, zinc, lead, natural rubber, fuel oil, steel, gold and silver contracts.

"We have some 20 contracts in the pipeline," Yang said.

Jiang Yang, vice chairman of the China Securities Regulatory Commission, said at the forum that China aims by year-end to reintroduce trading in government bond futures, a major derivatives instrument banned in 1995 after a trading scandal.

Bond futures provide investors with an effective hedging instrument.