SHANGHAI _ Chinese stocks rose Thursday as heavyweight insurers surged on speculation a possible interest rate could boost their earnings.

The benchmark Shanghai Composite Index gained 1.2 percent to 4,230.82. The Shenzhen Composite Index inched up 0.1 percent to 1,245.19.

Expectations that Beijing might move as soon as Friday to boost interest rates prompted speculation that insurers might benefit.

China Life Insurance rose 8.3 percent to 43.42 yuan and Ping An Insurance (Group) Co. of China climbed 4.6 percent to 73.91 yuan.

"Interest rate hikes will lead to higher investment returns for insurance companies, which put a large portion of their assets in bonds and deposits," said Shao Ziqin, an analyst at Ping An Securities,

But caution over other possible measures to tighten credit and cool stock prices weighed on the market.

Industrial equipment manufacturer Ningxia Yin Xing Energy dropped 9.7 percent to 15.34 yuan, agricultural-to-chemicals conglomerate Gansu Yasheng Industrial (Group) fell 7 percent to 10.37 yuan and textile firm Jiangsu Sainty shed 6 percent to 14.31 yuan.

In currency dealings, the yuan fell back against the U.S. dollar after its official rate was set lower for the first time in more than a week.

The dollar was at 7.6196 at 0730 GMT, up from Wednesday's close of 7.6180.