(Bloomberg) -- Chinese stocks turned volatile in Thursday’s morning session as traders awaited the outcome of the government’s planned briefing on fiscal policy due Saturday.

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The CSI 300 Index was up 2.8% as of 11:12 a.m. local time, after gyrating between gains and losses earlier. The benchmark plunged 7.1% in the prior session in its worst day since 2020. An index of Chinese stocks listed in Hong Kong gained more than 4% before a holiday in the city on Friday.

Traders are pinning their hopes on the finance ministry’s briefing for the rally to sustain momentum. Fiscal measures have been missing from Beijing’s stimulus package so far, and money managers and strategists have warned that the rebound may be another false dawn if pledges aren’t backed up with real money.

Finance Minister Lan Fo’an is expected to introduce moves to strengthen fiscal policy to shore up growth, and answer questions from reporters on Saturday, according to the State Council Information Office.

“Investors are still holding out hope for an announcement from the Ministry of Finance that approves additional government bond issuance on top of this year’s budget to support fiscal spending,” said Jeffrey Kleintop, chief global investment strategist at Charles Schwab & Co. “The hurdle is high for the MoF to deliver on the market’s expectations.”

Turnover so far in the session was already more than a third of the record 3.43 trillion yuan ($485 billion) seen on Tuesday.

Chinese stocks started rallying from late September after Beijing unveiled a barrage of monetary stimulus and vowed to boost fiscal spending. The onshore benchmark surged more than 30% from a September low through Tuesday, before sliding Wednesday on profit taking and emerging skepticism.

How long the momentum can last will hinge on the scale and speed of follow-up policy action, with lackluster holiday spending data a reminder that the economy is far from gaining a solid foothold. Any disappointment from the Saturday briefing may renew a selloff.

The ministry “will likely discuss a supplementary fiscal package for the remainder of the year, although it may be modest in size,” Morgan Stanley economists led by Robin Xing wrote in a note. Economists at Societe Generale SA also said the government is unlikely to announce a “super-sized fiscal stimulus” of 5 trillion yuan to 10 trillion yuan in one go.

“The size and scope of the next package could disappoint, especially if it remains modest,” said Billy Leung, an investment strategist at Global X Management in Sydney. “Investors are likely to remain on edge, with volatility continuing as they wait for clearer forward guidance on the 2025 fiscal outlook. We’ll see more of this back-and-forth until there’s clarity on Beijing’s commitment.”

--With assistance from Charlotte Yang and Wenjin Lv.

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