Mainland stocks advanced on Thursday, with the Shanghai benchmark closing at a decade high level, driven by hefty gains in fintech and stablecoin-concept shares after a report signalled a major shift in Beijing's stance on digital assets.

In Hong Kong, the benchmark Hang Seng Index ended down 61 points, or 0.24 percent, at 25,104.

The Hang Seng China Enterprises Index fell 38.50 points, or 0.43 percent, to end at 8,974 while the Hang Seng Tech Index dropped 42 points, or 0.77 percent, to 5,498.

On the mainland, the benchmark Shanghai Composite Index ended up 0.13 percent to 3,771, the loftiest close since August 2015, while the Shenzhen Component Index closed 0.06 percent lower at 11,919.

The combined turnover at these two indexes stood at about 2.4 trillion yuan, largely unchanged from Wednesday.

Stocks related to stablecoin, oil and gas, and aesthetic nursing led gains while stocks related to diesel generators and liquid-cooled servers suffered major losses.

The ChiNext Index, tracking China's Nasdaq-style board of growth enterprises, lost 0.47 percent to close at 2,595.

Fintech and stablecoin-concept shares were among the biggest winners in morning deals, after sources said China is considering allowing the use of yuan-backed stablecoins for the first time to boost wider adoption of its currency globally.

China's plan for the usage of stablecoins, if approved, would mark a major shift in its approach towards digital assets.

The country banned cryptocurrency trading and mining in 2021 due to concerns about the stability of the financial system.

The CSI Fintech Theme index advanced 0.78 percent while Brilliance Technology jumped 12.59 percent and Tansun Technology Co leapt 4.75 percent.

Chinese shares have been rising, supported by easing trade tensions between the world's two largest economies and improved liquidity conditions, and as investors shift out of bonds and into stocks, traders and analysts said.

James Wang, head of China strategy at UBS Investment Bank research, said rising retail participation could be one of the drivers underpinning the recent stock rally.

"Retail flows may have been one of the drivers with trading volume up 80 percent year on year on the A-share and margin financing balance outstanding also rising sharply," Wang said.

"As retail participation typically increases following stronger performances for the A-shares, it would seem that A-share offers better upside potential." (Reuters/Xinhua)