Shanghai stocks soared to a record yesterday, with the benchmark index eclipsing the 6,000 mark as investors snapped up stalwart companies amid euphoria over their business growth.

The rally arrived amid strong sentiment despite a weekend announcement by the central bank that it will increase banks' required reserves for the eighth time this year to mop up liquidity and curb credit expansion.

However, market observers believe the index may start to fluctuate as some big investors are set to lock in gains after the overall valuation of mainland stocks has more than doubled this year.

The Shanghai Composite Index, which covers yuan-denominated A shares and hard-currency B chips, was up 2.15 percent to close at 6,030.09.

The increase boosted the total market capitalization in Shanghai by 483 billion yuan (64.4 billion U.S. dollars) to a record of 22.93 trillion yuan.

Combined turnover on the Shanghai bourse totaled 195.4 billion yuan, compared with 221.8 billion yuan on Friday. Falls outnumbered gains by 449 to 404.

"As blue chips continue to be strong, the index is still on an upside track," said Lu Chengde, a Guosen Securities Co trader.

"But you may see more volatility in coming days as profit taking may set in."

The People's Bank of China said on Saturday that it will raise the reserve requirement ratio - the amount of cash lenders must park with the central bank - by 0.5 percentage point to 13 percent starting on October 25.

Aluminum Corporation of China increased 2.54 percent to 57.42 yuan after its parent agreed to buy China Nonferrous New Material Co from Liuzhou China Tin Group Co.

Haitong Securities Co advanced by the 10 percent daily cap to 60.41 yuan after reporting on Friday its nine-month net profit would exceed four billion yuan, a 15-fold surge from the same period last year.

Citic Securities Co swelled 1.58 percent to 106 yuan after saying that it had gained regulatory approval to invest clients' money in overseas securities markets under the Qualified Domestic Institutional Investor scheme.

China Petroleum & Chemical Corp, Asia's top oil refiner, gained 10 percent to 25.56 yuan after rising by a combined 28 percent in the previous seven sessions on optimism over growth prospects.

"It's very likely that investors who don't buy into heavyweights find they actually don't make a profit even though the index rises," said Wu Ke, a Zhongtian Investment Consulting Co analyst. "Risks are definitely mounting and it's not wise to hurry to buy stocks without considering valuations and fundamentals."

Real-estate counters led the losing pack after media reports that the government may start to impose a property tax on a trial basis as early as next year to further combat speculative investment.

Poly Real Estate Group Co, the country's top listed state-owned developer, declined 5.50 percent to 71.82 yuan. Shanghai Shimao Co, a local property developer, lost 6.77 percent to 24.22 yuan.