BEIJING, Jan. 22 (Xinhua) -- Chinese stocks closed higher Monday, with the key Shanghai index rising for the fifth consecutive trading day and to its highest in more than two years.

The benchmark Shanghai Composite Index edged up 0.39 percent to 3,501.36, its highest level since December 31, 2015. The Shenzhen Component Index closed 1.92 percent higher at 11,513.08.

Combined turnover on the two bourses shrank slightly to 517.23 billion yuan (about 80.8 billion U.S. dollars) from 537.9 billion yuan the previous trading day.

Most stocks gained, with gainers outnumbering losers by 850 to 431 in Shanghai and by 1,289 to 588 in Shenzhen.

Shares of home appliance producers led the gains. Gree Electric Appliances, one of China's leading home appliance makers, surged by the daily 10-percent limit, to 56.6 yuan per share. Midea Group rose 5.6 percent to 61.43 yuan.

Bucking the upward trend, banking shares fell. Shanghai Pudong Development Bank lost 3.55 percent to 12.77 yuan. The Bank of Communications dropped 1.19 percent to 6.67 yuan per share.

The ChiNext Index, which tracks China's NASDAQ-style enterprises, surged 2.32 percent to end at 1,768.21 Monday, after a Securities Daily article said the country would accelerate reforms on the board this year to support high-tech firms and emerging industries.

"China will accelerate reforms on the IPO system as well as those concerning mergers and acquisitions to provide more support for high-tech and innovative companies," Zhang Shenfeng, assistant chairperson of China Securities was quoted as saying.