China's stocks gained in the morning trade session Wednesday, erasing heavy falls at the opening after the central bank unexpectedly announced Tuesday the first increase of interest rates in nearly three years.

The benchmark Shanghai Composite Index climbed 0.65 percent to finish 19.57 points higher at 3,021.42. The Shenzhen Component Index closed at 13,162.47, up 192.27 points, or 1.48 percent at midday.

Overnight, China's central bank announced a raise of its benchmark one-year lending and deposit rate by 0.25 percentage points effective from Wednesday.