Banks and consumption to fuel index
By Ding Yining |
January 4, 2010, Monday
|
Print Edition
Print Edition
THE Shanghai stock market is likely to be boosted by banking shares and the consumer sector as investors anticipate more weight will be given to domestic consumption as a new driver for the Chinese economy this year.
The benchmark Shanghai Composite Index notched an 80 percent annual gain in 2009 after the central government stimulus measures boosted investor confidence. The local market slumped 65 percent in 2008.
"The central government will attach more importance on domestic demand and consumer spending, thus benefiting the service and retail sectors," Ping An Securities wrote.
China's Purchasing Manager Index rose 1.4 points from November to 56.6 in December last year, the 10th month for the gauge to stay above 50 points, indicating an economic expansion.
Listed companies are likely to generate a 25 percent jump in their annual profit for last year, which will push the index even higher as this would indicate further proof of an economic recovery, CITIC Securities wrote in a research note.
The benchmark Shanghai Composite Index notched an 80 percent annual gain in 2009 after the central government stimulus measures boosted investor confidence. The local market slumped 65 percent in 2008.
"The central government will attach more importance on domestic demand and consumer spending, thus benefiting the service and retail sectors," Ping An Securities wrote.
China's Purchasing Manager Index rose 1.4 points from November to 56.6 in December last year, the 10th month for the gauge to stay above 50 points, indicating an economic expansion.
Listed companies are likely to generate a 25 percent jump in their annual profit for last year, which will push the index even higher as this would indicate further proof of an economic recovery, CITIC Securities wrote in a research note.
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