Banks drive up index for third week
By Feng Jianmin and Pan Xiaoyi |
August 7, 2010, Saturday
|
Print Edition
Print Edition
BANKS and property developers led a rally in Shanghai stocks yesterday, extending gains for the key index to a third week, as concerns over stress tests and liquidity have eased.
The benchmark Shanghai Composite Index added 1.44 percent, or 37.63 points, to close at 2,658.39. Turnover rose to 125 billion yuan (US$18.5 billion) from yesterday's 115 billion yuan.
The gauge gained 0.8 percent for the week.
China Banking Regulatory Commission yesterday said new stress tests do not indicate changes in the property policy.
The comment came after media reports about a new round of stress tests to see whether banks can absorb a fall of up to 60 percent in home prices.
Meanwhile, liquidity concerns eased after China Insurance Regulatory Commission widened insurers' investment scope to include real estate and equities of unlisted companies. The regulator also modified rules to allow them to invest a bigger portion of assets in shares.
"Although it will take time before the insurers' money pours into the market, investor confidence has been boosted," Shandong Shenguang Securities Co said in a research note. "However, liquidity will be tightened next week as a bunch of stocks will launch initial public offerings."
Insurers were among the winners. China Life Insurance Co, the country's largest life insurer, rose 1.09 percent to 24.01 yuan. China Pacific Insurance (Group) Co was 1.33 percent higher to 23.60 yuan. Ping An Insurance (Group) Co rose 0.65 percent to 46.81 yuan.
The Bank of Communications advanced 2.51 percent to 6.54 yuan. The Bank of China gained 0.86 percent to 3.52 yuan. The Industrial and Commercial Bank of China rose 0.71 percent to 4.26 yuan.
The benchmark Shanghai Composite Index added 1.44 percent, or 37.63 points, to close at 2,658.39. Turnover rose to 125 billion yuan (US$18.5 billion) from yesterday's 115 billion yuan.
The gauge gained 0.8 percent for the week.
China Banking Regulatory Commission yesterday said new stress tests do not indicate changes in the property policy.
The comment came after media reports about a new round of stress tests to see whether banks can absorb a fall of up to 60 percent in home prices.
Meanwhile, liquidity concerns eased after China Insurance Regulatory Commission widened insurers' investment scope to include real estate and equities of unlisted companies. The regulator also modified rules to allow them to invest a bigger portion of assets in shares.
"Although it will take time before the insurers' money pours into the market, investor confidence has been boosted," Shandong Shenguang Securities Co said in a research note. "However, liquidity will be tightened next week as a bunch of stocks will launch initial public offerings."
Insurers were among the winners. China Life Insurance Co, the country's largest life insurer, rose 1.09 percent to 24.01 yuan. China Pacific Insurance (Group) Co was 1.33 percent higher to 23.60 yuan. Ping An Insurance (Group) Co rose 0.65 percent to 46.81 yuan.
The Bank of Communications advanced 2.51 percent to 6.54 yuan. The Bank of China gained 0.86 percent to 3.52 yuan. The Industrial and Commercial Bank of China rose 0.71 percent to 4.26 yuan.
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