Commodity price rally drives city market up
By Lydia Chen |
July 15, 2011, Friday
|
Print Edition
Print Edition
A commodity rally yesterday heaved Shanghai stocks up to the highest in a week, after US Federal Reserve Chairman Ben Bernanke said the central bank is prepared to provide additional stimulus to boost the economy.
The Shanghai Composite Index added 0.5 percent to 2,810.44, the highest close since July 6.
Prices of commodities rallied to a four-week high after Bernanke indicated more economic stimulus plans could be possible in the future, which is expected to drive down the US dollar and boost demand for raw materials as a hedge against inflation.
The gold price climbed to a record level as silver surged the most since March 2009 in New York and London, partly due to a worsening European debt crisis while the US dollar dropped the most in two weeks against a six-currency basket.
Zhongjin Gold climbed 3 percent to 29.82 yuan. Jiangxi Copper rose 2.7 percent to 37.05 yuan. Zijing Mining Group jumped 6.3 percent to 5.78 yuan.
Analysts at Xiangcai Securities cautioned that the market may trade down for some time before gaining new momentum. The Hunan-based brokerage said in a report the market would most likely not stay above 2,810 points for long, a level that they expected to face pressure from bearish investors.
The Shanghai Composite Index added 0.5 percent to 2,810.44, the highest close since July 6.
Prices of commodities rallied to a four-week high after Bernanke indicated more economic stimulus plans could be possible in the future, which is expected to drive down the US dollar and boost demand for raw materials as a hedge against inflation.
The gold price climbed to a record level as silver surged the most since March 2009 in New York and London, partly due to a worsening European debt crisis while the US dollar dropped the most in two weeks against a six-currency basket.
Zhongjin Gold climbed 3 percent to 29.82 yuan. Jiangxi Copper rose 2.7 percent to 37.05 yuan. Zijing Mining Group jumped 6.3 percent to 5.78 yuan.
Analysts at Xiangcai Securities cautioned that the market may trade down for some time before gaining new momentum. The Hunan-based brokerage said in a report the market would most likely not stay above 2,810 points for long, a level that they expected to face pressure from bearish investors.
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