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Good economic data lift Shanghai market
By Lydia Chen |
July 13, 2011, Wednesday
|
Online Edition
Online Edition
MARKET optimism today lifted Shanghai shares from yesterday's biggest losses in seven weeks, riding on China's better-than-expected growth that eased investors' concerns on the country's economy.
The Shanghai Composite Index climbed 1.48 percent to 2,795.48. Turnover fell slightly to 107.7 billion (US$16.67 billion) from yesterday's 111.54 billion.
The cross-board rally showed investors' confidence has returned after China's economic growth data reassured markets that the world's second-largest economy was maintaining its growth momentum, said Zhou Xuesong, an analyst with Sealand Securities.
China's annual gross domestic product grew 9.5 percent in the second quarter of 2011 and posted 9.6 percent in the first half despite a slew of monetary tightening that aims to curb inflation.
Retail sales in the country also posted strong growth with a jump of 16.8 percent from January to June from a year ago, showing that domestic demand still held up relatively well, according to the National Statistics Bureau.
"The economy is likely to maintain at a fast growing pace in the second half," Zhou said. "And at the meantime, inflation is expected to ease a bit, which are both good news to companies."
He expected a rebound on the US dollar in the near future, which could ease China's pressure from imported inflation through commodities.
An index that tracks purchasing price for manufacturers has already posted considerable falls in the past two months, meaning raw materials are becoming cheaper, Zhou added.
Commodities were among the best performers today as worries that a slower economy may reduce demands ebbs away.
Zhongjin Gold hiked 3.99 percent to 28.94 yuan. Jiangxi Copper, the nation's biggest producer of the metal, buoyed 3.41 percent to 36.07 yuan. Jiangxi Copper said in a statement that its first-half net income may climb by more than 50 percent from a year earlier on higher output and sale prices.
Financial firms and developers, which were the major dragging force in previous trading, rose on strength of the GDP report.
Industrial & Commercial Bank of China added 1.17 percent to 4.34 yuan. Ping An Insurance Group climbed 1.80 percent to 47.42 yuan. Citic Securities advanced 1.25 percent to 12.98 yuan. China Vanke jumped 1.29 percent to 8.61 yuan.
But China International Capital Corp cautioned that the government is likely to raise the interest rate at least one more time and several bank reserve rate hikes in the second half of this year since inflation will remain the top priority.
The Shanghai Composite Index climbed 1.48 percent to 2,795.48. Turnover fell slightly to 107.7 billion (US$16.67 billion) from yesterday's 111.54 billion.
The cross-board rally showed investors' confidence has returned after China's economic growth data reassured markets that the world's second-largest economy was maintaining its growth momentum, said Zhou Xuesong, an analyst with Sealand Securities.
China's annual gross domestic product grew 9.5 percent in the second quarter of 2011 and posted 9.6 percent in the first half despite a slew of monetary tightening that aims to curb inflation.
Retail sales in the country also posted strong growth with a jump of 16.8 percent from January to June from a year ago, showing that domestic demand still held up relatively well, according to the National Statistics Bureau.
"The economy is likely to maintain at a fast growing pace in the second half," Zhou said. "And at the meantime, inflation is expected to ease a bit, which are both good news to companies."
He expected a rebound on the US dollar in the near future, which could ease China's pressure from imported inflation through commodities.
An index that tracks purchasing price for manufacturers has already posted considerable falls in the past two months, meaning raw materials are becoming cheaper, Zhou added.
Commodities were among the best performers today as worries that a slower economy may reduce demands ebbs away.
Zhongjin Gold hiked 3.99 percent to 28.94 yuan. Jiangxi Copper, the nation's biggest producer of the metal, buoyed 3.41 percent to 36.07 yuan. Jiangxi Copper said in a statement that its first-half net income may climb by more than 50 percent from a year earlier on higher output and sale prices.
Financial firms and developers, which were the major dragging force in previous trading, rose on strength of the GDP report.
Industrial & Commercial Bank of China added 1.17 percent to 4.34 yuan. Ping An Insurance Group climbed 1.80 percent to 47.42 yuan. Citic Securities advanced 1.25 percent to 12.98 yuan. China Vanke jumped 1.29 percent to 8.61 yuan.
But China International Capital Corp cautioned that the government is likely to raise the interest rate at least one more time and several bank reserve rate hikes in the second half of this year since inflation will remain the top priority.
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