Index gains amid money flow optimism
By Lu Nengneng |
April 7, 2012, Saturday
|
Print Edition
Print Edition
SHANGHAI'S key stock index edged up yesterday, capping its first weekly gain in a month, on continued optimism over new money flowing into the share market after the country's securities regulator increased quotas for yuan-denominated investment by foreigners.
The Shanghai Composite Index closed up 0.2 percent to 2,306.55 points. The index rose 1.9 percent for the week.
The China Securities Regulatory Commission announced that quotas for qualified foreign investors in stocks, bonds and bank deposits have been raised from US$30 billion to US$80 billion.
A separate program for yuan-denominated foreign investment had its quota increased by 50 billion yuan (US$7.93 billion) to 70 billion yuan. The securities watchdog also said it has scrapped a rule limiting investment in equities to 20 percent in favor of a new rule allowing the full quota to be invested in yuan-denominated exchange-traded funds.
Brokerages were among the gainers on expectations that the additional foreign funds will help bolster the market. CITIC Securities gained 1.3 percent to 12.42 yuan. Industrial Securities added 0.3 percent to 10.14 yuan.
Changjiang Securities said in a note that the time is not ripe for bottom-pickers to enter the market because China's economy will very likely experience a further downturn this month, which may trigger another correction in share prices.
The Shanghai Composite Index closed up 0.2 percent to 2,306.55 points. The index rose 1.9 percent for the week.
The China Securities Regulatory Commission announced that quotas for qualified foreign investors in stocks, bonds and bank deposits have been raised from US$30 billion to US$80 billion.
A separate program for yuan-denominated foreign investment had its quota increased by 50 billion yuan (US$7.93 billion) to 70 billion yuan. The securities watchdog also said it has scrapped a rule limiting investment in equities to 20 percent in favor of a new rule allowing the full quota to be invested in yuan-denominated exchange-traded funds.
Brokerages were among the gainers on expectations that the additional foreign funds will help bolster the market. CITIC Securities gained 1.3 percent to 12.42 yuan. Industrial Securities added 0.3 percent to 10.14 yuan.
Changjiang Securities said in a note that the time is not ripe for bottom-pickers to enter the market because China's economy will very likely experience a further downturn this month, which may trigger another correction in share prices.
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