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Loan spurt assists in Shanghai stock rally

SHANGHAI'S key stock index rebounded yesterday as growth of loans was faster than expectations.

The benchmark Shanghai Composite Index was up 1.37 percent, or 42.26 points, to close at 3,123.03 points.

Turnover reached 184.34 billion yuan (US$26.98 billion), from 155.3 billion yuan the previous day.

"New yuan loans last month indicated there is still plenty of capital in the market and we will not see much change in monetary policy in the short term judging by the current situation," said Wu Ling, an analyst from S&E Securities Brokerage Co.

New yuan-backed loans more than doubled in June to 1.53 trillion yuan, according to the central bank.

Auto makers led gains after the China Association of Automobile Manufacturers said sales in June jumped 36.48 percent year on year. Shenyang Jinbei Automotive Co advanced 4.66 percent to 4.49 yuan. Foton Motor Co soared 5.67 percent to 15.09 yuan.

Steel producers gained on increased output. Baoshan Iron & Steel Co gained 1.87 percent to 8.18 yuan. Wuhan Iron & Steel Co advanced 1.8 percent to 9.03 yuan.

Airliners rose after oil prices fell. Air China climbed 5.4 percent to 8.2 yuan. China Southern Airlines Co lifted 3.16 percent to 5.88 yuan.

Crude oil for August delivery fell 4.4 percent to US$60.14 a barrel in New York, the lowest settlement since May 19. PetroChina Co, the nation's biggest oil producer, was up 0.48 percent to 14.66 yuan and Sinopec jumped 3.53 percent to 12.01 yuan.


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