Paper makers make light of index's gain
By Lydia Chen |
March 9, 2011, Wednesday
|
Print Edition
Print Edition
SHANGHAI'S key stock index edged up to close near the 3,000-point level yesterday, boosted by paper makers which gained from an appreciating yuan.
The Shanghai Composite Index added 0.12 percent to end at 2,999.94 as it continued to ride on its nearly four-month high close on Monday. Turnover declined to 169 billion (US$26 billion) from Monday's 208 billion yuan.
Chen Kaiwei, an analyst with Changjiang Securities, and Tong Bin, an analyst at Guotai Junan Securities, said the recent rebound will extend till at least mid-March thanks to ample liquidity in the market. Tong expected the index to touch 3,200 points, a correction after last year's fall of 14.3 percent.
The People's Bank of China, the central bank, yesterday fixed the yuan's mid-point against the US dollar at 6.5687, slightly weaker from Monday's record of 6.5651, according to the China Foreign Exchange Trading System.
Economists forecast that the yuan is likely to climb 5-7 percent against the greenback this year.
Paper makers were one of the biggest beneficiaries of a stronger yuan which would lower the price of imported pulp, which accounts for 80 percent of paper-making costs. Chen also said paper makers rose as investors rotated between sectors looking for quick profits.
Henan Yinge Industrial Investment Holdings Co jumped by the daily cap of 10 percent to close at 12.27 yuan.
Cement producers fell following their previously stellar gains.
Huaxin Cement Co lost 2.94 percent to 43.59 yuan.
The Shanghai Composite Index added 0.12 percent to end at 2,999.94 as it continued to ride on its nearly four-month high close on Monday. Turnover declined to 169 billion (US$26 billion) from Monday's 208 billion yuan.
Chen Kaiwei, an analyst with Changjiang Securities, and Tong Bin, an analyst at Guotai Junan Securities, said the recent rebound will extend till at least mid-March thanks to ample liquidity in the market. Tong expected the index to touch 3,200 points, a correction after last year's fall of 14.3 percent.
The People's Bank of China, the central bank, yesterday fixed the yuan's mid-point against the US dollar at 6.5687, slightly weaker from Monday's record of 6.5651, according to the China Foreign Exchange Trading System.
Economists forecast that the yuan is likely to climb 5-7 percent against the greenback this year.
Paper makers were one of the biggest beneficiaries of a stronger yuan which would lower the price of imported pulp, which accounts for 80 percent of paper-making costs. Chen also said paper makers rose as investors rotated between sectors looking for quick profits.
Henan Yinge Industrial Investment Holdings Co jumped by the daily cap of 10 percent to close at 12.27 yuan.
Cement producers fell following their previously stellar gains.
Huaxin Cement Co lost 2.94 percent to 43.59 yuan.
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