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Real estate shares pull key index to close up
By Lydia Chen |
February 12, 2011, Saturday
|
Print Edition
Print Edition
SHANGHAI stocks reversed their decline in the morning and closed higher yesterday, led by real estate developers because of their low valuations.
The Shanghai Composite Index edged up 0.3 percent to 2,827.33. Turnover increased to 127.73 billion yuan (US$19.41 billion) from Thursday's 117.15 billion yuan.
The benchmark rose 1 percent for the three-session trading week, which was shortened by the week-long Spring Festival holiday.
Property developers became the main driver to boost the market, as bargain hunting continued on their attractive valuations.
"Their current valuations are already low enough even in the worst scenario," said Chen Kaiwei, an analyst of Changjiang Securities.
Poly Real Estate Group gained 2.4 percent to 13.06 yuan, extending Thursday's 2 percent rise after losing 10 percent from January 27 to Wednesday following China's introduction of fresh property tightening measures on January 26.
But investors should still be wary over any government attempt to curb banks' loan supply volume, which are critical to property developers, Chen said.
Construction-related companies paced the gains. Chen rated them a "buy" due to their promising earning prospects. Shanghai Pudong Road-Bridge Construction Co jumped 10 percent to 20.17 yuan.
Agriculture-related firms, which have been the most active in the past two trading days due to government support, fell. Gansu Dunhuang Seed Co dipped 1 percent to close at 34.94 yuan.
The Shanghai Composite Index edged up 0.3 percent to 2,827.33. Turnover increased to 127.73 billion yuan (US$19.41 billion) from Thursday's 117.15 billion yuan.
The benchmark rose 1 percent for the three-session trading week, which was shortened by the week-long Spring Festival holiday.
Property developers became the main driver to boost the market, as bargain hunting continued on their attractive valuations.
"Their current valuations are already low enough even in the worst scenario," said Chen Kaiwei, an analyst of Changjiang Securities.
Poly Real Estate Group gained 2.4 percent to 13.06 yuan, extending Thursday's 2 percent rise after losing 10 percent from January 27 to Wednesday following China's introduction of fresh property tightening measures on January 26.
But investors should still be wary over any government attempt to curb banks' loan supply volume, which are critical to property developers, Chen said.
Construction-related companies paced the gains. Chen rated them a "buy" due to their promising earning prospects. Shanghai Pudong Road-Bridge Construction Co jumped 10 percent to 20.17 yuan.
Agriculture-related firms, which have been the most active in the past two trading days due to government support, fell. Gansu Dunhuang Seed Co dipped 1 percent to close at 34.94 yuan.
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