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Shanghai index gains most in over 3 years
By Ye Zhen |
December 14, 2012, Friday
|
Online Edition
Online Edition
SHANGHAI stocks soared the most in more than three years to a 4-month high as data showed China's economy is recovering while investors speculated that a crucial economic meeting this weekend may yield stimulus measures.
The benchmark Shanghai Composite Index surged 4.32 percent, the biggest advance since October 2009, to close at 2,150.63 points, the highest close since August 10, 2012. Daily turnover stood at 117.7 billion yuan (US$19 billion).
HSBC's Flash China Purchasing Managers' Index, the earliest indicator of the nation's manufacturing activity at private and export-oriented firms, climbed for five months running to a 14-month high of 50.9 in December, up from November's 50.5. A reading above 50 indicates expansion.
"The data shows China's economic growth momentum is continuing, mainly bolstered by recovering domestic demand while the external environment remains weak," said Qu Hongbin, HSBC chief economist for China.
Meanwhile, data from the National Energy Administration showed electricity consumption in China rose 7.6 percent year-on-year to 413.9 billion kilowatt-hours in November, up from October's increase of 6.1 percent, reflecting the nation's economy is gathering pace.
Market advanced ahead of this weekend's Central Economic Working Conference, at which China's top policymakers will assess the current state of the economy and set the tone for the next year's economic policies.
"Investors are betting that there will be stimulus policies to further support China's economy following the meeting," said Liu Jingde, analyst with Cinda Securities.
Chu Jianfang, chief economist with CITIC Securities, expects the government to maintain a prudent monetary policy while taking a more proactive fiscal policy next year. "China is likely to ease fiscal policy and spend more on financial subsidies in the coming year as it accelerates construction of projects to bolster growth and continues tax reduction," Chu said.
Financial stocks gained the most. ICBC Ltd, the nation's largest lender, rose 3.8 percent to 4.10 yuan. China Minsheng Banking Corp advanced 8.4 percent to 7.47 yuan. China Merchants Bank added 7.6 percent to 11.70 yuan.
Cement producers rose on hopes that accelerated infrastructure construction will fuel demand. Anhui Conch Cement Co, China's biggest cement producer, rose 4.7 percent to 18.76 yuan. Gansu Qilianshan Cement jumped 5.6 percent to 10.18 yuan. Shaanxi Qinling Cement Co surged by the daily limit of 10-percent to 5.87 yuan.
The benchmark Shanghai Composite Index surged 4.32 percent, the biggest advance since October 2009, to close at 2,150.63 points, the highest close since August 10, 2012. Daily turnover stood at 117.7 billion yuan (US$19 billion).
HSBC's Flash China Purchasing Managers' Index, the earliest indicator of the nation's manufacturing activity at private and export-oriented firms, climbed for five months running to a 14-month high of 50.9 in December, up from November's 50.5. A reading above 50 indicates expansion.
"The data shows China's economic growth momentum is continuing, mainly bolstered by recovering domestic demand while the external environment remains weak," said Qu Hongbin, HSBC chief economist for China.
Meanwhile, data from the National Energy Administration showed electricity consumption in China rose 7.6 percent year-on-year to 413.9 billion kilowatt-hours in November, up from October's increase of 6.1 percent, reflecting the nation's economy is gathering pace.
Market advanced ahead of this weekend's Central Economic Working Conference, at which China's top policymakers will assess the current state of the economy and set the tone for the next year's economic policies.
"Investors are betting that there will be stimulus policies to further support China's economy following the meeting," said Liu Jingde, analyst with Cinda Securities.
Chu Jianfang, chief economist with CITIC Securities, expects the government to maintain a prudent monetary policy while taking a more proactive fiscal policy next year. "China is likely to ease fiscal policy and spend more on financial subsidies in the coming year as it accelerates construction of projects to bolster growth and continues tax reduction," Chu said.
Financial stocks gained the most. ICBC Ltd, the nation's largest lender, rose 3.8 percent to 4.10 yuan. China Minsheng Banking Corp advanced 8.4 percent to 7.47 yuan. China Merchants Bank added 7.6 percent to 11.70 yuan.
Cement producers rose on hopes that accelerated infrastructure construction will fuel demand. Anhui Conch Cement Co, China's biggest cement producer, rose 4.7 percent to 18.76 yuan. Gansu Qilianshan Cement jumped 5.6 percent to 10.18 yuan. Shaanxi Qinling Cement Co surged by the daily limit of 10-percent to 5.87 yuan.
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