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Shanghai index grows to 6-day high
By Lydia Chen |
July 14, 2011, Thursday
|
Online Edition
Online Edition
SHANGHAI stocks rose in an expanded trading volume to the highest in six trading days today, powered by commodity producers.
The Shanghai Composite Index added 0.54 percent to 2,810.44. Turnover rose to nearly 125.65 billion yuan (US$19.45 billion) from yesterday's 107.7 billion yuan.
Prices of commodities rallied to a four-week high after United States Federal Reserve Chairman Ben Bernanke indicated more economic stimulus plans could be possible in the future, which is expected to drive down the US dollar and boost demand for raw materials as a hedge against inflation.
Zhongjin Gold climbed 3.04 percent to 29.82 yuan. Jiangxi Copper rose 2.72 percent to 37.05 yuan. Zijing Mining Group hiked 6.25 percent to 5.78 yuan.
Gold climbed to a record and silver surged the most since March 2009 in New York and London today, partly riding on a worsening Europe's debt crisis while the US dollar dropped the most in two weeks against a six-currency basket.
But whether the rally among commodity producers in the Shanghai stock market could be sustained is uncertain as analysts at Xiangcai Securities cautioned that the market may fall down for some time before heading up to form a new momentum.
The Hunan-based brokerage said the market is not likely to stay above 2,810 points for long, level that they considered will face pressure from bearish investors, the company said in a report today.
Meanwhile, banks, the biggest heavyweight sector, could also cast shadows over the country's record credit boom.
China Merchants Bank was down 0.61 percent to 13 yuan. Agriculture Bank of China lost 0.37 percent to 2.7 yuan.
China issued a record US$2.7 trillion two-year credit boom in awake of a global financial crisis in 2008, including loans to local governments and counties to finance infrastructure projects. The lending spree left the world's second largest economy with 51.4 trillion yuan in outstanding loans by the end of 2010.
Chinese lenders' credit outlook may sour in the absence of a government plan to deal with the issue, Moody's Investors Service said this month.
The Shanghai Composite Index added 0.54 percent to 2,810.44. Turnover rose to nearly 125.65 billion yuan (US$19.45 billion) from yesterday's 107.7 billion yuan.
Prices of commodities rallied to a four-week high after United States Federal Reserve Chairman Ben Bernanke indicated more economic stimulus plans could be possible in the future, which is expected to drive down the US dollar and boost demand for raw materials as a hedge against inflation.
Zhongjin Gold climbed 3.04 percent to 29.82 yuan. Jiangxi Copper rose 2.72 percent to 37.05 yuan. Zijing Mining Group hiked 6.25 percent to 5.78 yuan.
Gold climbed to a record and silver surged the most since March 2009 in New York and London today, partly riding on a worsening Europe's debt crisis while the US dollar dropped the most in two weeks against a six-currency basket.
But whether the rally among commodity producers in the Shanghai stock market could be sustained is uncertain as analysts at Xiangcai Securities cautioned that the market may fall down for some time before heading up to form a new momentum.
The Hunan-based brokerage said the market is not likely to stay above 2,810 points for long, level that they considered will face pressure from bearish investors, the company said in a report today.
Meanwhile, banks, the biggest heavyweight sector, could also cast shadows over the country's record credit boom.
China Merchants Bank was down 0.61 percent to 13 yuan. Agriculture Bank of China lost 0.37 percent to 2.7 yuan.
China issued a record US$2.7 trillion two-year credit boom in awake of a global financial crisis in 2008, including loans to local governments and counties to finance infrastructure projects. The lending spree left the world's second largest economy with 51.4 trillion yuan in outstanding loans by the end of 2010.
Chinese lenders' credit outlook may sour in the absence of a government plan to deal with the issue, Moody's Investors Service said this month.
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