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Shanghai index rises on lower inflation, recovery in trade
By Ye Zhen |
June 11, 2012, Monday
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Online Edition
Online Edition
SHANGHAI stocks gained today as stronger-than-expected data for May alleviated concern the world's second largest economy is headed for a hard landing.
The benchmark Shanghai Composite Index rose 1.07 percent, or 24.41 points to 2,305.86 points. Turnover was 60.2 billion yuan (US$9.6 billion) at the trading close.
Inflation in May eased to 3 percent, the lowest since July 2010, the National Bureau of Statistics said on Saturday. The CPI was down from 3.4 percent in April. Food prices in May gained 6.4 percent from a year earlier, compared with 7 percent in April, the bureau said.
"The deceleration of inflation in May was largely attributed to a decline in food prices," said Teng Tai, chief economist at Minsheng Securities, who estimated inflation would fall below 3 percent in the third quarter.
With inflationary pressure dropping, analysts said they expect the government to further ease monetary policy to combat an economic slowdown.
"Two more interest rate cuts totaling 50 basis points may happen within the year," said Peng Wensheng, chief economist at China International Capital Corporation Limited.
A separate report by the General Administration of Customs showed China's trade recovered last month. Exports increased 15.3 percent from a year earlier, exceeding April's 4.9 percent, while imports climbed 12.7 percent, up from 0.3 percent in the previous month.
The environmental protection industry continued its recent strong performance on policy stimulus, with the sector gaining 5.6 percent today. Beijing Capital Co, a company specializing in wastewater disposal, gained 2.8 percent to 5.22 yuan. Tianjin Capital Environmental Protection Group Co rose 4.5 percent to end at 5.80 yuan.
Oil producers gained after oil trading in New York surged the most in more than five months yesterday. China Petroleum and Chemical Co, also known as Sinopec, and China's largest oil refiner, added 1.1 percent to finish at 6.52 yuan. PetroChina Co, the second biggest player, increased 1.1 percent to 9.21 yuan.
Property developers surged after an official from the National Development and Reform Commission said the government might ease property policies to stimulate economic growth. China Vanke, the nation's biggest developer, jumped 3.1 percent to close at 9.20 yuan. Poly Real Estate, the second largest developer, climbed 3.2 percent to 14.07 yuan. Gemdale Corporation soared 4 percent to 7.05 yuan.
The benchmark Shanghai Composite Index rose 1.07 percent, or 24.41 points to 2,305.86 points. Turnover was 60.2 billion yuan (US$9.6 billion) at the trading close.
Inflation in May eased to 3 percent, the lowest since July 2010, the National Bureau of Statistics said on Saturday. The CPI was down from 3.4 percent in April. Food prices in May gained 6.4 percent from a year earlier, compared with 7 percent in April, the bureau said.
"The deceleration of inflation in May was largely attributed to a decline in food prices," said Teng Tai, chief economist at Minsheng Securities, who estimated inflation would fall below 3 percent in the third quarter.
With inflationary pressure dropping, analysts said they expect the government to further ease monetary policy to combat an economic slowdown.
"Two more interest rate cuts totaling 50 basis points may happen within the year," said Peng Wensheng, chief economist at China International Capital Corporation Limited.
A separate report by the General Administration of Customs showed China's trade recovered last month. Exports increased 15.3 percent from a year earlier, exceeding April's 4.9 percent, while imports climbed 12.7 percent, up from 0.3 percent in the previous month.
The environmental protection industry continued its recent strong performance on policy stimulus, with the sector gaining 5.6 percent today. Beijing Capital Co, a company specializing in wastewater disposal, gained 2.8 percent to 5.22 yuan. Tianjin Capital Environmental Protection Group Co rose 4.5 percent to end at 5.80 yuan.
Oil producers gained after oil trading in New York surged the most in more than five months yesterday. China Petroleum and Chemical Co, also known as Sinopec, and China's largest oil refiner, added 1.1 percent to finish at 6.52 yuan. PetroChina Co, the second biggest player, increased 1.1 percent to 9.21 yuan.
Property developers surged after an official from the National Development and Reform Commission said the government might ease property policies to stimulate economic growth. China Vanke, the nation's biggest developer, jumped 3.1 percent to close at 9.20 yuan. Poly Real Estate, the second largest developer, climbed 3.2 percent to 14.07 yuan. Gemdale Corporation soared 4 percent to 7.05 yuan.
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